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Millions set to lose jobless benefits — “I’m very scared,” one tells Yahoo News

Zachary Roth
The Lookout

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A job fair in Vancouver, Wash. AP Photo/Rick Bowmer

For Dawn Deane, the difference between just keeping her head above water and falling under is the unemployment insurance check she receives each week.

In June, Deane, who is 49, was laid off from her human-resources job at a Philadelphia nonprofit, where she made over $50,000 a year. Since then, jobless benefits have allowed her, barely, to keep up with her mortgage and car payments and her other bills--as well as to maintain some normalcy in her 9-year-old daughter's life. Without the benefits, Deane told Yahoo News in an interview, her home would likely fall into foreclosure, and she'd be forced to apply for welfare--which would mean a significant drop in her income, and would dramatically upend her and her daughter's lives.

"Push comes to shove, if we've got to move or something like that, I don't know what I'd have to tell her, how I would explain it to her," Deane said. "I can't imagine it."

She may soon have to. Last December, amid persistent joblessness, Congress agreed to extend federal unemployment benefits for 34-53 additional weeks, beyond the standard 26. But the extension will expire at the end of the year, if it's not re-approved--a lapse that would cause nearly 1.8 million Americans to lose their benefits in January (pdf), according to the National Employment Law Project, which supports an extension. During 2012 as a whole, around 6 million Americans--including Dawn Deane--would likely be thrown off the rolls, the Labor Department estimates.

Commentators have largely treated the saga as the latest example of partisan rancor in Washington. It's also been portrayed as an economic and fiscal issue: By stimulating the economy, extending the benefits would increase growth by about $42 billion, or 0.3 percent of GDP, according to the non-partisan Congressional Budget Office. And it would add around $45 billion to the deficit, unless it were offset with other spending cuts or tax hikes.

But amid the various policy debates, it's easy to lose sight of the human side of the issue. The sheer scale of the population affected, for one thing, is magnified by record levels of long-term joblessness. The median duration of unemployment is currently 21.6 weeks--astronomically high by historical standards--and there are still around four unemployed workers for every job opening. Previously, the highest jobless rate at which Congress has failed to approve extended benefits was 7.2 percent, in 1985. Today, the national unemployment rate is 8.6 percent.

"It seems like a horrible job market in which to cast laid off workers adrift once they've used up 26 weeks of regular [unemployment] benefits," Gary Burtless, a labor economist at the Brookings Institution, told Yahoo News via email.

The White House and congressional Democrats have been pushing for an extension. House Republicans Tuesday passed a plan to extend the benefits--along with an extension of the payroll tax cut--but it would also cut up to 40 weeks from the program, allow states to drug test applicants and cut Medicare benefits. That adds up to a non-starter for Democrats.

As a result, when--or whether--the benefits will get extended is anyone's guess. And that means that recipients such as Deane are twisting in the wind as Congress bickers. She says that she's been looking for new work constantly since June. And she's applied for other government benefits, such as food stamps and home energy assistance, but has found she isn't eligible. "I'm always told: 'You don't qualify because you're making too much, and it's just you and your daughter,' " she said.

"I'm very scared," she said. "I'm doing everything except for going out there and actually physically protesting. And I think I'm gonna get to that point."

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