Speaker William Howell (R-Stafford) sums up the unemployment unfunded mandate debate pretty nicely:
If the prohibitive provisions of the federal stimulus package that would raise the tax on every job in Virginia were removed, more unemployed workers could receive added assistance during this economic crisis without inhibiting long-term job creation. It is my sincere hope that our congressional delegation will work constructively and cooperatively to eliminate these onerous restrictions, heeding the calls from those businesses that will create the jobs necessary to hasten our economic recovery.”
Many people surmise that World War I began because the Great Powers, once they had committed to mobilizing their military might, couldn’t (or wouldn’t) pull back against the momentum.
In many ways, I feel that way about federal stimulus money as it applies to unemployment benefits: Only it’s the Democrats who have invested heavily in this and are using it as a political weapon. They aren’t about to seek any compromise.
Yesterday, in support of Terry McAuliffe, James Carville got in the act:
When it came time to help Virginians who lost their jobs, Bob McDonnell said “No, nope, not gonna happen.” His Republican buddies turned down $125 million in federal funds that would go right to families that need it the most — and Bob cheered them on.
Today, Minority Leader Ward Armstrong, will grandstand outside of the former Tultex plant in Martinsville and “will sign the Stand Up for Virginia petition, calling on Bob McDonnell and Republicans in Richmond to reverse their stance and accept $125 million in federal stimulus funds for unemployment.”
Unfortunately, the Democrats are perpetuating a lie.
In this case, Democrats know that they can leverage this issue as class warfare and, by golly, facts be damned, they will.
This is truly the height of hypocrisy.
First off, several key things were done in a bipartisan manner this last session to help the unemployed:
• $62.5 million in federal money was accepted – no strings attached and
• The time one can be eligible to receive benefits was expanded to 59 weeks from the previous 26.
• It’s now easier to retain health insurance while unemployed after being a full-time worker and seeking new work.
To say now that Republicans are ignoring the unemployed is silly.
Second, should the remaining $125 million be accepted “as is”, that would be tantamount to a long-term tax increase. The reality is that this proposal by congressional Democrats and President Barack Obama is the equivalent of shoving an unfunded mandate onto the states.
What they’re saying is that in order to receive these benefits, states have to meet a set of federal conditions.
Virginia doesn’t meet all the conditions…and if they did, it amounts to expanding unemployment benefits- a form of welfare. And how will these benefits be paid for? By the Virginia taxpayer.
Here’s what the federal law currently says regarding accepting this money. From the Department of Labor:
State Law Status. Applications should only be made under provisions of state law that are currently in effect as permanent law and not subject to discontinuation. This means that the provision is not subject to any condition – such as an expiration date, the balance in the state’s unemployment fund, or a legislative appropriation – that might prevent the provision from becoming effective, or that might suspend, discontinue or nullify it.
http://wdr.doleta.gov/directives/attach/UIPL/UIPL14-09.pdf – Page 4
We don’t have the money to start new programs in Richmond! And the best way to keep people unemployed is to be job creators, not raise taxes and become job killers.
Third, and here’s the lie, Republicans WANT to accept the money. But all they want is a sunset clause.
Bob McDonnell sent a great letter to the congressional delegation and said the following:
Today I ask you to work across party lines, as a united Virginia delegation, to eliminate the unfair stimulus bill requirement that this short-term funding be predicated on a permanent change in state law. We know Virginians need help, and the funding is available. However to ask the taxpayers and businesses of Virginia to add a significant long-term burden to get short-term help is not acceptable, especially when the long-term effect will be to hurt the very workers you are now trying to help. The solution is simple: remove the federal requirement for a permanent change in state unemployment benefits law. This will allow the Commonwealth to accept the money for the next year or two, and when the federal money ceases our programs can return to normal, ensuring our taxpayers and business owners aren’t left with another unfunded federal mandate.
The ball is now in Congress’s court. The question is, what will Glenn Nye, Tom Perriello, Gerry Connolly, Jim Moran, Rick Boucher, Bobby Scott, Mark Warner and Jim Webb do with it?
For those interested, here’s McDonnell’s complete letter:
Dear Virginia Congressional Delegation:
I am writing you today to express my hope that Virginia’s congressional delegation will lead the effort to affect a resolution for a contested portion of the American Recovery & Reinvestment Act of 2009 that contains provisions affecting the Commonwealth’s unemployment insurance (UI) program.
Like you, I understand these are tough economic times for Americans and that a tight job market is creating hardships for many Virginians. We appreciate the actions Congress has taken to try to assist the states during this recession. Virginia has already accepted billions in federal stimulus money, including $62.5 million in benefit money for employees who lost their jobs and are seeking full-time work. In addition the Commonwealth, through legislation sponsored this year by Delegate Sam Nixon (R-Chesterfield), has extended the period of time that unemployed Virginians can receive unemployment benefits from the traditional 26 weeks by up to an additional 33 weeks – or 59 weeks – of coverage. Through legislation sponsored by another House member, Delegate Danny Marshall (R-Danville), it has been made easier for full-time workers laid off from small businesses to retain health insurance as they seek future employment. These important steps were the result of a bipartisan effort to assist citizens during this tough economic period. It is this same spirit of cooperation that we need now as we consider how to utilize additional unemployment benefits temporarily available from the federal government.
These additional federal funds, amounting to another $125 million, provide short-term money to expand benefits to unemployed workers who are seeking part-time work and those in approved job training programs. The money was recently rejected by the General Assembly, and it appears that other states are considering similar action. The federal money comes with an unfortunate and burdensome mandate. In order to receive the short-term funding, Virginia must permanently change its unemployment benefit laws. In fact, the Department of Labor has issued a directive on the law stating:
State Law Status. Applications should only be made under provisions of state law that are currently in effect as permanent law and not subject to discontinuation. This means that the provision is not subject to any condition – such as an expiration date, the balance in the state’s unemployment fund, or a legislative appropriation – that might prevent the provision from becoming effective, or that might suspend, discontinue or nullify it.
http://wdr.doleta.gov/directives/attach/UIPL/UIPL14-09.pdf – Page 4
After the federal money runs out it would be up to the taxpayers and business owners of the Commonwealth to cover the substantial ongoing costs of providing these new benefits to new categories of workers not previously covered. This is yet another unfunded federal mandate that most employers and business owners believe will end up hurting the long-term ability of Virginia businesses to create new jobs and hire new workers.
I do not believe it is responsible public policy to create disincentives for businesses, small or large, to retain and create the new jobs that will help turn our economy around. There are many categories of part time employees like college students, temporary workers, welfare recipients and others who may not be hired in the future by business owners faced with a potential surge in unemployment claims.
Unemployment compensation policy is traditionally a state prerogative with each state making its own judgment on eligibility, funding, and programmatic implementation. The cherished principles of federalism crafted by Virginia’s founders require that we should not have a permanent change in state unemployment compensation law with the federal government exerting control and mandating long-term state business policy. It is important to recognize we have a temporary situation now with rising unemployment, and federal funds can be used now to ease the short-term pain. It is proper for the federal government to provide this money and to set the short-term requirements for its use. However, it is important to recognize that once the federal money stops, the states must resume their rightful historic roles in the determination of eligibility and funding of unemployment benefits. The current federal law fails to provide the states this right.
Today I ask you to work across party lines, as a united Virginia delegation, to eliminate the unfair stimulus bill requirement that this short-term funding be predicated on a permanent change in state law. We know Virginians need help, and the funding is available. However to ask the taxpayers and businesses of Virginia to add a significant long-term burden to get short-term help is not acceptable, especially when the long-term effect will be to hurt the very workers you are now trying to help. The solution is simple: remove the federal requirement for a permanent change in state unemployment benefits law. This will allow the Commonwealth to accept the money for the next year or two, and when the federal money ceases our programs can return to normal, ensuring our taxpayers and business owners aren’t left with another unfunded federal mandate.
I advised Governor Kaine that I want to work together to ensure Virginians get the help they need now. Let’s work to implement the solution that benefits all of our citizens. We need to do all we can to help create new jobs and get our citizens back to work.
With great respect for your service on behalf of the citizens of the Commonwealth.
Sincerely,
Robert F. McDonnell.
