States Hobbled By Unemployment Bills

CBS Evening News: Four States' Jobless Benefit Funds Already Underwater; 14 More At Risk

(CBS)  One fallout of the economic crisis has been the rise in unemployment, which stood at 7.2 percent in December.

More than 4.6 million Americans are now receiving jobless benefits, and that's putting a serious squeeze on state budget, reports CBS News correspondent Michelle Miller.

Twenty-six year-old Michelle Bozikova was laid off in early December. Since then she's been e-mailing resumes - about 100 so far, she says - and receiving unemployment checks.

She's now in the ranks of more than half a million New Yorkers collecting unemployment benefits - three times the number from last year.

"New York's unemployment insurance fund went insolvent about two hours into 2009," says Patricia Smith, commissioner of the New York labor department

Since Jan. 1, that flood of jobless claims has forced New York and four other states-South Carolina, Indiana, Ohio and Michigan - to borrow money from the federal government to pay benefits. Fourteen more states are at major risk of breaking the unemployment bank in the next year.

"Many states just didn't think we were going to have a recession this severe and didn't build the savings," says Andrew Stettner, deputy director of the National Employment Law Project.

If states don't pay back the loans by Sept. 30, they'll have to start paying interest. In New York's case, that could mean $100 million in interest payments by 2010.

"What's going to happen to employers in that state is the federal tax is increased on them to get the money back," Stettner says. "So the feds are going to get the money back one way or another."

An under-funded unemployment system is creating other problems, too. In a state like New York where the cost of living is already high, premiums haven't kept up with inflation. About two dozen other states pay higher benefits, including Kansas and Iowa.

Michelle Bozikova is receiving $405 a week - less than half of what she made in her job as a sales rep for a hotel chain.

After past failures, New York lawmakers are pushing legislation to raise benefits and increase fees paid by employers. But labor department officials are already looking ahead."

"After this type of unemployment crisis, about a year later, you'll see a spike in welfare cases," says smith.

With the clock ticking on her benefits, Michelle Bozikova is working hard to ensure she's not one of them.

[wardoglrs]

"Reform cannot be achieved by a well-intentioned leader who recruits his followers from the very people whose moral confusion is the cause of the disorder." - Socrates

The Democracy will cease to exist when you take from those who are willing to work and give to those who would not


%u201CThe danger is not that a particular class is unfit to govern. Every class is unfit to govern%u201D
Lord Acton.

"A wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicity." - Thomas Jefferson, First Inaugural Address

If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." Thomas Jefferson, Letter to Treasury Secretary Albert Gallatin (1802)

[noloyalisti]

Repeal the Bush tax cuts, immediately. All that was was welfare for the rich and has not done ANYTHING for the United States.

[otiswestfall]

If we could get out of Iraq this year, we might have some money to pay unemployment benefits.

[lochlan-2009]

Unemploy them until they are all signing up for the military, just to get a meal. Who are we going to kill them in war with though? Oh yeah, Afghanistan. Why are we fighting them again? To get BinLaden, or is it those little training camps (that are all over the world)?

[zekeboy1]

Can we stop whing about the democrats, please? When the Republicans took control of congress in ''94 is when this mess shifted into overdrive. The deregulation that they demanded (and got; Phil Grahm(sp)on the floor of our U.S. Senate...remember?) was the catalyst for what we now have. Allow companies, bt changing the law, to ''gobble'' up their competition, and then ride in on their great white steeds and declare that dereg. creates competition which drives the price down.(Not if you''ve allowed them to buy up the competition)And what he vehemently stated about deregulating the banks...come on.
Further,looking ahead a bit.... What alot of manufacturing companies are doing now, dealing with layoffs etc. due this major downturn may actually lead to a resurgence in labor unions in this country. They all seem to be changing their own rules as we go dealing with issues of seniority, sick days, vacations, etc.
Bottom Line? When I hear questions such as ''Is capitalism dead?'' Believe me, the type of capitalism I''ve seen over the last several years... I hope it is!
It''s a poison that in itself seems to protect the very ones who practice it.

[rsolaz]

STOP WITH THE OBAMA STUFF...LIKE HE IS OUR SAVIOUR! PRESIDENT BUSH WASN''T ALL BAD...AND I SAY WE RESPECT THE PERSON WHO IS IN THE OFFICE NO MATTER HOW WE FEEL ABOUT IT, AFTER ALL WE DID ELECT PRESIDENT BUSH. GIVE HIM THE SAME RESPECT THAT YOU ARE NOW HAILING TO OBAMA. PRESIDENT BUSH KEPT THE TERRORISTS AT BAY, BY SENDING TROOPS OUT. HE DID DO SOME GOOD, NO MATTER WHAT OTHERS THINK. REMEMBER THIS IS ONE PERSON WHO YOU EXPECT TO CHANGE THE WORLD. ALTHOUGH OBAMA HAS SOME GOOD CAUSES, DON''T EXPECT HIM TO BE ABLE TO MAKE THOSE CHANGES. CLOSING GUANTONIMO BAY...WHAT IS HE OUT OF HIS MIND?!!!

[wvu74621]

Is it me or did the democrats control congress for the past several years?

[estabwary]

"After this type of unemployment crisis, about a year later, you''ll see a spike in welfare cases," says Smith.


Do we want to keep pushing the ineffective, wasteful, abstinence agenda now?

[hillaryin016]

ObamaScamMan? Why are you breathing? remember BUSH created this mess. Why are you dumping on Obama? He is ONLY trying to make things good. It is people like you that OBVIOUSLY have communist views that do NOT belong in our belief system of American Ideals.


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Posted by swingset4u at 11:19 PM : Jan 25, 2009

We support the President but not his war. Sound framilure?

[hillaryin016]

Less than six months into a recession and the states are running out of money for unemployment benefits? What did they do with the money employers pay every month? Especially for the last three decades when he had low unemployment. Where''''s the rainy day fund? Where is some fiscal competence and responsibility? We''''ve all been paying the money, WHAT DID OUR GOVERNMENTS DO WITH IT? Why are people that can''''t balance a checkbook allowed within ten miles of state treasuries? What did we hire you for? THESE are the people that should be in jail, the legislators that keep spending our money leaving us no cushion for bad times. Irresponsible bas%$#@*!


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Posted by hdc77494 at 12:33 AM : Jan 26, 2009

Didnt your Socialist leaders tell you? Those funds are for condoms, needles and funding abortions overseas now.........

[hillaryin016]

With this statement you are in essence saying you wish for America to fall into further decline or even to distruction. With every failure of a president, the country suffers in some way. Your wishing Obama to fail makes me wonder where you are from and if your allegiance is actually to America. I may not like any particular president, I may even disagree with their policies but I would never wish them failure. Especially since that failure could have serious repercussions to the entire nation.

Posted by jbp_angel

we support the President, not his programs......sound framilure?

[hillaryin016]

You can thanks Bush and the republican congress for the coming depression.


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Posted by StLouBill at 09:41 PM : Jan 25, 2009

Is that why Obama is sending us taxpayer dollars overseas to fund abortions?

[hillaryin016]

States Hobbled By Unemployment Bills
CBS Evening News: Four States'' Jobless Benefit Funds Already Underwater; 14 More At Risk

And Obama sends US taxpayer money overses to fund abortions.......the left says nothing.

[hdc77494]

Less than six months into a recession and the states are running out of money for unemployment benefits? What did they do with the money employers pay every month? Especially for the last three decades when he had low unemployment. Where''s the rainy day fund? Where is some fiscal competence and responsibility? We''ve all been paying the money, WHAT DID OUR GOVERNMENTS DO WITH IT? Why are people that can''t balance a checkbook allowed within ten miles of state treasuries? What did we hire you for? THESE are the people that should be in jail, the legislators that keep spending our money leaving us no cushion for bad times. Irresponsible bas%$#@*!

[swingset4u]

ObamaScamMan? Why are you breathing? remember BUSH created this mess. Why are you dumping on Obama? He is ONLY trying to make things good. It is people like you that OBVIOUSLY have communist views that do NOT belong in our belief system of American Ideals.

[liberalme]

With this statement you are in essence saying you wish for America to fall into further decline or even to distruction. With every failure of a president, the country suffers in some way. Your wishing Obama to fail makes me wonder where you are from and if your allegiance is actually to America. I may not like any particular president, I may even disagree with their policies but I would never wish them failure. Especially since that failure could have serious repercussions to the entire nation.

Posted by jbp_angel

Baghdad lives in Brazil and once worked for Saddam building roads---at least that''s what he''s said, also he got paid well.

[allzwell]

Your talking about three years for this final solution. But first the depression has to hit in about 3 or 2 months. Are you ready?

Posted by ObamaScamMan at 09:25 PM : Jan 25, 2009

...and who''s fault is that? YOUR''S. Slime ball republiCON, slither back into your hole. Loser.

[stloubill]

You can thanks Bush and the republican congress for the coming depression.

[geneonlbk]

Incompetence everywhere we look. We as a nation need to completely flush all "civil servants" and hire people whose IQ cannot be measured using a tire gauge.

[swingset4u]

I don''t get it. If you don''t put anything in you don''t get anything out. Why is it that these states unemployment account bankrupt? It is called insurance and should be made available and USED for just that, unemployment. More politics...