Monday, September 28, 2009
Right decision was made on unemployment
From the RoundTable blog
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Keith D. Cheatham
Cheatham is the vice president of government affairs for the Virginia Chamber of Commerce in Richmond.
As a spokesman for the Virginia business community, I wanted to respond to your Sept. 18 editorial piece "The price of intransigence," taking certain members of the Virginia General Assembly to task for doing exactly what the business community asked them to do.
Certainly your paper followed the developments leading up to the veto session in April where most every business group in Virginia asked the General Assembly to reject accepting $125 million in short-term federal monies in exchange for permanently expanding benefits, and business costs, during a recession.
In the House, 50 Republicans, two independents and one lone Democrat listened.
It's been a few months since April, but we still think they got it right.
Because of a recession that's been deeper and wider than most predicted, and because of increased federal spending on unemployment programs, many states' unemployment insurance trust funds are already broke, as is the federal trust fund. The federal trust fund is now running on money borrowed from the federal general fund. This is not a sustainable situation, but that's another story.
The new news here is that Virginia's trust fund is now predicted to go bust sooner, rather than later, but the $125 million would have not helped much. It may have bought us five weeks of breathing room, but then we would have needed to borrow still more to pay for the new, expanded benefits, estimated at $20 million a year.
All of this is more than the typical reader may need or want to know, but they should know this: When the state trust fund goes broke -- and it would have with or without the $125 million -- and when we start borrowing from the federal government, and we will -- now sooner than later -- not one eligible unemployed person will lose a penny of benefits. Virginia employers will step up, as they have done in the past, and foot the bill to make sure that doesn't happen.
Virginia employers will honor their commitment to making sure that those who are unemployed through no fault of their own and who are looking for full-time employment will receive their benefits -- all of them and on time.
As for the $125 million left on the table, we are hopeful that the Congress will respond just as favorably as the General Assembly did earlier this year and make this money available to Virginia's depleted trust fund -- now, without requiring Virginia to expand benefits as a condition to receiving the money. It worked so flawlessly a few years ago that few people noticed the $215 million dropped into the Virginia account, and spent on benefits.
