Jobs Data Gives Hope for Benefits Extension
WASHINGTON — The surprisingly weak December jobs report might have strengthened Democrats’ hand in the current fight over emergency jobless benefits for the long-term unemployed even as it weakened the party in the larger midterm election battle.
On Friday, the Labor Department said that the unemployment rate dropped to a five-year low of 6.7 percent. But the economy added only 74,000 jobs, and for every American who found work, five disappeared from the labor force.
With a Senate showdown set for Monday night on legislation to revive expired benefits for 1.3 million out-of-work Americans, those numbers handed Democrats a cudgel to break Republican resistance. The number of Americans out of work for more than six months and actively job-hunting stands at 3.9 million. In addition, about 347,000 Americans dropped out of the labor force in December.
Long-term unemployment is “one of our nation’s most immediate and pressing challenges,” said Jason L. Furman, the chairman of the White House’s Council of Economic Advisers. “Despite an abundance of evidence indicating that this challenge is far from solved, Congress allowed extended unemployment insurance to lapse at the end of 2013, cutting off a critical lifeline to those who lost a job through no fault of their own and are still searching for work.”
“The debate will be further charged by these very important numbers, but the White House has a tough sell here,” said Representative Charlie Dent, Republican of Pennsylvania and a key swing-vote moderate. “On the one hand they say the economy is getting better. On the other, they need emergency unemployment benefits. The two can’t coexist.”
In the larger political picture, the December jobs report started the 2014 election year with a thud for President Obama, with half of Americans disapproving of the job he is doing and Democrats facing a tough “six-year itch” election. Since World War II the party in the White House has lost, on average, 29 seats in the House in its second midterm. Democrats were already struggling to recover from the Affordable Care Act’s disastrous rollout.
“Until and unless the public becomes more enthused about their economic future and accepts the economy is getting better, that’s a big problem for the White House,” said Stuart Rothenberg, editor of the nonpartisan Rothenberg Political Report. “Laying these numbers on top of Obamacare and the six-year itch, gosh, that is a deep hole to crawl out of for the president and Democratic candidates.”
Democrats have tried to harness middle-class families’ frustrations with the pace of economic growth by accusing the slow recovery in part on Republican recalcitrance.
But Republicans have become more vocal in pinning the weak economy on President Obama — and have argued that Congress needs to pave the path for businesses to make more jobs, rather than what they see as the Democrats’ approach of simply making poverty or unemployment more comfortable.
“We have been trying to focus this Congress on getting back to a more optimistic view of what the economy can do,” said Representative Eric Cantor of Virginia, the House majority leader. “It is about jobs. It is about growth. Our focus is about wanting people to get a job. It’s on employment, not unemployment.”
For Democrats, even a short-term victory on extending unemployment benefits is looking like a long-shot. The six Republicans who voted Tuesday to bring an unemployment bill to the Senate floor ended the week furious that Senator Harry Reid of Nevada, the majority leader, had shut them out of any negotiations to reshape the bill. A loss of two of them on Monday would leave Democrats without the supermajority needed to keep the bill alive, dashing Mr. Reid’s hopes to extend the expired benefits through mid-November.
Senator Dan Coats of Indiana, one of those six, said the group continued to negotiate together and with Democrats to see if some changes could be made to the unemployment bill to keep them on board. Senator Susan Collins, Republican of Maine, spent much of Friday on the phone with Mr. Reid, hoping for a breakthrough on Monday. But the senators are smarting over what they see as rough treatment at the hands of the leader.
“I don’t think we should let that be the deciding factor; you don’t want to subject good policy to hurt feelings,” Senator Coats said Friday. “On the other hand if the leader has told you, this is not a one-off — he pretty much said, ‘Forget about offering amendments on anything as long as I’m leader’ — what good does it do to negotiate anything?”
Even if the measure does clear the Senate, House Republicans say they simply do not feel much pressure to take it up. Mr. Coats said the job numbers weren’t great, but continued job growth, even sluggish growth, dissipates the pressure to act.
Republicans argue that the jobs report underscores that Mr. Obama’s economic policies have failed, and that Congress should focus on spurring businesses to hire, in part by reducing regulatory requirements and cutting taxes. The price for House action would be steep, Republicans say, citing as options approval of the Keystone XL oil pipeline and repeal of a tax on medical devices, which helps pay for the health care law.
At the end of the year, the emergency federal program abruptly expired, cutting off about 1.3 million workers who have been out of a job for more than six months. After the benefits expired, the proportion of jobless Americans receiving unemployment insurance payments fell to its lowest level in more than 50 years.
Democrats have promised to continue to push for the extension, saying that millions of jobless workers still need the government lifeline. “The safety net has been just ripped away,” Mr. Reid said at a news conference this week. “The economy’s improving, but not for everybody.”
Whatever the short-term outlook, the underlying performance of the economy continues to leave millions of working age people so discouraged that they no longer even bother to look for a job. “What we’ve been seeing over the past year is very steady modest job growth,” said Erica L. Groshen, the commissioner of labor statistics, speaking before a congressional panel on Friday. “Yet there’s still a long ways to go.”