Picture of America’s Priorities
Two reports came out last week that paint a graphic portrait of America’s questionable priorities.
The General Accounting Office (GAO) reported that for tax year 2010 (the most recent information available), profitable U.S. corporations paid U.S. federal income taxes amounting to about 13 percent of the pretax worldwide income that they reported in their financial statements. This is, of course, well below the U.S. statutory corporate tax rate of 35 percent.
The second report was from the National Employment Law Project, which found that across-the-board federal budget cuts known as sequestration have resulted in a 15 percent loss of federal benefits to the nation’s long-term unemployed. The average weekly payment for workers who have been out of a job longer than six months was cut from $289 to $246. That reflects a total loss of $172 in their monthly income.
“Congress’s first priority should be job creation and restoring opportunity through work for the millions who remain unemployed,” said NELP Executive Director Christine Owens. “Yet Congress has made an uphill climb for the long-term unemployed even steeper.”
The federal budget cuts took effect in March and cut $2.4 billion from the benefits paid to the long-term jobless under the Emergency Unemployment Compensation (EUC) program. The program pays jobless benefits to unemployed workers who have exhausted state unemployment benefits, which typically have a 26-week limit.
Maryland was among the states facing the deepest cuts because of the sequester. Average weekly benefits there were slashed from $325 a week to $253 — a 22 percent cut.
Besides Maryland, the states with the highest-percentage reductions for EUC benefits are New Jersey, where payments are down 22.2 percent; Montana, where they are down 19.6 percent; and Connecticut, where they were slashed by 19.2 percent
In North Carolina, lawmakers chose to end all federal EUC benefits on July 1. The move cut off emergency jobless payments to an estimated 70,000 people, even though the state has the fifth-highest unemployment rate in the nation.
Who are they?
The nation’s unemployment rate includes individuals who are in the labor market but does not capture underemployment—the eight million part-time workers who would rather be working full-time. Additionally, there are 6.8 million discouraged workers who want to work but who have stopped looking. NELP estimates there are 27 million unemployed or underemployed workers—over two times more than the official number.
Here is a NELP chart that sheds light on the characteristics of the long-term unemployed: :
NELP reports that older unemployed workers suffer the highest percentage of long-term unemployment of all age groups, with more than half of unemployed workers ages 45 and older out of work for longer than 27 weeks.
Older unemployed workers, many with mortgages and families to support, cannot save for retirement and are more likely to fall back on already strained disability, medical, and income support programs.
According to NELP, the United States is approaching the sixth straight year of continuous high unemployment.