If some of your neighbors don't seem too happy about the new year, it could be because Congress decided to go home and party without extending unemployment benefits.
After patting itself on the back for barely passing a budget deal, Congress left 1.3 million long-term-unemployed Americans without any obvious means of support. Lawmakers didn't include an extension of unemployment benefits in the budget deal, so the program expired on Saturday.
In addition to the current beneficiaries, an extension would have helped another 850,000 people who are expected to have been out of work for more than six months as of March.
The federal aid serves as a backup for people who have exhausted their state benefits, which typically last six months. The program has been extended regularly since 2008, when it was instituted to help victims of the recession and heightened unemployment that followed the financial collapse. The recipients are people who are trying to keep their lives together as they look for work, which they are required to do to continue receiving benefits.
The money shores up families and communities throughout the country. To demonstrate that, the Democratic staff of the House Ways and Means Committee broke down the county-by-county effect of ending extended assistance in Pennsylvania, where 73,000 people lost benefits. They included 11,910 people cut off in Philadelphia. In Montgomery County, 3,650 were out of luck. So were 3,020 in Delaware County, 3,010 in Bucks, and 1,630 in Chester.
New Jersey officials estimate that 79,000 lost benefits in that state. In Camden County, 4,620 lost out; in Burlington County, 3,580; and in Gloucester, 2,280.
Even though national employment looked better last month, it hasn't improved enough to scrap this program. At a national unemployment rate of 7 percent - with New Jersey at 7.8 percent and Pennsylvania at 7.3 percent - too many Americans still don't have jobs. Consider that long-term benefits were extended for the first time when unemployment hit just 5.6 percent.
It's particularly disconcerting that the number of long-term jobless who are still looking for work continues to increase, having reached 2.3 percent of the workforce. Many of these people could fall into poverty. Helping them out of the pit at that point would be far more expensive than extending their unemployment assistance now. In the eight downturns since 1958, long-term unemployment benefits haven't been cut until that figure dipped below 1.3 percent.
The premature discontinuation of these benefits threatens the economy as well as families. Benefit checks are quickly spent on necessities like rent and food, fueling economic activity. According to the Economic Policy Institute, the loss of this $25 billion program could kill another 310,000 jobs.