Sorting out the truth amid unemployment compensation bickering
If we have to blog one more lob in this week's tit-for-tat between Democrats and Republicans on the whole unemployment compensation/federal stimulus deal, we might pull our hair out.
So we talked to Amy Baker, the state's chief economist, to try and bring this partisan finger-pointing to a conclusion.
Baker's conclusion is that the state's odds of finishing the legislation and paperwork required to even get the federal dollars into state coffers on time were doubtful. And had the money gotten in on time, it would not have prevented the looming hike in unemployment compensation taxes - it would have blunted the hike, though.
Here's the deal: For December, the state's unemployement compensation fund is projected to be at a $1.2 billion deficit (thanks to all those additional unemployed Floridians now collecting ...). Had the $444 million in federal stimulus dollars been received, the deficit would have been $760.5 million.
Any deficit triggers an increase in the unemployment tax that businesses pay. So there would have been a higher tax whether or not House Republicans voted to take the D.C. money. The question is, how much more will it be now that the state doesn't have the money.
Baker and the economic experts in her office are still figuring that out.
So in conclusion, the Dems have a point but are exaggerating the numbers. The extra money was no silver bullet.
Oh, and here's what the Florida Chamber has to say about the matter:
“To be clear, accepting these federal funds would have increased the current deficit, as it included a mandate to allow more individuals into the unemployment compensation benefits program that don’t currently qualify," said David Daniel, the Chamber's lobbyist. “This short-term influx of federal money may sound appealing on a press release, but the long-term problem would have been worsened due to the costly strings attached. The Florida Chamber of Commerce thanks Governor Crist, Senate President Atwater and Speaker Cretul for focusing on long-term solutions for our economic recovery and transition.”
“Florida’s employers would much rather lower unemployment compensation costs the right way – by getting Floridians back to work.”