Senate Democrats unveil new unemployment insurance expansion

Senate Democrats on Thursday introduced a bill that would extend unemployment insurance benefits by 14 weeks at most for jobless Americans in every state.

The new effort -- spearheaded by Senate Majority Leader Harry Reid (D-Nev.) and Sens. Max Baucus (D-Mont.), Jack Reed (D-R.I.) and Jeanne Shaheen (D-N.H.) -- ends weeks of bickering among Democrats over how long the extension would last and who would be eligible for it.

“Chairman Baucus and I worked with our colleagues Senators Reed and Shaheen for the last two weeks to broker an agreement that provides critical assistance to unemployed workers across the nation,” Reid said Thursday in a statement. “This agreement recognizes the need to extend unemployment benefits for workers in every state whose unemployment benefits have run out or will do so in the next several weeks.

Under the new proposal, jobless Americans about to run out of benefits would receive up to 14 additional weeks of unemployment insurance, and those without work in states with unemployment rates exceeding 8.5 percent would receive another six weeks on top of that. Both expansions are paid for in full by an extension of the Federal Unemployment Tax -- a yearly fee employers pay -- until 2011, the four lawmakers indicated.

Ultimately, the compromise addresses concerns among Democrats in states with unemployment rates below the threshold, who argued that the original bill, which passed the House, deprived their constituencies of much-needed help.

“This is good news for jobless workers in New Hampshire and all across the country who want to get back to work, but face a job market where there are six unemployed workers for every job opening,” said Shaheen, one of the original bill's most vocal critics. “Unemployed workers use these benefits to buy essentials and pay the bills. Extending unemployment benefits is one of the most effective actions we can take to stimulate the economy."

Although the revised bill is likely to garner significantly more Senate support than its predecessor, it will have to be reconciled with the House's version prior to reaching the president's desk.