Senate rejects jobless benefits

Greg Nash

Senate Republicans on Thursday blocked Democrats’ third attempt to pass an extension of federal unemployment benefits.

The Senate voted 58-40 Thursday on a proposal that would have continued unemployment insurance for three months, just short of the 60 votes needed to end debate.

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“I’m beginning to believe there is nothing that will get Republicans to yes,” Senate Majority Leader Harry Reid (D-Nev.) said. “It’s a ‘no’ vote because they don’t want to extend unemployment insurance.”

“We’re one Republican vote away from restoring benefits to 1.7 million Americans,” Reid said. “There is one Republican vote standing in the way of a lifeline to these 1.7 million people.”

Republican Sens. Dean Heller (Nev.), Susan Collins (Maine), Lisa Murkowski (Alaska) and Kelly Ayotte (N.H.) voted with Democrats to end debate. Sen. Rob Portman (R-Ohio), who was involved in the bipartisan negotiations, said he couldn't support the deal because he believed the pay-for "put taxpayers at risk."

Democrats say they plan to use Republican refusal to pass a short-term extension of the benefits as a weapon in the midterm elections.

Nearly 1.3 million people lost their long-term unemployment benefits at the end of December. The benefits, first put in place during the financial crisis, took effect for people when state-level assistance ran out.

The White House slammed Senate Republcians and accused them of denying a "vital lifeline" to the unemployed.

"We cannot allow one vote to stand in the way of supporting these Americans as they struggle to find work. Both sides of the aisle have worked together to prevent this kind of hardship in the past, and neglecting to do so now is unacceptable — especially given the high long-term unemployment rate," White House press secretary Jay Carney said in a statement.

Democrats tried and failed to pass a three-month extension in January after Republicans demanded that the $6.5 billion cost be offset elsewhere in the budget.

They then tried to pass an 11-month extension that was fully paid for by extending sequestration for an additional year, which would have generated roughly $25 billion for the government. Republicans balked at that plan and demanded an open amendment process.

The latest proposal from Sens. Jack Reed (D-R.I.) and Dean Heller (R-Nev.) would have paid for the extension through “pension smoothing” — a budget maneuver used in the 2012 highway bill.

“This is not a controversial pay-for,” Reed said ahead of the vote. “This is something we’ve embraced before. … It’s been used by colleagues on both sides of the aisle.”

Pension smoothing reduces pension expenditures for companies in the short term by creating more taxable income. The measure would use this accounting procedure for four years to produce the $6.5 billion needed to cover the three-month benefit extension, and Reed said it would generate $1.2 billion that would go toward deficit reduction.

But some Republicans decried the practice as a budget “gimmick” that risks greater liability in the long run.

The Reed proposal also includes an amendment from Sen. Tom Coburn (R-Okla.) that would prevent millionaires from collecting unemployment benefits.

But Senate Minority Leader Mitch McConnell (R-Ky.) said Republicans want the chance to make more changes to the bill.

“We have a number ideas on this side of the aisle to promote economic growth,” McConnell said Tuesday. “So I ask the majority leader to modify his request to have an orderly, open amendment process.”

Republicans have criticized Reid for rarely allowing amendments on legislation before filing cloture. They say not having an open amendment process gives them no voice in the chamber, forcing them to “sit down and shut up.”

Reid counters that an open amendment process would simply be a way for Republicans to obstruct legislation.

“And every week [Republicans] delay, another 73,000 Americans lose these crucial benefits — benefits that help them keep food on the table and a roof over their heads while they search for a job,” Reid said.

As a procedural move, the Senate also voted on whether to end debate on the underlying bill, S. 1845, which is an unpaid for three-month extension of unemployment insurance. That motion failed on a 55-43 vote.

— This story was last updated at 3:38 p.m.