Senate to vote on jobless benefits bill

Senate Democratic leaders will try to push through a one-year extension of federal unemployment benefits sometime Tuesday, although they are still expected to lapse at the end of the day, sources told The Hill. 

Senate Finance Chairman Max Baucus (D-Mont.) is expected later Tuesday to ask for unanimous consent to pass a $56.4 billion bill that would provide benefits through the end of 2011. 

The measure, which was introduced Monday night, isn't expected to pass, but will launch debate in the Senate on the contentious issue. 

Baucus told The Hill on Monday that he "will try every way I can to get this passed."  

Although he will attempt to pass the bill as a stand-alone measure, it's more likely to become part of a larger tax or other legislative package. 

The federal program provides jobless benefits for those whose 26 weeks of state benefits have ended, up to 99 weeks in states with the highest levels of unemployment. 

After its expiration today, more than 800,000 people will see their unemployment checks evaporate by the end of next week. That number will increase to 2 million by the end of December. 

Baucus, along with economists and the Congressional Budget Office, have said that with a 9.6 percent unemployment rate and 14 million unemployed, the benefits provide a much-needed "economic stimulus," especially heading into the Christmas holidays. 

A recent Labor Department report shows that for every dollar spent on unemployment insurance, two dollars are reinvested into the economy. 

Regardless of those reports, shorter extensions have struggled to gain enough support in the past, especially from Republicans and some Democrats who argue that the bill should be offset so it doesn't add to the deficit.

Senate Republicans held up a bill for nearly two months during the summer. 

Outgoing Rep. John Shadegg (R-Ariz.) said Tuesday morning he would vote for a paid-for extension of unemployment benefits only if the expiring Bush-era tax cuts also are extended. 

"If they were paid for and if we extend the tax cuts," Shadegg said this morning on MSNBC's "Morning Joe." "And I'm sorry that you can't see that helping people with unemployment and not enacting massive new tax increases, which will damage the job-creation market, are linked. They make sense together."

Shadegg got into a heated discussion with MSNBC's Mike Barnicle over the economic benefits of extending unemployment insurance and whether consumer spending, which accounts for about 70 percent of economic activity, is boosted when the benefits are in place. 

The retiring lawmaker argued that unemployment benefits aren't an immediate benefit to the economy. 

"No, they're not," Shadegg said. "Unemployed people hire people? Really, I didn't know that ... so your answer is it's the spending of money that drives the economy, and I don't think that's right. It's the creation of jobs that drives the economy," he said. 

"They'll spend as little of it as they can because they'll hold onto it as long as they can. But in reality, they don't create jobs."

The lame-duck battle over unemployment benefits and tax cuts could magnify the starkness between the estimated $56.4 billion price-tag for one year of jobless insurance and a $700 billion addition to the deficit to extend tax cuts for those in higher tax brackets.

President Obama and congressional leaders said Tuesday they will work together on a compromise on the tax cuts. Obama will dispatch Treasury Secretary Timothy Geithner and Jacob Lew, head of the White House budget office, to work with Republicans on the issue. 

Rep. James McDermott (D-Wash.), a House leader on the benefits issue, vowed to disseminate the implications of voting for tax cuts and against an extension of benefits.