Washingtons focus on the fiscal cliff -- a potentially disastrous combination of tax increases and spending cuts scheduled to go into effect Jan. 1 -- has shifted attention away from the biggest problem in the economy, which is the more than 12 million Americans still unemployed. More than 5 million of them have been sidelined for more than half a year, which means theyre no longer receiving unemployment insurance benefits from their state. Instead, many are receiving extended unemployment benefits paid for by the federal government. Unless Congress agrees to renew the program, however, that support will end as well, even before the country reaches the fiscal cliff.
It would be tragic if Congress abandoned the unemployed in order to clip a relative smidgen off the deficit -- about $30 billion of a deficit of $1 trillion. According to the most recent federal survey of job vacancies, there were about seven applicants for every two openings. Thats an improvement over the worst days of the recession, when the ratio of applicants to openings was more than 10 to 2. But it still means that there arent nearly enough jobs available to put everyone back to work, especially when you consider the more than 9 million Americans who are either stuck in part-time jobs when they want full-time work, or whove become so discouraged theyve dropped out of the work force.
Nevertheless, Republicans and Democrats have battled for more than two years over how to offset the cost of the benefits, and more recently whether to continue funding them at all. Theres a legitimate debate to be had over whether the country should continue borrowing money to pay for unemployment benefits. But the usual argument for cutting off benefits is risible when there arent enough jobs to take.