Expiring extension of unemployment to cost us all, at least 37 billion dollars down the drain

[ck4829]

The recovery is weak now--but it could be headed for a major hit that will leave it even weaker.

At the start of 2012, the extended unemployment benefits approved by Congress in December 2010, which cover a maximum of 99 weeks per person, will expire. Though the benefits are hardly lavish--a little more than $300 a week for most recipients--their total impact on the economy is huge, because so many Americans are currently taking advantage of them. Moody's Analytics estimates that when the benefits expire, $37 billion will be taken out of the economy, the New York Times reports. That's enough to exert a significant slowing effect--at a time when the recovery is already a long way from robust.

Government benefits that go to poorer Americans, like unemployment insurance, tend to boost consumer spending more than other kinds of stimulus, because people living paycheck to paycheck have little choice but to spend the money, rather than saving it. So the disappearance of jobless benefits will take money out of circulation when economic growth is seeking to gain some traction.

Indeed, economists say that the withdrawal of jobless benefits will create a major ripple effect on growth as a whole. Consumer spending accounts for around 60-70 percent of U.S. economic activity, economists say. But with so many Americans having lost wealth in the housing bust, spending has been tepid for a while, preventing the recovery from gaining any momentum. Now, the end of the extended benefits will likely soon put a further crimp in spending.

http://news.yahoo.com/blogs/lookout/next-big-hit-economy-133429498.html

[OhioChick]

1. Going to get ugly in many ways n/t

[butterfly77]

2. But,for some reason..

republicons seem to think they are hidden and will not have to pay,and they will one way or the other.

There plan is to do everything possible to back Obama into a corner on every issue and all of his choices have been terrible,their hope is by causing so much turmoil we will vote for them which is the stupidest thing idea because why would I vote for who put us in this situation.

Its all about winning to them they have set in motion or caused a large number of problems in this country and all over the world,so where do they expect to hide.

[lib2DaBone]

3. K/R They have long ago kicked 99'rrs to the trash heap....

No more benefits... $4 a gallon gas... no jobs... a double death blow.

Here's a news flash for all the highly paid Congressmen and astute Senators in Washington: The economy is not "sluggish", the economy is not double dipping, the economy is not getting better".

We are in Depression-II and have been since 2088!

[xphile]

4. Of course this deal didn't do anything for the 99'ers who I suspect are already in dire straits.

But we don't talk about them.