Unemployed Americans at center of debate over benefits

Liz Goodwin

How long should out-of-work Americans count on unemployment benefits to see them through hard times? That's the question that political leaders and economists are debating as Congress fights over a stalled plan to extend federal assistance to the unemployed.

Sara Murray at the Wall Street Journal takes an in-depth look at the debate as the Senate weighs whether to pass a scaled-down version of a bill extending unemployment benefits to millions of Americans still  out of work months after losing their jobs. If lawmakers don't pass the extension, an estimated 3.3 million Americans could lose their benefits by the end of July, according to the Associated Press.

This recession marks the nation's highest threshold of long-term unemployment since the Great Depression. In response, Congress has extended jobless benefits for longer than any other time in history, so that the unemployed in some states can receive up to 99 weeks of benefits. The average person on unemployment benefits receives a little more than $300 a week.

Murray notes several studies showing that a person who receives unemployment benefits will be without a job for several weeks longer than a person who doesn't receive those benefits. Economists on the right (and Republican Sen. Jon Kyl from Arizona) argue that extending unemployment benefits again will mean people will be less likely to look for work and more picky about which jobs they take.

But other economists, including Obama economic adviser Lawrence Summers and New York Times columnist Paul Krugman, argue that the economic situation is uniquely dire and invalidates the conventional wisdom on benefits. Now that there are five unemployed people for every new job opening, Summers argues, it's absurd to claim Americans are passing over jobs in favor of a modest monthly unemployment check. Americans can't be too picky about taking jobs, in other words, if the jobs aren't there to be picked over.

As the political and economic elite hash it out, comedian Jon Stewart lampooned the idea that unemployed people are anything but desperate to find a job. "You hear that people who have lost their jobs and are skatin' by on your $1,200 a month? The gravy train is over! Well, not so much gravy as the ketchup packet soup train is over," he joked on Tuesday's episode of "The Daily Show." You can watch the clip here.