Dear Member of Congress:
On behalf of the362,000 members of the National Taxpayers Union (NTU), I urge you to supportthe Jobs Opportunity, Benefits, and Services Act (JOBS Act). Introduced as H.R.1745 by Representative Camp (R-MI) and as S. 904 by Senator Hatch (R-UT), thislegislation would give states flexibility in allocating unemployment insurancefunds to get citizens back to work as well as prevent job-crushing taxhikes.
Since the recession began in2007, states have found themselves in a self-defeating cycle of higher taxesand reduced job growth. In an effort to replenish their drained unemploymentinsurance (UI) funds, unemployment taxes have soared by 44 percent in the lasttwo years and more than two-thirds of states have indicated they will raisetaxes on businesses next year. These already-enacted and looming tax hikes havedampened job creation activity, causing states to lean ever-harder on thecrutch of federal funds. Adding to this unproductive cycle, 33 states with insolventunemployment trust funds have borrowed more than $46 billion from the federalgovernment in order to continue paying benefits.
The JOBS Actwould allow states that have been constrained by one-size-fits-all federalrules to finally break this cycle of dependence. States are set to receive $31billion in remaining temporary federal unemployment funds, but have very littlediscretion in how it is spent. The lack of flexibility has reduced states’ability to tailor proper responses to their unique employment and debtsituations. North Dakota, for instance, with a 3.3 unemployment rate and nooutstanding loans from the Federal Unemployment Account, has vastly differentneeds compared to California with 11.9 percent unemployment and nearly $11trillion coming due.
H.R. 1745 and S. 904 would allow statesto put their share of the remaining federal funds toward a menu of optionsdesigned to fit their individual circumstances. Whether it be throughcontinuation of current benefits, paying down federal loans, or investing inmore training and job placement efforts, this bill opens the door to innovationwhile reducing the pressure (especially political pressure) to impose harmfultax increases. The JOBS Act also strengthens job search, education, andtraining requirements as a stipulation of receiving aid.
Ultimately,Congress should reexamine the fundamental structure and economic assumptionsunderlying government UI programs. In the meantime, the tab is set to becomedue on federal unemployment loans, making the status quo unworkable for manyjob-seekers, businesses, and state governments. Rather than continue with aninflexible program that has conjured up the specter of higher taxes, the JOBSAct allows states to search for innovations that could help get their citizens backto work. For the aforementioned reasons, NTU is pleased to endorse thisimportant legislation.
Sincerely,Brandon GreifeFederalGovernment Affairs Manager
108 North Alfred Street Ø Alexandria,Virginia 22314 Ø Phone: (703)683-5700 Ø Fax: (703)683-5722 Ø Web:www.ntu.org