NY Struggles To Help The Unemployed, Borrowing From Feds To Keep Going

Unless you're living in a cave (or an ivory tower) it is hard to escape knowing how bad things are in these times. The economy is suffering like no other, thanks to the greed and mismanagement of those in the elite, coupled with the outrageous lending practices that they encouraged among everyone else.

Here in New York, like all the other states of our union, Americans are joining the ranks of the unemployed at an alarming rate. The latest numbers showed a U3 rate above 7%, while the combined rate of the underemployed is way above 13%. The government only pays benefits to laid off workers for six months (and for some in these times, nearly a year) but the addition of so many pink-slip laden workers has overwhelmed New York.

From The NY Times:

New York State’s unemployment insurance system, besieged by claims from laid-off workers, ran out of money on the first business day of the year and is borrowing daily from the federal government to bridge a fast-growing and potentially huge deficit, state labor officials say.

Despite paying lower benefits to its jobless residents than other Northeastern states, the state’s unemployment fund has been borrowing about $90 million a week from the federal unemployment trust fund, state officials said. The deficit has already reached $212 million and is expected to exceed $2.5 billion by the end of 2010, they said.

State officials say that the deficit does not threaten the continued payment of benefits.

But the loans could wind up costing the state’s unemployment fund more than $100 million in interest and could result in a punitive tax on all employers across the state two years from now, state officials and experts on the unemployment insurance system said.

Not only are times troubling for those out of work, but the state's system to handle the problem as well. Legislators should see this failure as an opportunity to rebuild a process that will stand up to the challenges we face. For too long the burden of maintaining our society has been slowly shifted onto the middle class. While we all must share in getting through these times, it is only fair that the wealthy among us do the same. If we are to have corporate welfare, there must at least be an equal amount of welfare for the rest of us, or else, eventually something will have to give.