The fund that pays unemployed Texans is close to insolvency. To deal with the impending critical situation, the State of Texas has recently asked the federal government for a $170 million loan to keep benefits going to those who need it. There are two points here that everyone needs to know however. 1) We knew it was coming and 2) our governor played politics at the cost of the unemployment insurance fund.
Back in March of 2009, Gov. Perry rejected $556 million in federal bailout (keep in mind Austin has accepted over 16.5 BILLION in total so it was NOT a matter of financial principle). The funds were rejected because of changes to state rules that were attached to the federal money. The changes were mostly related to updating benefits so that more women, elderly, and students could qualify. It also required the state to consider recent wages in calculating benefits (currently TX can ignore current wages as far back as 18 months!) But as you can predict, our Governor cited reasons of placing too much burden on businesses.
The tragic reality of the mandated changes is that they were not required to be permanent changes. The state had the option to reverse the changes in two years.
The decision was political, as can be evidenced in the fact that Rick Perry was not alone in his decision. A number of Republican Governors who rejected unemployment funding including Bobby Jindal (LA), Haley Barbour (MS), Bob Riley (AL) and Sarah Palin (AK) have joined Perry in turning down extra unemployment insurance money.
We need to keep fighting for those who do not have the same privileges shared by those more fortunate among us. On this issue, TX sadly sets a precedent in that it covers the smallest percentage of unemployed workers of any state (4 of 5 unemployed workers are eligible for NO benefits!)
Pennsylvania Gov. Ed Rendell said it best: "There comes a time when the hurt that individuals are facing becomes paramount over whether I'm going to have a budget problem three years down the road."
References:
Dallas Morning News
NPR
Recovery.org
