Schwarzenegger, Three Months Late, Lobbies for Unemployment Insurance

By Theresa Cook

Apr 22, 2008 7:45am

ABC’s Z. Byron Wolf Reports: The problem with the economic stimulus package that Congress passed in early February is that three months later the stimulus has yet to kick in.

The backbone of the $146 billion bill is a set of rebate checks for taxpayers and seniors and veterans living on fixed incomes. The tax rebate checks should be coming out in the next several months now that the IRS is done collecting the taxes.

Many economists had pointed to an extension of unemployment benefits as a quicker way to stimulate the economy; it would have gotten money into the marketplace almost immediately as people losing their jobs in the budding recession were able to keep drawing unemployment for an extra amount of time.

Republicans in the Senate saw it differently and blocked an attempt by Democrats to extend unemployment insurance, among other things, back when the stimulus proposal was being considered by Congress.

They argued that unemployment benefits encourage out-of-work beneficiaries from seeking jobs. And there was concern that the debate over the proposals by Democrats in the Senate could delay the stimulus checks.

But times have not improved since that debate in early February and it was a powerful Republican voice calling today for an unemployment insurance extension — California Governor Arnold Schwarzenegger.

In a letter reportedly sent to leaders of both parties on Capitol Hill, the moderate California Governor called for Congress to extend unemployment benefits.

“California has been hit especially hard by the national housing slump and subprime crisis. In the past year alone, we have lost 131,000 jobs in the construction and financial services sectors,” the governor says in the letter. “California’s unemployment rate now stands at 6.2 percent, and it is clear that states cannot fully address the consequences of the national housing downturn on their own.” He argued that nearly half a million unemployed workers in California exhausted their unemployment benefits in March.

Schwarzenegger argues this is a national problem and that Congress should act soon and use federal dollars to extend unemployment insurance.

Earlier this, Schwarzenegger <a href="http://gov.ca.gov/index.php?/press-release/8651/
“>had called on the Senate to move quickly and pass a House of representatives version of the bill that did not include the unemployment insurance extension.

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