Texas AFL-CIO President Becky Moeller today issued this statement on the Unemployment Insurance debate at the Texas Capitol:

 

  “In a sinking economy, the livelihoods of tens of thousands of Texans are at stake as unemployment spikes. At the same time, the federal government has offered our state $555 million, but to take the money, the Legislature must make minor alterations in the law to reach a minimal standard of coverage for workers.”

 

  “Those alterations in the law are long overdue and they are a small percentage of the system. In this deep recession, about one in five Texans who lose their jobs will qualify for unemployment insurance benefits. Congress clearly intends to boost the level of unemployment coverage and to provide funds to help workers who have earned a safety net.”

 

  “The decision by Gov. Rick Perry to reject the Unemployment Insurance funds in the economic stimulus package may stop the extension of coverage to 45,000 Texans who would spend the funds in grocery stores and gas stations across the state. It is ironic that the state labor federation must also point out that Perry’s decision is a penny-foolish and pound-foolish tax on employers as well.”

 

  “Unlike our counterparts on the management side, however, the state labor federation is willing to be honest about the Unemployment Insurance system. It is substandard for workers and it is not always fair to employers. Therefore, today we are proposing a two-step process that involves far more than just saying ‘no’ when the federal government comes calling with $555 million.”

 

  “First, take the money, straight up. Yes, the legal changes are estimated to cost up to $75 million a year. To put that in perspective, the trust fund will be paying out approximately $64 million per week by the end of this year. We must recognize that employers will be the first to benefit directly from the $555 million that flows into the state in the form of lower taxes and borrowing costs. Because that $555 million is an up-front payment, it would take at least seven years before any additional expense is borne by the Texas system.  By then, we hope and expect that the economy will be doing well enough to cut employer costs and keep employees off the unemployment rolls.”

 

  “We have no objection if the state combines acceptance of the federal funds with a business-backed proposal to take advantage of a temporary federal loan program that will allow employers to amortize the unemployment insurance deficit over a longer period. We object strenuously, however, to the notion that any reforms must be cost neutral and involve somehow balancing the supposed “cost” to employers by subtracting from already meager coverage for workers. Congress intends to improve the lot of jobless workers and stimulate the economy in communities across this state. We should soundly reject proposals that would place funds in workers’ left pockets only to be picked from the right.”

 

  “The combined effect of our proposed reforms would be to move Texas forward by covering 45,000 more workers, pumping millions of dollars into the Texas economy and minimizing the UI tax for employers over the next decade. If the state does nothing, employers will clearly pay far more in UI taxes, and that tax increase would be laid at the feet of our governor.”

 

  “Second, we support the concept advanced by Sen. Kevin Eltife, R-Tyler, to create a task force that includes all stake-holders in the Unemployment Insurance system. The task force would conduct a complete evaluation – including a close look at modernizing eligibility, reducing waste and identifying best practices across the nation. Subsequent legislatures could address any findings in comprehensive fashion.”

 

  “We believe unbiased research would find merit in expansion of coverage for unemployed workers from the present sorry set of rules. We also would hope that such research might find inefficiencies in the system that can be corrected, thereby saving money without the serious damage to the overall interests of working families that some have put forward.”

 

  “The Texas Unemployment Insurance system needs to be modernized. Taking $555 million to help Texans who have lost their jobs through no fault of their own is an utter no-brainer and a once-in-a-lifetime opportunity.”

 

  “Let’s all do what is right for Texas on this issue.”

 

-30-

 

March 25, 2009

 

  In the part of Texas that I come from, “crawfishing” is a term for backing out of what you have said or promised.

 

  In the debate on whether to take $555 million to help people who are out of work in Texas, we have seen enough “crawfishing” to consume the entire American supply of hot sauce.

 

  On the one hand, our state leaders are assuring the tens of thousands of Texans who have lost their jobs that they will be covered under the state’s Unemployment Insurance system and that not one dime will go unpaid. What they don’t say is that four out of five workers who lose their jobs in Texas don’t qualify for a nickel.

 

  On the one hand, certain elements of the business community assure us that they support benefits for “deserving” workers. But then they also talk about the Unemployment Insurance system as if it is welfare and that a big percentage of payments under the system are fraud.

 

  On the one hand, some politicians say they stand on principle and don’t want federal money with strings attached. What they don’t say is that uncontroversial stimulus funds for programs like roads and Medicaid also have strings attached.

 

  The state of the Unemployment Insurance system in Texas is pathetic. According to the U.S. Labor Department, Texas is 50^th in the nation in the proportion of workers who qualify for benefits. Our business leaders think that’s too high.

 

  This isn’t some abstract cost-benefit analysis. I know too many people who have lost their jobs in the petrochemical industry. Real families in this state are suffering, wondering whether they will be able to earn enough to feed their families, lurching closer to the threats of foreclosure, loss of dignity and despair.

 

  The Unemployment Insurance system should tide over more Texans as they seek work. It’s about common decency. And when an opportunity like this arises, our state should do everything in its power to make it work so that our productive citizens have a real chance to get back on their feet.

 

  It’s a sad day when crawfish become a symbol of how we treat folks who are down on their luck.

 

-30-

 

 

 

March 25, 2009

 

AUSTIN, TX--"Let’s keep the focus of the Unemployment Insurance debate on Texans who have lost their jobs. 

 

 My constituents in the Rio Grande Valley are suffering from unemployment rates that are close to 10% and expected to keep rising. The $555 million available from the federal economic stimulus package would benefit my district and benefit the state by placing many more families on sturdier financial ground and giving employers a large up-front boost so the system may remain fully funded in difficult times. Let's be clear - if we do not take this federal money, businesses will pay higher taxes and families will be unnecessarily denied support during these hard times.

 

The Unemployment Insurance system in Texas is long overdue for revamping. Therefore, I believe Texas should accept the $555 million according to the terms required under the stimulus package, and begin the process of reforming the system so that Unemployment Insurance serves all workers and employers well."

 

 

 

 

 

 

FOR IMMEDIATE RELEASE                       Contact: Kathryn Freeman           

March 25, 2009                                               (512) 463- 0126

 

 

 

 

For Immediate Release                                                            Contact:  Jeremy Warren

March 25, 2009                                                                                 (512)463-0113

 

(Austin)//Senator Rodney Ellis (D-Houston) today released the following statement

 

"The recession has hit Texas.  According to the Texas Comptroller of Public Accounts and the U.S. Federal Reserve, the Texas economy will lose between 180,000 to 300,000 jobs in 2009, and the unemployment rate is expected to rise from 6 to 8.2 percent.   Texas families are hurting and are worried about how they are going to keep their homes and pay their bills.  They want help and they want action, but all they're getting from Austin is political posturing.

 

"President Obama's Economic Recovery Act offers $556 million to Texas to help those Texans who have lost their job or are in danger of soon losing it.  Unfortunately, Governor Perry has said he will reject that funding simply because we would have to make small changes to the program.  This is the definition of penny-wise and pound-foolish.   I doubt Texans think sending a half-billion of our tax dollars to other states while doing nothing to save the state's faltering unemployment trust fund is the best way to pull ourselves from this recession.

 

"In addition, if Texas rejects that money, businesses in our state will suffer the consequences.  Should Texas fail to act, by September 2009 our unemployment trust fund could be $749 million below the floor.  Two things happen then:  an automatic 'deficit tax' will be triggered on nearly all businesses to make up the shortfall; and, funding could end for important economic development programs.

 

"As this economic storm worsens, now is the time to act, not play politics.  I applaud Texas AFL-CIO, USW and the Center for Public Policy Priorities for continuing to lead on this issue and work to reform the unemployment insurance system to help workers and the businesses who employ them."