This article first appeared in the St. Louis Beacon, March 2, 2009 - The Missouri chapter of the National Federation of Independent Business is lauding what it sees as a signal by Lt. Gov. Peter Kinder and top GOP legislators that they won't allow the state to accept federal stimulus money designed to expand unemployment coverage.
But it's unclear if Missouri Republicans are willing to go that far.
“The Legislature is doing the right thing by refusing the $130 million for federal unemployment assistance,” said chapter state director Brad Jones in a statement sent out today. “It’s hard to turn down that kind of money, especially when other states are taking it, but this money is the gift that keeps on giving and its going to be the state's businesses that are giving when this money runs out.”
But officially, the Legislature has taken no vote to reject the money. Jones said in an interview that he's relying on the sentiments expressed in a news conference last week by Kinder, state House Speaker Ron Richard and state Senate President Pro Tem Charlie Shields.
The trio reaffirmed their opposition to using federal stimulus money -- Missouri expects to get about $4 billion -- for ongoing programs, including the extension and expansion of unemployment benefits. Richard prefers to use the federal aid for one-time expenditures.
(However, as the Post-Dispatch's Tony Messenger points out today, federal and state money can be shifted around to comply with that one-time spending pledge, while still taking the federal money.)
Said Kinder last week: “The unemployment compensation fund was created as a safety net, not a way of life. This plan would create an unnecessary burden on businesses and Missourians who have lost their job by no fault of their own.”
Jones said today that he interpreted such statements as a sign that, "In particular, the Legislature objects to stimulus package incentives that could require states to extend unemployment benefits past 26 weeks. Another incentive, one that would provide part-time workers with unemployment benefits under certain circumstances, is also objectionable to the business community."
Jones said in an interview that it's his understanding that the $130 million would extend and expand jobless benefits in Missouri for 18 months to 2 years. That money is separate from another pot of federal money that's being tapped to extend existing jobless benefits.
Gov. Jay Nixon said at a press conference last week that the first checks for an additional $25 a week are going out today, as part of the federal extension of existing unemployment aid. The governor noted that the state's latest jobless numbers, for January, are going up and are exceeding the 25-year high set during the early 1980s.
But even when pressed, Nixon declined to comment on the earlier news conference by Kinder, Richard and Shields.
Also up in the air is whether the state can pick and choose what parts of the stimulus money it can take, and what it wants to refuse. Some Democratic congressional leaders have asserted that states have to accept all of their stimulus share, or none of it. Nixon has said that it makes no sense for Missouri to turn down stimulus money, since that money is being spent regardless. It may just go to other states.
Jones said his group's statement today was to underscore that it will back up Missouri's GOP legislative leaders if they stick to their guns and reject the federal jobless aid.
Expanding unemployment benefits "sounds good at first, but it would cost us money in the long run,” Jones said. “Our Missouri unemployment trust fund is on life support as it is. Expanding the program now would be like pouring water into a full bucket. It would just be too much.”
Missouri's unemployment money is raised via contributions from employers. But Jones said in an interview that that the state's unemployment pot is empty, forcing Missouri to borrow money from the federal government to pay existing unemployment benefits. He said the state already owes the federal government more than $200 million.
