Legislation to Extend Unemployment and Payroll Tax Cut Stalled in Congress

While lawmakers bicker, ordinary Americans worry about the toll inaction could take on their wallets.

Posted: 12/15/2011 02:11 PM EST
Barack Obama

John Alexander, 23, has mad skills. The University of North Carolina School of the Arts graduate is a lighting designer who has worked on productions in several of Washington, D.C.’s best theatres, including the Kennedy Center for the Performing Arts. But to execute his craft, he must work as a freelancer, which is how one gets started in his field. So far, he's been able to earn a living but is by no means making mad money. If Congress fails to extend the payroll tax cut that expires at the end of the year, the ensuing tax increase would hurt Alexander's bottom line.

 

A typical household could end up paying an additional $1,000 per year in taxes. That’s not much money to congressional lawmakers who are bickering over how to pay for the tax cut. But to Alexander, any increase could force him to move back home.

 

“There’s no way I can afford any kind of increase, especially a thousand dollars,” said Alexander, whose sights are set on Broadway. “A thousand dollars would cover my rent, my cell phone bill and my commuting expenses.”

 

Legislation that would extend the payroll tax cut and federal unemployment insurance programs is currently stalled in the Senate. The House passed a bill Tuesday night that most Black lawmakers voted against in part because it reduces by 40 weeks the amount of time an individual can receive unemployment benefits and also would require recipients to undergo drug testing. President Obama has issued a veto threat because it would force cuts in such areas as education and clean energy to pay for the measures. More than six million people could lose their benefits and 160 million would pay more in taxes next year if Congress doesn’t act.

 

Minnesota Rep. Keith Ellison told BET.com that he wants to support both programs, but the cost the GOP is asking is too high.

 

“It’s insulting and abusive to demand a drug test from people who’ve done nothing wrong other than being unable to find a job. It would disproportionately affect Blacks because the rate of unemployment is so much higher so the need for [benefits] is higher,” he said. “Herman Cain said, ‘If you don’t have a job or aren’t rich, blame yourself’; this is emblematic of that idea on their side that there’s something blameworthy about being out of work.”

 

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(Photo: Kevin Lamarque/Reuters)

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