A tax cut or rent? For unemployed it's a no-brainer

Alan Singletary isn't quite sure how he'll pay next month's rent - a bewildering predicament for a middle-aged wage earner used to middle-class security.

An early victim of the recession, the former assistant manager at a Philadelphia Cinnabon was laid off a year ago. He had years of restaurant management experience, and started his job hunt optimistically. His monthly $1,578 unemployment-insurance benefits were plenty to tide him over. But in October, after applying for nearly 500 jobs, his 26 weeks of unemployment benefits ended. Now, he's on public assistance and wondering just how far this downward spiral can go.

Hundreds of thousands of Americans are pondering the same question as effects of the recession overtake social safety nets, and a hoped-for extension of unemployment benefits languishes in Congress.

By June, an estimated 2 million Americans will exhaust their unemployment benefits. More than 1 million have already exhausted them. Their comfortable lives are quickly reduced to a quick financial equation, summed up by Mr. Singletary this way: "I can pay to keep the gas and electricity on, but who can pay the rent when you only get $205 a month?"

In past recessions, Congress has always come to the rescue, softening the hard knocks by extending unemployment insurance (UI) for 13 or 26 weeks. In the severe 1975-76 recession, it was extended by 39 weeks.

Extensions are a political plus for everyone, and they usually have wide bipartisan support on Capitol Hill. In theory, the current situation is no exception - a 13-week extension has already passed, unanimously in the Senate. But, in practice, the House Republican leadership continues to tie it to its economic stimulus package of tax cuts for corporations and the wealthy - something the Senate isn't likely to approve.

The House Republicans reason that without the stimulus package and a healthcare component, the extensions of individual benefits won't do much, says Christin Tinsworth, a spokesperson for the House Ways and Means Committee.

But the wrangling translates into desperate circumstances for the jobless.

"[GOP leaders] know that without holding these workers hostage to the tax cuts, they won't get them," says John Dodds, director of the Philadelphia Unemployment Project. "Everybody's for [the extension], but we can't get it passed."

Each week, 80,000 workers exhaust their UI, according to the Center on Budget and Policy Priorities.

They are people like Judy Conway, a bilingual program director in New York, who has 14 years of management experience. Her unemployment ran out in early December, and she's been forced to borrow nearly $20,000 from her family. Even if she lands a job soon, she's not quite sure how she'll pay it all back.

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