Did I ever tell you the story

 

About trying to renew

 

 

My NJ plumbing license seal

 

 

 

It was old and needed to be

 

 

Replaced.

 

 

 

Do you have about an hour?

 

 

 

It is wayyyy tooooooo long of a story

 

 

 

Without going into details

 

 

Let me just say

 

 

After many phone calls

 

 

 

 

It only took the State a year

 

 

To mail out my new

 

 

Plumbing seal

 

 

 

 

 

 

Now the State is treading on sacred ground

 

 

 

 

Each year in late July or early August

 

The State of New Jersey

 

Mails out the

 

 

 

New Jersey Employer Contribution Reports

 

 

 

To all New Jersey Employers

 

 

 

 

This form shows you how the State

 

 

Calculates your new

 

 

Unemployment Tax rate

 

 

For the next 12 months.

 

 

 

 

You have to stay with me here…..

 

 

 

 

The form shows how much

 

Your Company has paid

 

Into the unemployment fund

 

Since inception

 

 

 

It also shows the total amount of

 

Unemployment claim dollars

 

The Company has paid out

 

Since inception

 

 

 

 

Confused yet?

 

 

 

Keep reading

 

 

 

 

The bottom line

 

Shows your reserve balance

 

 

Or

 

 

How much money is left

 

 

In your account

 

To pay

 

 

Future claims

 

 

 

 

Alright….. take a breath

 

 

 

 

 

To determine your new rate

 

 

 

The State looks at your

 

Reserve balance

 

 

 

 

The State also looks at your

 

 

 

3 year taxable wage base

 

 

And your

 

 

 

5 year taxable wage base

 

 

 

 

 

 

Guess which Taxable Wage Base

 

 

The State picks?

 

 

 

 

 

If you said the higher number…..

 

 

 

 

You would be correct.

 

 

 

 

Well….

 

 

 

Guess what?

 

 

 

 

 

New Jersey will not be mailing out the

 

 

New Jersey Employer Contribution Reports

 

 

 

Any longer

 

 

 

 

You will now have to go online…

 

 

 

 

Set up an account…

 

 

 

And look up the information…..

 

 

 

 

Yourself

 

 

 

 

Did I miss that memo?

 

 

 

 

Did you miss that memo?

 

 

 

 

 

 

I bet you did not know that

 

 

 

 

Unemployment is the 2nd highest

 

 

Employer mandated tax by the government

 

 

 

 

It is the only tax

 

That you are able to manage

 

 

 

 

You do have the ability to manage

 

 

What rate your company is assigned

 

 

 

 

And

 

 

 

What dollar amount will be

 

Paid into the account

 

For the next 12 months

 

 

 

 

 

 

 

Did you know

 

 

That the national average

 

 

For the overpayment of an

 

Unemployment claim is

 

 

 

Over 10%

 

 

 

 

That means the State may be paying

 

The wrong amount for an unemployment claim

 

 

 

And the money is

 

Coming out of your account

 

 

 

How do you even know your

 

Unemployment Rate

 

Is correct?

 

 

 

How do you know if your

 

 

Reserve balance

 

Is correct?

 

 

 

 

This is one of the services

 

HBS provides

 

 

 

 

We serve as a public advocate for

 

Our clients

 

 

 

 

We hold the state responsible

 

 

 

 

We verify the assigned rate

 

Is correct

 

 

 

 

We manage the payment of claims coming

 

Out of your account

 

 

 

 

Auditing each claim payment

 

 

Verifying it is the correct amount

 

 

 

 

For companies with over 100 employees

 

 

The cost savings to

 

 

 

Manage your unemployment account

 

 

Can be seen within the first year

 

 

 

 

With the unemployment fund depleted

 

 

Now more than ever

 

 

Companies should be taking steps to

 

 

Manage their unemployment accounts

 

 

 

 

 

 

To learn more contact george@hbsadvantage.com

 

 

Visit us on the web www.hutchinsonbusinesssolutions.com

Advertisements

by Jesse Eisinger ProPublica,  Nov. 30, 2011, 12:12 p.m.

Note: The Trade is not subject to our Creative Commons license.

Last week, I had a conversation with a man who runs his own trading firm. In the process of fuming about competition from Goldman Sachs, he said with resignation and exasperation: “The fact that they were bailed out and can borrow for free — It’s pretty sickening.”

Though the sentiment is commonplace these days, I later found myself thinking about his outrage. Here was someone who is in the thick of the business, trading every day, and he is being sickened by the inequities and corruption on Wall Street and utterly persuaded that nothing had changed in the years since the financial crisis of 2008.

Then I realized something odd: I have conversations like this as a matter of routine. I can’t go a week without speaking to a hedge fund manager or analyst or even a banker who registers somewhere on the Wall Street Derangement Scale.

That should be a great relief: Some of them are just like us! Just because you are deranged doesn’t mean you are irrational, after all. Wall Street is already occupied — from within.

The insiders have a critique similar to that of the outsiders. The financial industry has strayed far from being an intermediary between companies that want to raise capital so they can sell people things they want. Instead, it is a machine to enrich itself, fleecing customers and exacerbating inequality. When it goes off the rails, it impoverishes the rest of us. When the crises come, as they inevitably do, banks hold the economy hostage, warning that they will shoot us in the head if we don’t bail them out.

And I won’t pretend this is a widespread view in finance — or even a large minority. You don’t hear this from the executives running the big Wall Street firms; you don’t hear it from the average trader or investment banker. From them, we get self-pity. For every one of the secret Occupy Wall Street sympathizers, there are probably 15 others like Kenneth G. Langone, who, like downtrodden people before him, is trying to reclaim and embrace a pejorative [1], “fat cat.”

The critics are more often found on the periphery, running hedge funds or working at independent research shops. They are retired, either voluntarily or not. They are low-level executives who haven’t made scrambling up the corporate hierarchy their sole ambition in life. Perhaps their independent status removes the intellectual handcuffs that come with ungodly bonuses. Or perhaps they are able to see Big Money’s flaws because they have to compete with the bigger banks for dollars.

Are these “Wall Streeters”? To civilians, they work on the Street. Bankers at the bulge-bracket firms wouldn’t think they are. But that doesn’t mean they don’t count. They know the financial business intimately.

Sadly, almost none of these closeted occupier-sympathizers go public. But Mike Mayo, a bank analyst with the brokerage firm CLSA, which is majority owned by the French bank Crédit Agricole, has done just that. In his book “Exile on Wall Street [2]” (Wiley), Mr. Mayo offers an unvarnished account of the punishments he experienced after denouncing bank excesses. Talking to him, it’s hard to tell you aren’t interviewing Michael Moore.

Mr. Mayo is particularly outraged over compensation for bank executives. Excessive compensation “sends a signal that you take what you get and take it however you can,” he told me. “That sends another signal to outsiders that the system is rigged. I truly wish the protestors didn’t have a leg to stand on, but the unfortunate truth is that they do.”

I asked Richard Kramer, who used to work as a technology analyst at Goldman Sachs until he got fed up with how it did business and now runs his own firm, Arete Research, what was going wrong. He sees it as part of the business model.

“There have been repeated fines and malfeasance at literally all the investment banks, but it doesn’t seem to affect their behavior much,” he said. “So I have to conclude it is part of strategy as simple cost/benefit analysis, that fines and legal costs are a small price to pay for the profits.”

Last week, in a Bloomberg Television event, both Laurence D. Fink, the chairman and chief executive of the mega-money management firm BlackRock, and Bill Gross, the legendary bond investor, evinced some sympathy for the Occupy Wall Street movement [3].

Over the last several decades, “money and finance have dominated at the expense of labor and Main Street, and so how can one not sympathize with their predicament?” Mr. Gross said, speaking of the 99 percent. “To not have sympathy with Main Street as opposed to Wall Street is to have blinders.”

It’s progress that these sentiments now come regularly from people who work in finance. This is an unheralded triumph of the Occupy Wall Street movement. It’s also an opportunity, to reach out to make common cause with native informants.

It’s also a failure. One notable absence in this crisis and its aftermath was a great statesman from the financial industry who would publicly embrace reform that mattered. Instead, mere months after the trillions had flowed from taxpayers and the Federal Reserve, they were back defending their prerogatives and fighting any regulations or changes to their business.

Perhaps a major reason why so few in this secret confederacy speak out is that they are as flummoxed about practical solutions as the rest of us. They don’t know where to begin.

Over the next year, maybe that will change. Things are going to be tough on Wall Street. Bonuses will be down. Layoffs are coming. Europe seems on the brink of another financial crisis. Maybe from that wreckage, a leader will emerge.

as reported in HuffingtonPost 11/30/2011

WASHINGTON — For the second year in a row, Congress must decide during the holiday season whether to renew federal jobless benefits for people out of work six months or longer. While Democrats have been making a huge fuss, with a press conference Wednesday featuring hundreds of unemployed workers, Republicans have been relatively quiet — but that doesn’t mean they’re against reauthorizing the benefits.

Republican leaders in both Houses of Congress have expressed support for continuing the benefits, saying the holdup is just a matter of how the legislation is put together.

“We’re going to be discussing between the House and Senate ways to deal with both continuation of the payroll tax reduction and unemployment insurance extension before the end of the year,” Sen. Mitch McConnell (R-Ky.) said Tuesday. “And in the end, it will have to be worked out in a joint negotiation between a Democratic Senate and a Republican House.”

If the benefits are not reauthorized, 1.8 million jobless will stop receiving checks over the course of January, according to worker advocacy group the National Employment Law Project. The federal benefits kick in for laid off workers who use up to six months of state-funded compensation without finding work. Congress routinely provides extensions during recessions and hasn’t dropped extended benefits with the national unemployment rate above 7.2 percent.

Yet the need to reauthorize benefits has been overshadowed by the looming expiration of a payroll tax cut put in place last December, which would result in a tax hike on every working American — an average hike of $1,000 — a scenario Republicans would like to avoid. And Congress also needs to pass a so-called “doc fix” by the end of the year to prevent a 27 percent cut in pay for doctors who see Medicare patients.

“Nobody is coming out with any definitive statements on [unemployment insurance]. Last year they were happy to,” Judy Conti, a lobbyist for NELP, told HuffPost. “I think it’s indicative of the fact that on a bipartisan basis people understand that workers families and the economy need these programs to continue.”

HuffPost readers: Worried your benefits will stop because of Congress? Tell us about it — email arthur@huffingtonpost.com. Please include your phone number if you’re willing to do an interview.

// // The sticking point over renewing the benefits through next year will be their roughly $50 billion cost. Republicans typically insist that the aid must be “paid for,” but that calculation may not apply if the benefits can be attached to something attractive like a tax cut. Republicans blocked renewed unemployment aid last year until President Obama agreed to extend the Bush-era tax cuts for two more years — at a cost much greater than unemployment. Earlier this year President Obama pressed Congress to pass a jobs package that included many items Republicans favored — for instance a “Bridge to Work” training program — but so far congressional Democrats have not signaled support for those programs.

Many members of Congress expected the deficit reduction super committee to craft a deal that included the benefits, but the committee turned out to be less super than advertised.

“Any kind of grand deal that we’ve been after has eluded us,” House Speaker John Boehner (R-Ohio) said Tuesday, referring to the failed broader talks on the budget and debt. “So let’s try and work incrementally towards a conclusion this session that can benefit all Americans. Because we Republicans do care about people that out — that are out of work. We don’t want to raise taxes on anybody. We want to provide the help to the physicians and the providers in the health care arena in this country, and we want to make sure this country has a sound national defense policy.”

Even Sen. Orrin Hatch (R-Utah), who suggested during a standoff on jobless benefits last summer that unemployed people blow the money on drugs, sounded sympathetic to jobseekers on Wednesday.

“Nobody really has a real quick answer. We’re studying it, looking at it. We’re clearly going to have to do something — nobody wants to see people suffer,” Hatch told reporters outside the Senate floor on Tuesday. “There’s a huge underemployment rate as you know, of 16, 18 percent, somewhere in that area. People don’t even want to look for jobs anymore. There oughta be some incentives to find jobs, to get to work. It’s easier said than done. I think there’s a general consensus that we need to help people.”

What’s Going On

November 3, 2011

What’s going on?

 

That seems to be the big question…..

 

Everyone is asking

 

 

Marvin Gaye sang about it back in the 70’s

 

Yet we still are asking the same questions, today….

 

 

The economy almost collapsed

 

People started looking at….

 

How the government reacted…

 

 

Why did they not see it coming?

 

 

The stimulus failed…

 

 

And the people started saying…..

 

 

No More …….

 

 

The Teaparty came from a grass roots effort

 

And have grown to be a voice

 

 

They have endorsed……

 

Reducing government spending

 

Opposition to taxation in varying degress

 

Reduction of the national debt…

 

And the reduction of the Federal Budget Deficit

 

 

Their message resonated during the 2010 elections

 

As a result we saw a total shake up in Congress

 

 

Did we get any results???

 

 

The result was total gridlock!!!!!

 

 

I do not think that is what the Teaparty had in mind…

 

 

Closing down the government….

 

 

That will not resolve anything

 

 

 

Agreed…… the Government has grown too big

 

Agreed…… the Government must be held more accountable

 

 

The stimulus was needed…

 

 

But it was mismanaged

 

There was no accountability

 

It should not have been

 

 

Carte Blanche

 

 

 

All these events leading to the collapse

 

Did not happened overnight

 

 

We put faith in our elected officials

 

 

We too, turned a blind eye

 

 

Borrowing against inflated housing values

 

 

Margining accounts

 

We all allowed this to happen

 

 

We all drank the Kool-Aid

 

 

And must take responsibility

 

 

 

Now the voices are growing

 

We are the 99%

 

 

What started in New York City

 

Has grown not only throughout the US

 

But has seen its’ presence grow around the world

 

 

There is just not 1 message

 

 

They are saying enough is enough…

 

 

 

What happened to the American Dream?

 

The land of opportunity got up and went

 

 

Overseas….

 

 

 

They are calling for the end of corporate greed

 

 

Corruption and influence over Government

 

 

No more too big to fail

 

 

Where are the jobs

 

 

 

 

How long will this go on?

 

 

Is anybody listening?

 

 

 

I do not believe anybody is protesting

 

Against the successes of the few

 

 

In the past there was an unwritten law…

 

 

Let’s make this a win / win

 

 

The more you help us to become successful

 

We will work

 

To share those successes with you

 

 

That is how the American Dream grew

 

 

Each generation working to improve

 

The Quality of life

 

For the next generation

 

 

The United States was a beacon

 

Everybody wanted to come to America

 

 

 

 

We took our eye off the ball

 

After 911,

 

 

America was united

 

Patriotism was at an all-time high

 

 

Then we got involved in several wars

 

 

Without figuring out how to pay for them

 

 

There was no shared sacrifice

 

 

President Bush told everyone to go out and shop

 

 

The deficits started rising….

 

 

It took over 200 years to get to a $1 trillion dollars
deficit

 

 

Yet in less than 30years

 

It has ballooned to just under

 

$15 trillion dollars

 

 

 

There are hard and difficult decisions to be made

 

 

Not everyone is going to be happy

 

 

But are we all prepared to start sacrificing?

 

 

Are we going to commit ourselves to a worthy goal?

 

 

 

What will be the quality of life we pass on?

 

 

To our Children….

 

 

And our Grandchildren…..

 

 

 

Will we be known as the lost generation?

 

 

How did we ever….

 

 

 

Let it go so far?

 

 

 

We are the people

 

 

We must all take on a shared responsibility

 

 

Do what needs to be done

 

 

To right the ship

 

Steady the course

 

 

Fulfill the promise America

 

Has brought to all generations

 

 

 

Like our forefathers before us

 

 

 

When asked….

 

Is the quality of life we are passing on….

 

Better than that which we have experienced

 

 

Let us stand proud and say

 

 

YES!!!

As reported by Jennifer Bendary from Huffington Post

WASHINGTON — Senate Democratic leaders have settled on which piece of President Barack Obama’s jobs plan they want to move on first: $35 billion for state and local governments to rehire teachers, police and firefighters.

“Our expectation [is] that the first measure will be teachers,” White House Press Secretary Jay Carney said during a Monday press gaggle aboard Air Force One.

“I didn’t want to get ahead of Senator Reid,” Carney said of breaking the news. “We have been in consultation with him, but it’s his prerogative and we’re very pleased that he will be taking it up.”

During a conference call, Senate Majority Leader Harry Reid (D-Nev.) said he plans to unveil the Teachers and First Responders Back to Work Act later Monday and decide “in the next day or two” when to hold a vote on it. He said the bill would keep 400,000 teachers and first responders on the job, and would be paid for by imposing a 5 percent tax on millionaires.

Asked which pieces of Obama’s jobs plan are next in line for Senate votes, Reid demurred. But he said he has already settled on the next four votes on pieces of Obama’s bill and is waiting to meet with the Democratic Caucus on Tuesday before discussing his plan publicly.

“There is no reason we cannot finish the appropriations bills before the end of the week, and have a vote on this jobs bill,” Reid told reporters on the call. “I am happy to keep the Senate in session as long as needed to make sure we get a vote on this jobs bill.”

Reid’s office also sent out a fact sheet that highlights past votes and statements by Republicans in favor of jobs bills similar to the teacher/first responders aid bill. The fact sheet cites a May 2010 press release by Senate Minority Leader Mitch McConnell (R-Ky.) saying he was “proud” to help secure funds for first responders. It also points to a March 2007 vote to fully fund the COPS program; it included the support of 16 GOP senators.

//

//

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During a speech earlier Monday in Fletcher, N.C., Obama knocked Senate Republicans for voting down his entire $447 billion jobs package last week. All Republicans opposed a procedural vote to begin debate on the bill, along with two Democrats. Obama said his push to break out pieces of his bill and hold individual votes on them gives Republicans “another chance” to act on jobs.

“Maybe they just couldn’t understand the whole thing all at once,” Obama said, drawing laughs from the crowd of supporters. “So we’re going to break it up into bite-sized pieces so they can take a thoughtful approach to this legislation.”

“So this week, I’m going to ask members of Congress to vote on one component of the plan, which is whether we should put hundreds of thousands of teachers back in the classroom and cops back on the street and firefighters back to work.”

Of course, the reality is that Republicans are poised to vote against any piece of Obama’s plan because they don’t like how it is paid for: by raising taxes on millionaires and ending subsidies for the oil and gas industry. But with the 2012 elections in mind, Obama and Democratic leaders plan to keep lining up votes anyway to build the case that Republicans are voting against jobs and the economy in the name of protecting corporate interests.

This story has been updated with information on Senate Majority Leader Harry Reid’s conference call Monday.

As reported in Huffington Post

WASHINGTON — The long-term unemployed have been left out of a deal between congressional negotiators and the White House to enact massive spending cuts and raise the nation’s debt ceiling before its borrowing limit is reached on Tuesday.

Under the so-called grand bargain President Obama tried to strike with House Speaker John Boehner (R-Ohio), federal unemployment benefits would have been extended beyond January 2012, when they are set to expire.

But those negotiations collapsed in July. On Sunday, congressional leaders and the administration crafted a not-so-grand bargain that will cut spending without raising taxes or preserving stimulus programs like federal unemployment insurance.

Asked Sunday night why spending to help the unemployed had been left out of the deal, a White House official said, “because it had to be part of a bigger deal to be part of this.”

In other words, Democrats need significant leverage to get Republicans to agree to additional spending on the unemployed. Federal unemployment insurance programs, which kick in for laid off workers who use up 26 weeks of state benefits, cost a lot of money: Keeping the programs through this year required an estimated $56 billion. In December, Democrats only managed to keep the programs alive for another 13 months by attaching them to a two-year reauthorization of tax cuts.

Anyone laid off after July 1 is ineligible for extra weeks of benefits under current law. People who started filing claims in July who exhaust their six months of state benefits in January will be on their own. (People who are in the middle of a “tier” of federal benefits will probably be able to receive the remaining weeks in their tier, but they will definitely be ineligible for the next level up.) Since 2008, layoff victims could receive as many as 73 additional weeks of benefits, depending on what state they lived in.

Nearly 4 million people currently claim benefits under the two main federal programs (known as Emergency Unemployment Compensation and Extended Benefits), according to the latest numbers from the Labor Department. Another 3 million are on state benefits.

// // The White House official suggested it would be easier for the administration to preserve a Social Security payroll tax cut enacted as part of the December deal because Republicans would view its expiration as a tax increase. “The payroll tax cut will be extended because if they do not that would be a tax increase on every American, something I’m confident, if you believe Speaker Boehner when he says we will not have tax increases, it will have to be [extended],” the official said.

Asked if the White House would continue to push for a reauthorization of federal unemployment benefits, the official said, “Absolutely, we will absolutely keep pushing for that.”

The unemployment rate is not expected to come down anytime soon, and economic forecasters said earlier versions of the deal currently awaiting action in Congress would significantly slow economic growth because of reduced government spending.

Judy Conti is a lobbyist who deals with Congress and the administration for the National Employment Law Project, a worker advocacy group. She agreed with the official that unemployment benefits would have to be part of a big deal.

“Things like the payroll tax holiday and unemployment insurance are controversial and increasingly partisan issues. In order for those to be resolved so far in advance before their expiration there would have had to have been a very significant deal,” Conti said. “Once the grand bargain died, the chance for any meaningful stimulus died as well.”

Sam Stein contributed reporting.

For Our Own Deficit

May 13, 2011

Well……. we did avoid a government shutdown.

Thanks to some last minute wrangling down and DC,

the US economy lives on…..

limping until the end of September 2011.

All eyes now have turned to the vote on raising the debt ceiling.

Officially, the government states we should pass the debt limit sometime in early to mid-May.

What would happen if the Congress votes not to raise the debt ceiling?

Steps can be taken at that time to start shuffling who and what to pay…..

That should buy us another month.

Reports are that if the debt ceiling is not raised by the beginning of July,

The US will go into default.

What would happen should the US go into default?

  • The United States would default on its bond payments and would see its credit rating fall dramatically
  • Bondholders’ would be unable to receive interest payments
  • Investors would have a difficult time trusting the United States to honor its obligations and demand for long term United States debt would fall.
  • Senior citizen would not receive their Social Security checks
    • loss of these dollars would likely further hurt domestic consumption in the United States and place an undue strain on the budgets of senior citizens
  • A default will lead to increased risks for owning U.S. bonds.
    • Increased risks equal higher rates
    • Business loan borrowers and individuals looking for personal loans would see their borrowing costs rise astronomically
    • home or auto loan rates will be drastically higher, since access to credit would be at a premium

           

That’s just a snap shot of what to expect.

We made it thru the Great Recession.

Many experts feel this would throw the US into another Great Depression.

.

Not much time to dawdle!!!

Several weeks ago….

Standard and Poors, for the first time lowered its long term outlook for the federal government’s fiscal health……

From stable

To negative……..

They warned of serious consequences

If the lawmakers fail to reach a deal to control the massive federal deficit

So when is Congress expected to start tackling this issue?

It is reported they will start meeting on this issue sometime in June.

Congress just passed the 2011 budget!!!!

Heck, we still have 5 months left until the 2011 fiscal year is over.

Yet they will resolve the debt issue in 30 days?

America is a great country

No matter what is said

There is no place better to live

Everyone would love to enjoy

The freedoms we take for granted.

The debt ceiling and the deficit…….

Should not be a political issue

It is not going to go away

What are we doing to provide a secure future for the next generation?

We must carefully look at all the programs

Analyze what works

And put a true dollar value on sustainability

We are at a fork in the road

And the decisions we make

Will determine what path we go down

By

Robert Reich

Why aren’t Americans being told the truth about the economy? We’re heading in the direction of a double dip — but you’d never know it if you listened to the upbeat messages coming out of Wall Street and Washington.

Consumers are 70 percent of the American economy, and consumer confidence is plummeting. It’s weaker today on average than at the lowest point of the Great Recession.

The Reuters/University of Michigan survey shows a 10 point decline in March — the tenth largest drop on record. Part of that drop is attributable to rising fuel and food prices. A separate Conference Board’s index of consumer confidence, just released, shows consumer confidence at a five-month low — and a large part is due to expectations of fewer jobs and lower wages in the months ahead.

Pessimistic consumers buy less. And fewer sales spells economic trouble ahead.

What about the 192,000 jobs added in February? (We’ll know more Friday about how many jobs were added in March.) It’s peanuts compared to what’s needed. Remember, 125,000 new jobs are necessary just to keep up with a growing number of Americans eligible for employment. And the nation has lost so many jobs over the last three years that even at a rate of 200,000 a month we wouldn’t get back to 6 percent unemployment until 2016.

But isn’t the economy growing again — by an estimated 2.5 to 2.9 percent this year? Yes, but that’s even less than peanuts. The deeper the economic hole, the faster the growth needed to get back on track. By this point in the so-called recovery we’d expect growth of 4 to 6 percent.

Consider that back in 1934, when it was emerging from the deepest hole of the Great Depression, the economy grew 7.7 percent. The next year it grew over 8 percent. In 1936 it grew a whopping 14.1 percent.

Add two other ominous signs: Real hourly wages continue to fall, and housing prices continue to drop. Hourly wages are falling because with unemployment so high, most people have no bargaining power and will take whatever they can get. Housing is dropping because of the ever-larger number of homes people have walked away from because they can’t pay their mortgages. But because homes the biggest asset most Americans own, as home prices drop most Americans feel even poorer.

There’s no possibility government will make up for the coming shortfall in consumer spending. To the contrary, government is worsening the situation. State and local governments are slashing their budgets by roughly $110 billion this year. The federal stimulus is ending, and the federal government will end up cutting some $30 billion from this year’s budget.

In other words: Watch out. We may avoid a double dip but the economy is slowing ominously, and the booster rockets are disappearing.

So why aren’t we getting the truth about the economy? For one thing, Wall Street is buoyant — and most financial news you hear comes from the Street. Wall Street profits soared to $426.5 billion last quarter, according to the Commerce Department. (That gain more than offset a drop in the profits of non-financial domestic companies.) Anyone who believes the Dodd-Frank financial reform bill put a stop to the Street’s creativity hasn’t been watching.

To the extent non-financial companies are doing well, they’re making most of their money abroad. Since 1992, for example, G.E.’s offshore profits have risen $92 billion, from $15 billion (which is one reason it pays no U.S. taxes). In fact, the only group that’s optimistic about the future are CEOs of big American companies. The Business Roundtable’s economic outlook index, which surveys 142 CEOs, is now at its highest point since it began in 2002.

Washington, meanwhile, doesn’t want to sound the economic alarm. The White House and most Democrats want Americans to believe the economy is on an upswing.

Republicans, for their part, worry that if they tell it like it is Americans will want government to do more rather than less. They’d rather not talk about jobs and wages, and put the focus instead on deficit reduction (or spread the lie that by reducing the deficit we’ll get more jobs and higher wages).

I’m sorry to have to deliver the bad news, but it’s better you know.

By Lisa Fleisher/Statehouse Bureau

As reported on NJ.com

TRENTON — Gov. Chris Christie Thursday will propose major changes to the state’s broken unemployment system, reducing benefits for workers and limiting tax increases on employers, legislative and administration officials said tonight.

Christie’s proposal, which will need to be passed by the Democrat-controlled Legislature, is aimed at softening a tax hike business groups said was their top concern for the year, while also targeting benefits given to future unemployed workers.

Democratic lawmakers have said they would fight to protect benefits for workers, but they also said increasing taxes employers pay for workers could stunt job growth.

“I am going to have to support some element of what is being put on the table,” said Assembly Speaker Sheila Y. Oliver (D-Essex), who was briefed on the proposal Thursday. But “to have unemployed people, quote, ‘share the burden’ of dealing with our fiscal (problem), it’s like adding insult to injury to devastated New Jerseyans.”

The proposal, which would take effect in July, would reduce tax increases on businesses, institute a one-week waiting period for people receiving benefits, reduce the maximum weekly benefits check by $50 and increase benefit restrictions on people fired for “misconduct,” said Oliver and two senior Christie administration officials, who requested anonymity because they were not authorized to speak before the announcement.

With the state’s jobless rate hovering around 10 percent, the proposal would not affect employees already on unemployment.


Full Star-Ledger coverage of the N.J. budget


Christie’s proposal is a shift from a statement he made just before taking office in January. He had said he wanted to find a way to help employers, but the state would have to “pay the piper on this” and he would not ask for legislation to put off the tax increase.

Those taxes on employers pay most of the cost of providing state benefits to laid-off workers. But politicians in both parties for years used unemployment taxes for other purposes, such as paying for health care for the poor.

A constitutional amendment, which Christie supports, will go on the ballot in November asking voters to force the Legislature to stop raiding accounts such as the New Jersey Unemployment Insurance Trust Fund.

When New Jersey and the country plunged into the deepest recession since the Great Depression, the state quickly ran out of money to pay benefits. That triggered a tax increase lawmakers have tried to soften.

“There’s no bigger issue for the economy, for future economic growth, for this state,” said Arthur Maurice, a vice president with the New Jersey Business and Industry Association. “Unless it’s resolved, there will be greater unemployment and no hope of any jobs recovery in the state.”

Without the proposed changes, the average employer in July would see taxes go up 58 percent — or $390 a year — per employee, according to the administration. The changes would hold that increase, on average, to 17 percent this year, or $130 per employee and further limit the potential for increases through 2013.

New Jersey has borrowed $1.2 billion from the federal government in the past year, and Christie and lawmakers have asked congressional representatives to work to get the loan forgiven.

Under Christie’s changes, future laid-off workers would have to bear some of the pain. The maximum weekly state benefit would be scaled back from $600 to $550, and people would have to wait a week to get a check. That means people who take weeklong furloughs — or temporary, unpaid time off — would not be eligible for benefits for that first week.

Those provisions will likely face the biggest fight.

“It’s something that I would have a very hard time supporting,” said Senate Majority Leader Barbara Buono (D-Middlesex). “I think it’s Draconian.”


Posted by: Mitchell Hirsch on Feb 17, 2011

As reported by Unemployedworkers.org

UPDATE: FEB. 17 – UNEMPLOYMENT INSURANCE SOLVENCY BILL INTRODUCED IN SENATE
Senator Richard Durbin (IL), with Senators Jack Reed (RI) and Sherrod Brown (OH), today introduced the Unemployment Insurance Solvency Act of 2011, which offers immediate tax relief to cash-strapped states and employers, preserves UI benefit levels, and creates strong incentives for states to restore their UI programs to solvency while also rewarding states that have managed their UI trust funds effectively.

In a statement, NELP Executive Director Christine Owens said, “Jobless workers, and we hope employers too, should be grateful for the leadership of Senator Richard Durbin and his colleagues Sherrod Brown and Jack Reed on the issue of unemployment insurance solvency.  Following the President’s FY 2012 budget, the introduction of the Unemployment Insurance Solvency Act sets the stage for a serious conversation on how to make sure that the safety net tens of millions of Americans have counted on during the tough times of the last few years will be financially secure into the future.”

The new bill is similar to the plan outlined by President Obama in his remarks last week, but adds further protections for benefits and additional opportunities and incentives for states to return to solvency in the long run. 

Original Post: Feb. 11

Unemployment insurance is just that — insurance — and it’s financed by premiums paid on workers’ paychecks and deposited into a trust fund.  However, the unemployment insurance (UI) trust funds in many states are not only insolvent, but now face heavy debt burdens due to their increased need for federal borrowing during this prolonged period of high unemployment.  Restoring them to financial health is essential to ensure that unemployment insurance benefits are there for workers when they’re needed, both today and in the future.  The Administration has outlined a significant framework to address the problem, which would provide needed debt and tax relief to states and businesses.

A new plan from the National Employment Law Project (NELP) and the Center on Budget and Policy Priorities (CBPP) would build on that framework, further strengthening the long-term solvency of state UI systems while avoiding benefit cuts and employer tax increases.  Workers need to pay attention to this issue.  The last time UI trust funds got hit this hard, in the 1980s, 44 states cut back benefits for workers.

Many states UI trust funds have been hit in recent years by a double-engine freight train.  First, for years many states have inadequately financed their UI funds, both by keeping their taxable wage base for UI too low relative to inflation-adjusted dollar values, and by taking a dangerous “pay-as-you-go” approach, which failed to build adequate reserves during periods of economic growth.  The graph below shows the substantial erosion in the inflation-adjusted value of the wage base that is subject to the UI taxes that fund state systems.  What does this mean?  It means that the employer of a dishwasher pays the same unemployment premium as the employer of a banker.  It does not take a degree in actuarial science to know that this is not going to work.

Value of UI Taxable Wage Base, Adjusted

And oh yeah, second — well, then came the Great Recession with millions of workers’ jobs being lost and the vastly increased need for unemployment benefits to help sustain unemployed job-seekers and their families.

Now, 30 states have exhausted their UI trust funds and are borrowing from the federal government.

The lead editorial in The New York Times yesterday, titled ‘Relief for States and Businesses’, explained the need for the Obama administration’s approach.  Here are some excerpts:

So many people now receive jobless benefits that 30 states have run out of their unemployment trust funds and are borrowing $42 billion from the federal government. Three of the hardest-hit states — Michigan, Indiana and South Carolina — have borrowed so much that they triggered automatic unemployment tax increases on employers, and the same thing is likely to happen to 20 more states this year.

….

On Tuesday, the Obama administration unveiled a smart proposal to delay those tax increases and provide some relief to both employers and state governments. Congressional Republicans reflexively objected to the idea, which could produce higher taxes in three years, but this plan provides relief that might stimulate hiring now when it is most needed.

….

Under the plan, which is subject to Congressional approval, there would be a two-year moratorium on the increased taxes that employers would otherwise have to pay to support the unemployment insurance system, which could save businesses as much as $7 billion. During those same two years, states would be forgiven from paying the $1.3 billion in interest they owe Washington on the money they have borrowed.

….

In 2014, when the economy will presumably have recovered somewhat, employers will have to make up for the moratorium by paying higher unemployment taxes to the states. Specifically, they will have to pay taxes on the first $15,000 of an employee’s income, instead of the current $7,000. But, even then, unemployment taxes will be at the same level, adjusted for inflation, as they were in 1983, when President Ronald Reagan raised them.

The administration is proposing to cut the federal unemployment tax rate in 2014 so that employers would pay the same amount to Washington as they do now. States, if they choose to do so, could collect more from each employer to repay the federal government and restock their own unemployment trust funds.

….

The full details of the plan’s costs and benefits will be available when President Obama submits his 2012 budget to Congress next week. When he does, both parties should take a close look at the numbers and seize the opportunity to keep this fundamental safety net solvent.

“It is a major step forward for the President’s FY 2012 budget to address the UI trust fund crisis,” said Andrew Stettner, deputy director of the National Employment Law Project and a co-author of the new joint NELP-CBPP policy proposal.  “Our proposal rests on the same core principles — giving employers and states relief now while taking concrete steps to restore the long term solvency of the UI trust fund as the economy recovers.  The plan endorses two key aspects of what the Administration’s proposal reportedly includes — raising the taxable wage base up from the inadequate, outdated level of $7,000 and endorsing a two-year moratorium on federal UI tax increases.”

The NELP-CBPP plan, detailed in a new report, would enable states to restore the solvency of their UI trust funds, avoid significant tax increases on employers during a weak economy, and prevent damaging cuts in UI eligibility and benefits for jobless workers, without increasing the deficit.  The plan also suggests additional debt relief for states and positive incentives for employers, rewards states that have maintained sound financing packages, and builds on existing federal protections of state benefit levels.

In a statement, the groups provide a summary of the plan:

• The federal government would gradually raise the amount of a worker’s wages subject to the federal UI tax (i.e., the FUTA taxable wage base). This would automatically raise the floor for the taxable wage bases in the states which by law cannot be lower than the federal wage base, helping those states rebuild their trust funds. (The federal UI tax rate would fall, however, so that overall federal UI taxes did not go up.)

• The federal government would provide a moratorium, until 2013, on state interest payments on their UI loans.

• The federal government would also postpone, for two years, the FUTA tax increases required to recoup the loan principal in borrowing states.

• The federal government would offer immediate rewards and future incentives for states that currently have and continue to maintain adequate trust fund levels.

• The federal government would excuse a state from repaying part of its loan if the state (a) enters a flexible contractual agreement with the U.S. Labor Department to rebuild its trust fund to an appropriate level over a reasonable number of years, and (b) agrees to maintain UI eligibility, benefit levels, and an appropriate tax rate over the loan-reduction period.

This plan would produce the following benefits:

• Employers would not pay higher federal UI taxes until the beginning of 2014, saving them $5 billion to $7 billion while the economy remains weak and $10 billion to $18 billion over the next five years. Also, employers would pay no additional assessments to cover interest payments in 2011 or 2012, saving them $3.6 billion.

• In addition, partial loan forgiveness that comes from a state’s commitment to build adequate trust funds would save employers about $37 billion by the end of the decade. Counting the interest payments on this principal as well, employers could save as much as $50 billion.

• All or nearly all states would assume a path to permanent solvency.

• Employers in responsible states would receive concrete rewards and a more level playing field between the states.

• Adequate trust funds would stabilize UI tax rates over time, avoiding the roller-coaster tax rates common in many states — very low during healthy economic times, rising rapidly during recessions — that harm businesses and the economy.

• States would maintain current UI benefit and eligibility levels.

• The federal deficit would not rise as a result of these policies.

“States face a tremendously urgent crisis when it comes to their unemployment insurance trust funds,” said Michael Leachman, assistant director of the Center’s State Fiscal Project and co-author of the report. “If federal policymakers address this crisis using our plan, employers could save as much as $50 billion in taxes and states would maintain the critical benefits they provide to people who lose their jobs.”