vt.Buzz ~ a political blog

Political notes from Free Press staff writers Terri Hallenbeck, Sam Hemingway and Nancy Remsen

6.11.2009

Unemployment blues

A story from ProPublica and NPR's Marketplace looks at state's unemployment funds from a national perspective.

Vermont's fund is headed for a negative balance early next year. Legislators put a Band-Aid on that wound this session and established a study committee to look for a long-term solution. Those looking to defend Vermont's status will indeed find that some states are worse.

As this report points out, most states have found it easy to ignore the issue during good times and that's going to cost us all.

"Fourteen states have already run out of funds to pay unemployment insurance claims and taken out a total of more than $8 billion in federal loans to cover the shortfalls. At least 18 more states are in danger of exhausting their unemployment insurance trust funds.

"States with empty unemployment insurance trust funds have pointed to the severe recession as the cause for their plight, but a closer examination of their trust funds shows underfunding and poor planning as the main culprit. Instead of building up reserves during good years, legislatures in these states yielded to political pressure for high benefits and low taxes. The result: dangerously low trust fund balances."

"Federal loans will ensure that states can keep mailing out benefit checks. But the loans pass costs along to federal taxpayers, including people who live in states where unemployment insurance is sufficiently funded. Nor will they solve the long-term unemployment insurance crisis. Taxpayers in states that have borrowed money will have to foot the bill for tens of millions of dollars in interest charges, which must be paid out of the state's general budget because rules prohibit using unemployment insurance funds.

"At the end of 2007, after years of increasing employment and before the current recession hit, 33 states had less than a year's worth of reserves in their trust funds, even though many experts recommend 18 months' worth. Four states had negative balances in the years before the recession started."

- Terri Hallenbeck

Labels: politics, vermont legislature

posted by vt.Buzz | 10:02 AM |

Comments:

Vermont had over $300 million prior to this unemployment crisis and 100% of it was contributed by employers. Raising the base rate is the only way to recover any shortages and something the legislature should do along with capping the benefits awarded (VT is currently in the top 5 states). Employers aren't the only ones responsible for job loses and having the interest come out of the general fund spreads some of the liability around.
BTW- Obama's stimulus was going to add 8500 jobs in VT and so far I have only heard about a dozen jobs saved- not even created!

# Posted by:

NEK | 10:27 AM, June 11, 2009

Another product of the Bush/Douglas recession.

Jim = Jobs. NOT!!!!

# Posted by:

Anonymous | 10:39 AM, June 11, 2009

So now its Obama's fault - be real - he inherited a fiscal mess - brought on by both sides but mostly the reign of the GOP since 1994.

BTW, Douglas administration testified they knew the UI fund would be in trouble several years ago - but did nothing until this year!

# Posted by:

Anonymous | 10:55 AM, June 11, 2009

Bush spent too much money trying to appease everyone (a huge mistake) but the fact that unemployment was 4 1/2% in 2005 and since the legislature changed to Democrat in 2006, the rate is now 9 1/2%! You decide! There is plenty blame to go around but my point is that it is getting worse under Obama, not better. Just wait until the fallout from the GM/Chrysler fiasco hits the VT economy- Unemployment over 10%??

# Posted by:

NEK | 11:44 AM, June 11, 2009

Obama has always said that we didn't get into this mess overnight and we won't get out of it overnight. He never said that he could fix the economic mess in 5 months.

The stimulus money in Vermont hasn't even been spent yet. That's not Obama's fault. That money is spent on the local level by local governments.

# Posted by:

Anonymous | 12:32 PM, June 11, 2009

I have news for you - the Douglas administration is trying to haord as much of the money as possible for the projects they liek rather than give to teh local gov'ts.

# Posted by:

Anonymous | 1:03 PM, June 11, 2009

Let's hope "remedial spelling" is one of those projects.

# Posted by:

Anonymous | 1:12 PM, June 11, 2009

NEK: Bush had eight years to get us into this mess. You expect Obama to solve it in five months? Get real. This is a serious financial problem and it's not going away any time soon. That's reality.

# Posted by:

Anonymous | 1:37 PM, June 11, 2009

JIM = Jobless

# Posted by:

Anonymous | 3:07 PM, June 11, 2009

The stimulus money hasn't even reached Vermont yet- that is Obama's fault. One of his 16 Czar's must be hoarding the cash!
The fact is, Obama is releasing money to the "swing" states first( certainly not VT) and he is delaying some to prop up this next election cycle- all planned by Emanuel & Axelrod.

# Posted by:

NEK | 3:07 PM, June 11, 2009

Get a life NEK. You say,"I have only heard about a dozen jobs saved- not even created!" As if you know if EVERY job created or saved. Give me a break.

It isn't even July 1st. Can we at least be patient and reserve judgment until the end of the summer.

I'm sure you were hammering liberals for complaining about the wars too quickly.

# Posted by:

Anonymous | 3:22 PM, June 11, 2009

July 1st is when he claims to be adding 650,000 more jobs. Obama is the one who made the statement about adding 2.5 million new jobs by year end - not me.
The only jobs he will be creating- other than more government jobs, is bottling more of his "snake oil"!

# Posted by:

NEK | 3:36 PM, June 11, 2009

Yeah, but no one knew how bad the world economy was thanks to GWB and his foolish policies!

# Posted by:

Anonymous | 4:50 PM, June 11, 2009

How long are you going to blame Bush?? It has been 6 months and we lost 2.5 million jobs- seems to me Obama could stop the bleeding even if he didn't start the problem at least he said he could.
The real question that you asked- NO ONE KNEW HOW BAD OBAMA COULD SCREW UP THE ECONOMY!
As for new jobs created- every VT job created by the Stimulus is a photo op for Leahy/Sanders/welch so how many times have you seen their photo??? NOT OFTEN ENOUGH

# Posted by:

NEK | 5:39 PM, June 11, 2009

NEK asks "How long are you going to blame Bush??"

How about as long at the GOP blamed Bill Clinton! Let's agree to stop blaming Bush/Douglas in about eight years. That seems fair ;)

# Posted by:

Anonymous | 4:55 AM, June 12, 2009

Obama hasn't cured cancer!

This is clear evidence that he's a failure and a fraud.

# Posted by:

Anonymous | 9:16 AM, June 12, 2009

No, but the evidence is clear that the lunatic-fringe likes of nekkie boy remain caseless and clueless.

# Posted by:

Jesus | 9:41 AM, June 12, 2009

So that I don't remain clueless and/or caseless (whatever that is), can you give me one thing that Obama has done to help the Vermont economy?

# Posted by:

NEK | 2:11 PM, June 12, 2009

Waiting.......

# Posted by:

NEK | 3:28 PM, June 12, 2009

The stimulus plan that Obama put into place is funding dozens of local infrastructure projects around the state which will put hundreds of people to work and infuse the Vermont economy with millions of dollars. Furthermore, these investments in infrastructure will be a direct benefit to hundreds of Vermont businesses large and small.

Sewer improvements. Bridge improvements. Road improvements. All are sorely needed. Without them, our businesses will continue to suffer.

That's something that Obama has done for the local economy.

Can you “give” me one thing that Jim Douglas has done to help the Vermont economy?

# Posted by:

Anonymous | 3:33 PM, June 12, 2009

Read your statement.. "will be a direct benefit..."
i.e.- he hasn't done squat yet! You are right that they are needed but at what cost??
Douglas has kept this state from bankruptcy- 1)if the Dem Legislature had their way we would by paying 25% more for electricity and the big employers who use electricity would be closing;2) the property taxes would be higher if we let the education budget increase through proposed programs;3) utilities would be more if we let Efficiency VT have the increase proposed in the Legislature(from 3 1/2% to 7%); our health care cost would be 25% higher if we let Catamount grow the way the legislature proposed;4) we would have increased the state employee #'s with some of the new legislation; 5) we would be paying more for boat fees, canoe/kayak fees if legislation had passed; 5)taxes would have increased if Housing/conservation had their way with the budget...I could add more but so far you have not answered my question- WILL help the economy is NOT what the question was!
Obviously, some elitest residents do not care about taxes and tax rates but us working Vermonters need to control our costs.

# Posted by:

NEK | 6:44 PM, June 12, 2009

i.e. Douglas hasn't done squat. He's created gridlock. He's increased the partisan divide. He's ignored the needs of Vermonters. He's ignored our energy needs.

Funny that we need infrastructure improvements -- you just don't want to pay for it.

# Posted by:

Anonymous | 9:03 PM, June 12, 2009

That stimulus money is putting Vermonters to work right NOW.

Right NOW people are hiring to get these construction jobs underway.

That's a direct and immediate impact on our LOCAL economy.

# Posted by:

Anonymous | 10:35 PM, June 12, 2009

NEK... You clearly are drinking Douglas' koolaid - every year since he was elected Governor, he has proposed and approved increased fees on Vermonters. In fact, when he had the opportunity to have out of staters pay for 30-35% of gas tax, he instead chose having Vermonters pay 100%.

Douglas' approach to education would have increased Vermonters property tax bills - in fact, Act 68 as we know it now is the really the plan of the Gov Douglas and a GOP controlled house in 2003.

Frankly, Jim Douglas lacks vision, leadership and common sense!

# Posted by:

Anonymous | 7:51 AM, June 13, 2009

Jim equals joblessness. Give him two more and he'll have ya homeless, to boot.

Assuming, of course, it takes him that long.

# Posted by:

Jesus | 6:48 PM, June 13, 2009

The legislature did not protect or take care of us Vermonters.

# Posted by:

Anonymous | 8:32 AM, June 15, 2009

The governor did not protect or take care of us Vermonters.

# Posted by:

Anonymous | 1:19 PM, June 15, 2009

JIM = Jobless

# Posted by:

Anonymous | 4:33 PM, June 15, 2009

Jim Douglas has been at the helm for the greatest economic decline in Vt history since the great depression!

# Posted by:

Anonymous | 8:31 AM, June 16, 2009

Jim Douglas lacks vision, leadership and compassion!

# Posted by:

Anonymous | 10:32 AM, June 16, 2009

The last 3 posts direct from Bartlett, Shumlin and Smith- don't you have some taxes to raise or nuclear plants to close?

# Posted by:

NEK | 11:49 AM, June 16, 2009

Actually NEK... more and more people in VT are realizing that Jim Douglas needs to go.

# Posted by:

Anonymous | 2:40 PM, June 16, 2009

Post 11:49 is so right on.

# Posted by:

Anonymous | 4:52 PM, June 17, 2009

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