Feds to states: Don’t privatize food stamps, By Corrie MacLaggan, December 1, 2009, Austin American-Statesman: “Six years after Texas embarked on an ambitious social services outsourcing project that hit major problems, the federal agency in charge of food stamps is warning states against such efforts. ‘These projects encountered severe problems in meeting critical performance standards and many eligible (food stamp) applicants have suffered as a result,’ says a Nov. 20 letter from the U.S. Department of Agriculture to the states. ‘We do not support furtherance of such projects, and believe that they put public funds and our clientele at risk.’ The warning comes as the food stamp program is experiencing a recession-related surge across the country – and as Texas is negotiating a new contract with a private company that is already handling some aspects of enrollment. State officials said they don’t expect the contract to be affected. The message from federal officials to the states: We know these are tough times, but privatization isn’t the answer…”
Day: December 1, 2009
Safety Net for the Long-term Unemployed
New $100 billion safety net for jobless in works, By Andrew Taylor (AP), December 1, 2009, Washington Post: “As unemployment spikes, the cost of compassion is going up too. By as much as $100 billion. That’s the potential price of a push by Democrats in Congress to continue providing extra help to the jobless beyond the core 26-week unemployment insurance package provided under permanent law. The jaw-dropping numbers combine the approximately $85 billion cost of continuing emergency benefits through 2010 for the long-term unemployed – jobless more than six months – plus an estimated $15 billion to continue subsidies to help pay health insurance premiumsEven before the last new round of extended benefits in November, the cost of unemployment compensation was estimated by the White House to exceed $140 billion for fiscal 2010, which began in October. Just two years ago – when the unemployment rate was 4.8 percent in contrast to the current 10.2 percent – the cost of unemployment benefits was only $43 billion…”
State Unemployment Insurance Funds
- N.C. borrowing billions for jobless, By David Ranii, December 1, 2009, News and Observer: “North Carolina’s high unemployment rate has stuck the state with $1.4 billion in debt – money that officials don’t know how they’ll pay back. It gets worse. The debt is still rising. The problem is that with about one-half million people out of work, the state has more unemployment claims than it can pay. So it has been borrowing from the federal government since February, sometimes as much as $20 million a day. The tally will rise to at least $2 billion by the end of the year, said David Clegg, deputy chairman and chief operating officer of the N.C. Employment Security Commission. Next year, depending on the economy, could add another $2 billion to the tab, he said. For purposes of comparison, the state budget for the current fiscal year is $19 billion…”
- State’s unemployment insurance fund runs out of cash, By Matthew Sturdevant, December 1, 2009, Hartford Courant: “The state’s unemployment insurance fund became insolvent on Oct. 13, and Connecticut expects to borrow $900 million from the federal government to keep paying checks to a growing number of out-of-work residents. The unemployment trust fund is funded by a two-part tax on employers that is on track to bring in $630 million to $650 million in revenue this year – far short of the $1.3 billion the state expects to pay out in unemployment benefits, said Carl Guzzardi, tax director for the state Department of Labor…”