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CPPP: Texas Lawmakers Should Seize Opportunity to Fix Unemployment Insurance

The Center for Public Policy Priorities today urged state policymakers to draw down available funds for unemployment insurance (UI) benefits in the federal recovery law. The center highlighted an exchange yesterday between Federal Reserve Chairman Ben Bernanke and U.S. Senator Jack Reed (D-RI) regarding the counterproductive effects of states forgoing money for UI:

BERNANKE: If unemployment benefits are not distributed to the unemployed, then they won't spend them and it won't have that particular element of stimulus.

SEN. JACK REED (D-RI): So if this was done on a wide basis, it would be counterproductive, not productive?

BERNANKE: It would reduce the stimulus effect of the package, yes.