News & Commentary

January 7, 2014

The New York Times reports that efforts by states to modernize their systems for unemployment compensation and other government benefits have “largely backfired in recent months, causing enormous cost overruns and delays.” The Times notes that “a lack of funding in many states and a shortage of information technology specialists in public service jobs routinely lead to higher costs, botched systems and infuriating technical problems that fall hardest on the poor, the jobless and the neediest.”

In terms of federal unemployment insurance, the Los Angeles Times reports that the Senate delayed consideration of a proposal to “extend for an additional three months aid for about 1.3 million out-of-work Americans whose long-term benefits expired Dec. 28.” The measure, strongly supported by Democrats, does not appear to have sufficient support among Republicans to overcome a filibuster.

In Detroit, the New York Times reports that the city’s emergency manager, Kevyn D. Orr, “ordered that pension benefits for thousands of public employees be frozen” in an unpublicized action last week, but, after news accounts reported it, “delay[ed] the move to allow for a possible compromise in federally mediated talks.” The order “froze benefits for . . . employees and retirees, eliminated cost-of-living increases, and created a 401(k)-style retirement plan for all new city workers.”

The New York Times also reports on a new study that suggests that high unemployment among young people “is adding up to $25 billion a year in uncollected taxes and, to a much smaller degree, increas[ing] safety net expenditures.” The Times notes that this comes in addition to the long-term costs that unemployed or underemployed young people will experience over the course of their career as a result of the slow start to their working lives. Currently, 15 “percent of workers ages 16 to 24 are unemployed, compared with 7.3 percent of all workers.”

In the Los Angeles Times, Hedrick Smith, former Washington bureau chief of the New York Times, argues that the “stingy” agreement Boeing reached with the International Machinists Union is an ominous and “vivid example of how America’s new economy has created gaping economic inequalities and steadily squeezed the economic life out of the U.S. middle class over the last three decades, even as corporate profits and CEO pay have skyrocketed.” Alec MacGillis previously made a similar argument in the New Republic.

Finally, in Politico MagazineCraig Becker, general counsel to the AFL-CIO and former member of the NLRB, argues that a recent Fifth Circuit decision may be “the most important workers’ rights opinions in decades.” Becker argues that the case could severely curtail employment class actions because it “permits employers to require workers, as a condition of keeping their jobs, to agree to arbitrate all workplace disputes and to do so as individuals, standing alone against their employer.”


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