Michigan, A High Jobless State, Cuts Jobless Benefits

Michigan Gov. Rick Snyder.

Michigan Gov. Rick Snyder. AP hide caption

itoggle caption AP

Few states were hit harder by the Great Recession and unemployment than Michigan, a state that faced profound economic challenges, including relatively high unemployment, even before the national downtown.

So it could strike some as ironic that Michigan, of all places, just enacted into law a reduction of the number of weeks it will pay unemployment insurance to 20 weeks from 26 weeks starting next year.

The reduction will make Michigan the state that provides jobless benefits for the shortest number of weeks. And that's in a state whose jobless rate was 11.3 percent in February compared with the 9.5 percent national rate.

Gov. Rick Snyder, a Republican who took office this year, and GOP legislators said the reduction was necessary because the state's unemployment insurance fund is $4 billion in the hole as a result of its economic woes. Michigan borrowed from the federal government to keep the program afloat.

Since employers contribute to the state's jobless fund and were facing higher taxes to repay the federal loan, they supported the benefits reduction.

Democratic critics, however, are outraged not just because of the size of the benefits reduction but also because they say it was done in a fairly stealthy fashion. As the New York Times reports:

The measure, passed by a Republican-led Legislature, took advocates for the unemployed by surprise: the language cutting benefits next year was slipped quietly into a bill that was originally sold as way to preserve unemployment benefits this year.

The original bill was aimed at reducing unemployment fraud and making a technical change so the state's current long-term unemployed could continue receiving extended unemployment benefits from the federal government for up to 99 weeks — benefits that would have been phased out next week without a change in the state law to make the unemployed in the state eligible to continue receiving benefits. Republican lawmakers amended it to cut the length of benefits starting in January.

Reporters caught up with Gov. Snyder, who signed the legislation into law Monday, after a speech Tuesday morning and he defended the cuts as part of a pivot he was performing to focus his state's government more on job creation than jobless benefits, according to Dawson Bell of the Detroit Free Press.

"Next year, my main issue is, let's start the job creation process. Let's focus on bringing our unemployment rate down so we don't have people on unemployment that's going on for 20-26 weeks or 99 weeks."

This story should be read with another. Politico.com reported recently that efforts by Republican governors to rein in budgets by cutting popular programs has generally come at the cost of their approval ratings.

Almost every governor who's tried to deliver a take-your-medicine message has paid a price. And widespread polling data suggests a chasm between what Americans say they want and the price they're prepared to pay to get there.

Snyder is among that number. The Free Press recently reported that a poll put his approval rating at just 33 percent with half of those surveyed disapproving.

Cutting jobless benefits in a state with a high jobless rate may make fiscal sense, but it certainly won't make him any more popular.

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