Senate to pass jobless aid, business tax breaks

[March 10, 2010]  WASHINGTON (AP) -- Legislation blending help for the jobless with popular tax breaks for businesses and individuals is slated to pass the Senate Wednesday over protests from conservatives who say it adds too much to the $12.5 trillion national debt.

But compassion for the jobless and the political power of an annual package of tax breaks is likely to produce a bipartisan vote to pass the measure, even though it would add more than $130 billion to the budget deficit over the next year and a half.

The bill would provide unemployment benefits of up to 99 months in many states for people mired in joblessness as the economy slowly recovers from the worst recession in decades. The measure easily cleared a procedural hurdle Tuesday by a 66-34 vote, with eight Republicans voting with Democrats to break a GOP filibuster.

The measure illustrates the great extent to which direct help for the jobless and the poor makes up a large portion of Democrats' election-year agenda on jobs -- and threatens to squeeze out other items amid concerns about a budget deficit projected at a record $1.6 trillion this year.

The sweeping bill cleans up a host of unfinished congressional business from last year that languished as the Senate focused on health care. It would also prevent doctors from absorbing a 21 percent cut in Medicare payments and extends through December a generous 65 percent subsidy of health insurance premiums for the unemployed under the COBRA program, at a cost of $10 billion.

Democrats also hope to finish work this week on a far smaller job-creation measure blending additional highway spending with new tax breaks for companies that hire the unemployed. The Senate could clear the measure for President Barack Obama's signature by Friday.

Wednesday's larger bill also provides the annual extension of $26 billion worth of tax breaks for businesses and individuals that are popular with senators in both parties.

The $66 billion cost of providing additional months of unemployment checks -- the core benefit is 26 weeks -- is added directly to a budget deficit expected to hit $1.6 trillion this year. Federal cash to help states with Medicaid adds about $25 billion more.

"Even though these programs may be good for your state, a senator has an obligation to stand up and say 'no more,'" said freshman GOP Sen. George Lemieux of Florida. "No more spending our kids' future. No more bankrupting the promise of this country."

But Democrats said it would be heartless to cut off unemployment benefits to the long-term jobless and contended that the benefits inject demand into the economy, helping to lift it.

"This is not just some technical bill," said Sen. Max Baucus, D-Mont. "This bill helps real people. Failure to enact this bill would cause real hardship. Failure to enact this bill would cost jobs."

The tax breaks include a property tax deduction for people who don't itemize, lucrative credits that help businesses finance research and development and a sales tax deduction that mainly helps people in the nine states without income taxes.

[Associated Press; By ANDREW TAYLOR]

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