Yesterday the Senate passed a bill to extend unemployment benefits for approximately 2.5 million people who are unemployed and looking for work. This is an important and long overdue measure to help Americans who have been out of work for more than 26 weeks, but the underlying problem remains: there are simply not enough jobs to go around. 

There is no single fix for the floundering job market. But one Recovery Act program, the TANF Emergency Fund, has shown great promise as an effective and efficient method of job creation. To date, the $5 billion Fund has subsidized thousands of jobs for individuals who otherwise likely would have remained unemployed, as well as provided emergency assistance to families in crisis, and it is expected to directly create more than 185,000 jobs in both the public and private sectors before it expires in September. Extending the Fund through FY 2011 with an additional $2.5 billion, as the House voted to do in the extenders bill passed in May, would allow states to continue and expand successful job creation programs.

Touted in a recent CNN piece as “a stimulus program even a Republican can love,” the Emergency Fund has garnered bipartisan support across the country. Haley Barbour, the Governor of Mississippi (and chair of the Republican Governors Association), has said that he hopes the Emergency Fund will be extended, and recently noted that the subsidized jobs program in Mississippi, STEPS, has “seen a huge amount of interest from Mississippi employers who would like to grow their business but are limited during this economic downturn.”

Michael Rounds, Governor of South Dakota, and Chester Culver, Governor of Iowa, cosigned a letter to Congress conveying the support of the National Governors Association for an extension of the Fund. The National Conference of State Legislatures similarly has expressed bipartisan support for the program and petitioned Congress to extend it, “particularly…to allow states to maximize the use of funds for subsidized job programs, which require a longer time to implement and operate.” And Kevin Hassett, Director of Economic Policy Studies at the American Enterprise Institute, has praised the stimulative effect of subsidized job creation and said that “[g]iven the state of the labor market, it is hard to imagine how any sensible person could oppose” extending the Fund for one year. 

Notwithstanding such widespread praise, a number of Members of Congress have resisted attributing job creation to the Recovery Act generally or the Emergency Fund specifically. Senator John Cornyn (R-TX) said that a vote for the extenders package that included the Fund extension would be “a vote for killing jobs,” and he cosponsored Senator John Thune’s (R-SD) amendment that would eliminate the extension—even though Texas expects to create a total of 51,000 jobs from its Fund allotment, which will likely be jeopardized if subsidies are cut off prematurely. 

Senator George LeMieux (R-FL) recently said on Fox Business that the stimulus plan failed to create jobs, especially in the private sector, yet Florida’s Agency for Workforce Innovation estimates that the Emergency Fund will create up to 25,000 jobs (directly and indirectly) in the state by September, with employers that include restaurants, manufacturing companies and nonprofit organizations. In the House, the Fund extension passed despite the objections of a vocal minority led by Tom Price (R-GA), who has mischaracterized the program as one that “incentivizes people not to work”. 

Though there seems to be a broad consensus that job creation is critical to our economic recovery, opinions frequently diverge on the best means to that end. The TANF Emergency Fund is one measure that has managed to win support from both sides of the political aisle outside the Beltway—but the proposal to continue it has stalled in the Senate due to repeated filibusters of the extenders bill. 

If Senators are as concerned with job creation as they claim, they ought to show it by taking up a bill to extend the TANF Emergency Fund and enhanced Medicaid funding through FY 2011. 

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