And Now, the Unemployed

Friday, September 28, 2001; Page A38

HAVING COME to the aid of the airlines, some in Congress now want to provide broader aid to their laid-off employees as well, and perhaps to laid-off workers in the related field of airplane manufacturing. It's a worthy impulse that could do some good but would also add to the raggedness and unfairness of the unemployment insurance system. The question is, why just airline and perhaps airplane manufacturing workers? Why not all the others in the hotel, restaurant, travel industries -- you name it -- who likewise lost their jobs Sept. 11? How do you tell whose job was lost to the attacks and whose disappeared because of the business cycle, and why distinguish?

The fact is that the unemployment compensation system is a mess that was largely ignored during the past 10 years of steady growth and low unemployment -- but no longer. The system is patchy by design; the states set their own eligibility standards and benefit levels. A lot of workers get no help -- only about a third of the unemployed any longer qualify -- and most who do get help receive relatively little; benefits usually replace about 20 percent of lost wages. Part-time workers, many of them women, are particularly ill served by the traditional rules, which basically limit benefits to full-time workers.

Congress should begin to fix the system, now. It is contemplating a stimulus package to revive the economy. It is hard to imagine a better suited proposal than a broadening of unemployment benefits at federal expense. If the idea is to replace lost purchasing power, what better way than replacing more wages of more people who have lost work? You could be sure the money would be promptly spent, and as the economy recovered the level of aid would automatically recede. No long-term revenue loss year in and out, such as a corporate income tax would entail.

The airline bailout wasn't a gift to the companies that needs to be balanced now by aid to their workers. It was an effort to keep in operation a vital part of the national transportation system. One function will be to forestall further layoffs. Congress ought to help laid-off airline workers, but in the context of helping all laid-off workers. They're equally worthy. Much of the aid to airline workers was going to come at the end of their normal unemployment benefits anyway. That's a half-year from now. There's time to get it right.