Heck with the bank bailout, what happens when unemployment funds run out?

Wall Street Journal

A growing number of states are actually running out of cash to pay unemployment benefits or have already emptied their unemployment-Insurance Trust funds.

With the high number of people unemployed, nearly 4.8 million people collecting unemployment-Insurance last week, which is of most since federal officials have been tracking the numbers 40 years ago, states have already begun to borrow millions from the Federal government in order to pay unemployment insurance claims.

States like West Virginia, in order to forestall tax increases said they will push for cuts in unemployment benefits, while others like Kentucky, have automatic triggers in place raising employer contributions when the insurance fund fails.

"You collect money when times are good and pay it out when times are bad, but no one anticipated such bad times," said Diana Hinton Noel, labor analyst for the National Conference of State Legislatures.

The proposed U.S. stimulus package will likely help unemployment benefits [unless Oregon decides to opt out of that one too] with a focus being on extending benefits to long-term unemployed and expanding insurance to jobless part time employees.

here's something I really get a kick out of… We always hear that state and local governments are running short on money, and they seem to feel that the solution to that problem is to simply raise taxes.

Well, the money tree is starting to run a little bare. I mean how smart is this… In times of high unemployment where large corporations are either closing or laying off high numbers of employees due to a recession, let's help the situation by increasing taxes on those corporations.

How about doing the opposite and cutting taxes allowing these companies to retain their employees a little longer, thus putting money back into the system.

DUH!