The Register-Herald, Beckley, West Virginia

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January 8, 2014

Manchin says Senate working on solution for unemployment

While in favor of extension, questions remain on funding

WASHINGTON — The bill to extend unemployment benefits an extra 90 days is moving forward, according to U.S. Sen. Joe Manchin, D-W.Va.

Manchin says the bill scraped through a filibuster by voting for cloture on Tuesday.

A filibuster is when someone reads or talks non-stop until time runs out to vote on a bill. Cloture is a way to stop a filibuster and force everyone to debate the bill. A cloture takes 60 votes to pass. The vote passed 60-37.

“After the debates, we go for passage (of the bill).” Manchin said. “That’s where the process is right now and that will probably take the rest of this week and maybe the first of next week.

“I can tell you right now where the differences are in talking to friends on both sides of the aisle. There is quite a concern of how to pay for it. For a three-month extension I think it’s $6.5 billion ... it’s like $25 billion for the full year.

“First of all, there are some people that believe that maybe it shouldn’t be paid for. It’s hard. You can’t continue to borrow yourself out of debt or spend yourself into prosperity. With that being said, I’m looking for a reasonable pay-for.”

Manchin said he has batted some ideas around with Senate Majority Leader Harry Reid about how to pay for the extension.

“One idea we’ve thrown out, that has even been entertained by the president in his 2014 budget, is dual eligibility,” Manchin said. “When you have a person that is hurt on the job and is receiving disability Social Security also receiving unemployment benefits, if that were eliminated and you were not able to draw off of both, that’s about a $5 billion savings.

“That would help tremendously. That’s a reasonable, responsible position to take. I’m sure the people who receive checks from both might not think that, but I believe most Americans believe that’s reasonable. There are ways we can do it.”

Manchin said fair taxes would help pay for the extension, but getting tax reform would be hard.

“When we talk about doing the big tax reform, ‘carried interest’ is one of those loopholes that protects the wealthiest of the wealthy of this country, mostly in the investment arena or the hedge fund people. They’re able to pay capital gains tax rates, which are low compared to personal income tax rate on their income.

“We think that needs to be changed. I don’t find anyone that thinks that’s fair. There are things we could do. We know that one would be harder to get through. That might have to be part of a bigger package. I don’t know what they’re going to come up with, so we’ll have to wait and see, but I would definitely like to see it get paid for.”

Carried interest is a pay plan that taxes a person for how much their investment makes, not for how much a person gets paid. It would be a little bit like working at a yard sale. No one is paying you, so you only make money on what you sell.

Since these hedge-fund investments can last awhile, they use the capital-gains tax, which has a maximum tax rate of 20 percent. The average person would have to pay about 40 percent income tax on the same income amount.

Manchin said he won’t vote for an extension unless someone comes up with a way to pay for it unless the economy is in the same or better shape than it is now.

“Right now, there’s four tiers of emergency unemployment compensation,” Manchin said. “Tier one, all states qualify for 14 additional weeks. That means for a total of 40. We have a total of 3,721 West Virginians that fall into that category.

“Tier two, this is states with unemployment over 6 percent. It gives 14 more weeks. That means that, if you’ve already used up the 40, you’ve got 14 more weeks, now you’re at 54 weeks. There’s 2,953 West Virginians that fall into that bracket.

Very few West Virginians fall into the last two tiers, Manchin added.

“Tier three are states with unemployment over 7 percent. That gives them nine more weeks. If someone is at 54 weeks right now, and this was calculated when we were over 7 percent, we had 57 West Virginians that fell into this category.

“Tier four are states with unemployment over 9 percent. They get 10 more weeks to get a total of 73 weeks all together. We don’t have any West Virginians in that category.”

The bill would add an extra three months to each of these levels. Manchin says he has heard people say they’re worried about someone abusing the system.

“I hear people saying that just by extending it, you’re not going to get people to go back to work,” he said. “On the other hand, I have an awful lot of people saying, ‘I’m trying in every way, shape and form, I just can’t get a job with what my skill-sets are. If that’s the case, then are we doing enough to help you change your skill-sets. Are we telling people where the jobs are?

“If someone says they just don’t want to go back to work, then they must be implying that there is work for them, they just won’t take it. Are we doing enough to link those two up? That’s where the states have to get involved in the workforce. I’m sure there’s a little bit of that, but we still have to be responsible and continue to kick the can down the road.”

- - -

In a press conference, Manchin also talked about some of feelings and plans for 2014.

“Things don’t change too much from year to year,” he said. “If we don’t come to grips with the finances of this country, then sooner or later, it’s going to be a shame. All we’re doing is finding this to pay for this and doing patch work. Nothing makes sense whatsoever. You can’t build any confidence at all.

Manchin said there are other things everyone is worried about, too.

“We need an energy policy that works and says we’re going to become energy independent — the quicker the better. My main goal is to get out of Afghanistan in 2014. I know you’re hearing an awful lot about Iraq. I’m of the mindset that all the money and all the military might in the world will not change that part of the world. I don’t think they want us there and I’m happy to leave. I’ve been very outspoken about that.

“I think it’s time for us to come back to America and build our infrastructure, strengthen our infrastructure and do the things we need to.  Having a better energy policy will prevent us from having to go around the world and fighting the wars that we’re fighting.”

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