Cuts shink 'safety net' for jobless Families pay the price for benefits "belt-tightening."

November 07, 1991|By Los Angeles Times

Not long ago, Cynthia and Dewaune Allen seemed to have it made: a house in New Carrollton with three bedrooms for their four children, a BMW in the driveway and a stable, middle-class future ahead of them.

But when the store where Cynthia worked went bankrupt, the Allens quickly discovered that without two incomes, their middle-class status might not long survive. As she struggled through the bureaucratic hassles of obtaining unemployment compensation, Allen anticipated a few weeks, perhaps a month or two, between jobs. Last week, six months later and still out of work, she received her final unemployment check.

Although Dewaune still has his job, without Cynthia's income the family teeters on the edge of economic calamity. Unable to pay the rent, they will soon have to give up their house, they say. The children have already been told not to expect presents this Christmas. With bills continuing to mount, the Allens are looking into their eligibility for food stamps.

"We were in pretty good shape," Allen says. "Then everything went bad."

As President Bush and Congressional Democrats continue to their months-old quarrel over whether and how to extend unemployment benefits, the plight of the Allen family -- and those of millions of others who face even worse situations -- reflect the reality behind the impersonal statistics of a nation in recession. And the current slump marks the first time that the erosion of unemployment coverage has hit home with members of the middle class.

That, in turn, has brought thousands of Americans face to face with an often-overlooked fact about the present condition of the government "safety net" that most had assumed would protect them from disaster: The nation's unemployment insurance system, once a prime bulwark standing between the middle class and poverty, has been severely weakened by a succession of cutbacks and changes in government policies.

During the recession of the mid-1970s, nearly 60 percent of all unemployed people were receiving unemployment checks. This time around, only 38 percent are.

Since March, some 2 million people have run out of unemployment benefits. Roughly 60 percent of those are believed to be still without work.

Overall, as of last month, 2.5 million Americans had been unemployed for 15 weeks or more and 1.1 million had been unemployed for more than 26 weeks. The numbers have almost doubled from the levels that prevailed in 1989, before the recession began.

As all this has happened, Bush and the Congress have been deadlocked.

Last winter, Democratic leaders in Congress began pushing a $5.3 billion proposal to allow the unemployed to collect benefits for 13 extra weeks -- something that has been done in every previous recession since 1958. The proposal would help 3 million people next year, congressional budget officials estimate.

Bush twice vetoed those attempts, arguing that the Democratic plan was too costly and would increase the federal budget deficit.

Now, the White House has begun to bend -- apparently in response to a rising tide of voter anger and frustration over Washington's failure to deal with the economy.

The urge to negotiate became even more intense after Tuesday's election, when former Attorney General Dick Thornburgh lost a bid for a Senate seat from Pennsylvania. Thornburgh's loss is widely seen as a reflection of voters' anger over the administration's stewardship over the economy and voter anger at Washington's seeming inability to help those in need.

Senate Democrats moved yesterday toward trying to freeze foreign aid and using the money saved to pay for extended unemployment benefits for people out of work at least half a year.

The president's budget director criticized the $5.6 billion plan as a violation of last year's budget act.

But Sen. George J. Mitchell of Maine, the majority leader, retorted, "Why is the president so ready, eager and willing to help people overseas and so reluctant to help people in need in America?"

Republicans and House Democratic leaders were wary of the Mitchell approach, but they agreed that it might carry overwhelmingly in both houses, perhaps at veto-proof levels, if allowed to get to the floor.

If the current negotiations over extending jobless benefits lead to a compromise, it will come only after enormous human cost.

Although federal and state governments are now spending some $26 billion on unemployment coverage, the coverage is reaching a smaller percentage of jobless Americans than in any recession in the last generation. More and more are still unemployed after ++ their 26 weeks of benefits have been exhausted, and the benefits are no longer automatically extended.

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