Unemployment insurance fund headed for insolvency

[NNN0LHI]

http://www.insidebayarea.com/timesstar/localnews/ci_10705314

By Josh Richman
Oakland Tribune
Article Last Updated: 10/12/2008 10:58:58 PM PDT

Oct. 7

Assembly Labor and Employment Committee Chairman Sandre Swanson, D-Alameda, says lawmakers are going to have to work across the aisle to fix California's unemployment insurance fund, which will be broke by January.

He apparently means lawmakers should be talking about raising the payroll tax that employers pay on each worker to bankroll the state unemployment fund. And for Legislative Republicans presumably still smug about preventing any tax increases in this year's budget fiasco, that's going to be a tall order.

The Assembly Insurance Committee and the Assembly Budget Subcommittee on State Administration held a joint hearing today to examine why we're in this fix and what should be done about it; Swanson issued a statement soon afterward.

"This fund is critical to ensure that workers who have lost their jobs through no fault of their own are able to pay their bills and put food on the table while they look for work," he said. "The current funding crisis threatens the solvency of that fund and we must address it as quickly as possible."

Swanson cited a report showing the state unemployment fund will be $1.6 billion in the red by the end of 2009 and $3.5 billion short a year after that. But the situation might be even more dire: That report assumed a 6.4 percent unemployment rate and a 6.6 percent rate for 2009, but unemployment already had risen to 7.7 percent as of August.

[htuttle]

1. How about a bail out? :)

$3.5 billion dollars is a pittance compared to what the government is lavishing on brokers and investors right now.

[Democrats_win]

2. Sad that it will be fixed on the backs of American workers and not Hedge fund billionaires.

Those dead beats don't pay a cent in tax, take all of the benefits from offshoring American jobs.

[Blue_Tires]

3. ttt