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Statement of Administration Policy: H.R. 5260 - Unemployment Compensation Amendments of 1992

June 04, 1992


(House Rules)
(Rostenkowski (D) IL and Downey (D) NY)

The President remains deeply committed to providing assistance to unemployed Americans. He and other members of the Administration have repeatedly pledged support for extending the Emergency Unemployment Compensation (EUC) program as the economy recovers.

On April 8th, the President called for an extension of the EUC program through the end of 1992 and directed the Secretary of Labor to work with Congress to enact such an extension. On May 12th, the President and the Republican congressional leadership proposed an extension of the EUC program through March 6, 1993. The EUC extension would provide a total of 39 to 46 weeks of unemployment benefits to those who qualify by January 2, 1993, and a total of 33 to 36 weeks of benefits to those who qualify by March 6, 1993. This extension is deficit-neutral year-by-year, using acceptable offsets. The Administration believes this proposal is a responsible and responsive compromise.

H.R. 5260, on the other hand, would increase employers taxes and extend the EUC program in a manner incompatible with long-term economic growth and fiscal responsibility. Increasing taxes on employers would threaten job growth in existing jobs. The bill also would overturn current law enacted a year and a half ago in the Budget Enforcement Act (BEA) by prohibiting all new budget authority, outlays, or receipts resulting from the bill from being considered for any purposes of the BEA. This waiver is an attempt to avoid budget discipline and would increase the current deficit and only promise to reduce deficits in future years.

If the waiver provision were deleted, the Administration would still oppose the bill because it would fail to meet BEA pay-as- you-go requirements. Without the BEA waiver, the bill would result in a sequester of Medicare, farm payments, and other sequestrable mandatory programs. In addition, H.R. 5260 is objectionable because it would exempt EUC benefits from sequestration.

If H.R. 5260 were presented to the President in its current form, his senior advisers would recommend a veto.

H.R. 5260 also would make permanent structural changes to the current unemployment compensation system. The Emergency Unemployment Compensation Act of 1991 (P.L. 102-164) established the Federal Advisory Council on Unemployment Compensation to study the current system and make recommendations on permanent changes by February 1, 1994. The President and Republican leadership proposed to accelerate the timetable for the council enabling it to recommend changes by February 1, 1993. Congress should not undertake fundamental program changes before its own advisory council can rationally consider long-term reform.

The Administration is supportive of Representative Archer's efforts to combine extension of the EUC Program, with provisions that would stimulate investment and create jobs. The U.I. benefit structure in the Archer amendment is identical to that in the Republican Leadership package which the Administration has endorsed as the appropriate response to the Nation's unemployment problem.

Pay-As-You-Go Scoring

Absent the waiver provision described above, H.R. 5260 would be subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act of 1990 (OBRA). The revenue provisions in the bill do not fully offset the increased direct spending on a year- by-year basis. A budget point of order applies in both the House and Senate against any bill that is not fully offset under scoring by the Congressional Budget Office. If, contrary to the Administration's recommendation, the House waives any such point of order that applies against H.R. 5260, enactment of this legislation would be included in a look back pay-as-you-go sequester report at the end of the congressional session.

OMB's preliminary scoring estimates for this bill are presented in the table below. Final scoring of this legislation may deviate from this estimate. If H.R. 5260 were enacted, final OMB scoring estimates would be published five days after enactment as required by OBRA. The cumulative effects of all enacted legislation on direct spending will be issued in monthly reports transmitted to Congress.

Estimates for Pay-As-You-Go
($ in millions)

  1992 1993 1994 1995 1996 1997 1992-1997
Outlays 781 3,565 507 368 196 148 5,565
Receipts 122 938 680 677 2,065 4,001 8,483
Net Deficit Increase (+)/
Decrease (-)
659 2,627 -173 -309 -1,869 -3,853 -2,918

George Bush, Statement of Administration Policy: H.R. 5260 - Unemployment Compensation Amendments of 1992 Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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