UNEMPLOYMENT EXPANSION AMOUNTS TO TAX INCREASE ON JOB PROVIDERS

A Democrat plan to increase unemployment benefits would amounts to a de facto tax increase on job providers and makes it harder and more costly to provide benefits to unemployed workers who have earned them.

“Increasing taxes on job providers during a recession is reckless,” said state Rep. Justin Amash of Cascade. “Employers are having a hard enough time hiring workers and paying for health and other benefits as it is, and we shouldn’t burden them with more taxes when many of them are struggling just to keep their doors open.”

Michigan’s unemployment program is funded entirely by employers. To receive the temporary federal dollars to help pay for a permanent expansion of unemployment benefits, Michigan must agree to several new stipulations that will lead to significant tax hikes that many job providers will have a hard time covering, Amash said.

The expansion of the unemployment program would mean millions of dollars in additional costs at a time when the state is already facing a $1.3 billion budget shortfall for this year and a deficit of at least $1.5 billion in 2010.

“Democrats continue to push through budgets and programs that Michigan doesn't have money to pay for them,” said House Republican Leader Kevin Elsenheimer of Kewadin. “Asking Michigan job providers to pay for programs the state can’t afford is outrageous and completely unrealistic.

"Michigan continues to spend more than $5 million a day more than it takes in. I don't know any organization that can spend more than it makes for long. Michigan needs to make dramatic reforms that will bring state spending in line with the economic realities we face.”

House Republicans have suggested hundreds of millions of dollars of cost-saving measures and government reforms but have been blocked by Democrats. Elsenheimer said he worries that raising taxes on Michigan job providers will mean that those employers will have less money to hire workers with, further hurting Michigan’s economy.

“Michigan loses 1,000 jobs for every day the Democrats waste finding ways to spend money we don’t have,” Elsenheimer said. “Michigan needs real leadership and realistic ideas that will lead to economic turnaround. What we don’t need is another job-killing tax hike or expansion of government services we cannot afford.”