Senate rejects expanded spending package

Senate Democrats have abandoned efforts to pass a measure that would provide aid to financially weak state governments and extend emergency unemployment benefits for millions of jobless workers, according to The Washington Post. The decision came after the Senate failed again to obtain the 60 votes needed to pass the legislation.

Those who opposed the measure said they were concerned that even the latest version, which had been slimmed down, would add to bloated budget deficits.

President Obama believes the legislation is needed to avoid layoffs of hundreds of thousands of state workers and help support the economic recovery. Although Democrats say they most likely will try again to obtain Republican support for the measure, they most likely will wait until after the July 4 recess.

Emergency unemployment benefits expired June 2, and since then, checks have been cut off for more than 1.2 million people. That number is expected to exceed 2 million people by the time Congress returns from the July 4 recess. If Congress doesn't act, the program, which provides up to 99 weeks of benefits, would be completely phased out by the end of October.

Advocates for extending the benefits say they will continue to fight, believing people shouldn't be abandoned when the national unemployment rate is 9.7 percent.

The latest version of the legislation would have increased budget deficits by $33 billion during the next decade. Obama's request for $24 billion in state aid was reduced to $16 billion, and its cost would have been covered by unspent funds from last year's economic stimulus package. Other provisions, such as plans to extend various expiring tax breaks, would have been paid for completely.

Date : 6/28/2010