Jobless Aid Cutoff May Hurt Economy

Summary


WASHINGTON - If Congress lets unemployment benefits expire this week for the long-term unemployed, they won't be the only ones to feel the pain. The overall economy would suffer, too.

Unemployment benefits help drive the economy because the jobless tend to spend every dollar they get, pumping cash into businesses. A cut-off of aid for millions of people unemployed for more than six months could squeeze a fragile economy, analysts say. Among the consequences they envision over the next year:

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Jobless Aid Cutoff May Hurt Economy

* Annual economic growth could fall by one-half to nearly 1 percentage point.

* Up to 1 million more people could lose their jobs.

* Hundreds of thousands would fall into poverty.

"Look for homelessness to rise and food lines to get longer as we approach Christmas...

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