Another Toll of Unemployment

The 13 states able to fund jobless benefits without borrowing from the Fed, versus the 33 states (and possible four more) that have borrowed to keep the unemployment check coming in, is basically a modern day iteration of Aesop?EUR??,,????'???s fable of the ?EUR??,,????'??Ant and the Grasshopper.?EUR??,,????'??

For many, being unemployed is in a real sense a struggle for survival. The unemployment check may allow a family to eke out an existence, but the wolf is at the door.

According to a report released April 8, 2010 by the National Employment Law Project, 33 states plus the Virgin Islands have run through their jobless benefit funds, forcing them to borrow more than $38.7 billion to keep their unemployed citizenry afloat. These numbers are unprecedented and four more states are about to join the rolls of unemployment benefits insolvency.

California has borrowed the most ($8.4 billion), followed by Michigan and New York, which have loans worth more than $3 billion. Nine other states have borrowed at least $1 billion from the Fed.

Unemployment funding has been under strain for years. At the onset of the recession, only 19 states met the recommended funding level of one-year?EUR??,,????'???s worth of reserves equal to the highest amount of unemployment insurance paid out during prior recessions. Of the 13 states that will likely be able to fund jobless benefits without borrowing from the Fed, 10 of them followed this recommended financing tactic, the National Employment Law Project concluded in its study.