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Policy: Entitlements

In new pitch to pass jobless pay, Harry Reid sweetens deal with measure to restore military pension cuts

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Politics,Congress,Susan Ferrechio,Harry Reid,Entitlements,PennAve,Military Budget,Pensions

The Senate this week will make another attempt to pass an extension of federal unemployment insurance by tying the effort to a plan to restore military pension benefits.

Senate Majority Leader Harry Reid announced a Thursday vote on a bill that would provide federal jobless pay for three months. Two prior votes to pass the extension have been blocked by Republicans because of the cost.

This time, consideration of the bill will be followed as early as next week by a separate vote on legislation to restore recent cuts to the cost-of-living adjustment (COLA) in military pensions, a priority for many lawmakers in both parties but Republicans in particular.

Democratic lawmakers have proposed paying the $6.4 billion price tag of a short-term unemployment-insurance package by extending a program to calculate pension contributions in a manner that yields higher taxes. Democrats, in a nod to Republicans, also added a provision banning anyone who earns more than $1 million from collecting jobless benefits.

“Republicans complained that we had not paid for the extension,” said Reid, whose state of Nevada suffers from a 8.8 percent unemployment rate that is among the highest in the nation. “So, today we are offering an amendment that extends unemployment insurance for three months and pays for that extension — not with a controversial extension.”

The military pension bill is sponsored by Sens. Mark Pryor, D-Ark., and Kay Hagan, D-N.C., two of the party’s most vulnerable lawmakers up for re-election in 2014. The bill stops the planned cuts to COLA for military personnel under age 62, which Republicans will find attractive. But the legislation does not provide an offset for the $6 billion price tag, which could put the GOP in a political corner, owing to its opposition to raising the deficit.

Senators in both parties have proposed several measures to repeal the military pension cuts. Kelly Ayotte, R-N.H., has proposed a bill that would cover the cost -- and provide extra funds for deficit reduction -- by ending a tax loophole that allows illegal immigrants from accessing the Additional Child Tax Credit.

An extension of unemployment benefits failed to pass the Senate last month in part because Republicans wanted the chance to consider more amendments to the bill than Reid would allow.

Reid said Tuesday he would consider amendment proposals from the GOP for the legislation but would not permit unlimited offerings.

“Why are they hung up on this foolishness?” Reid asked about the GOP after introducing the bill.

In a briefing with reporters on Tuesday, Reid called unemployment pay “the best stimulus there is for the economy.”

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