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Stimulus Plan Falls Short in Female-Friendly Audit

Sunday, February 3, 2008

Congressional efforts to stimulate a faltering economy are fine as far as they go, but increases to jobless benefits and food stamp aid would have provided more benefit to women, advocates say.

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Congressional efforts to stimulate a faltering economy are fine as far as they go, but increases to jobless benefits and food stamp aid would have provided more benefit to women, advocates say.
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Women's needs may be overlooked in economic plan.

WASHINGTON (WOMENSENEWS)--To rev up the female portion of the economy, advocates say Congress should take a closer look at jobless benefits and food stamps.

"So many are feeling the pinch of this economic slowdown, but because of their particular vulnerabilities, women are being hit especially hard," said Nancy Duff Campbell, co-president of the National Women's Law Center, an advocacy group in Washington, D.C. Enhancing eligibility for unemployment insurance and providing more food stamp money is a fair and quick way to put money back into the economy, she said.

Amid a declining job market, the collapse of the housing market, and the subprime mortgage crisis, the House of Representatives approved a $146 billion emergency stimulus package last week to help stave off recession. On Thursday, the Senate voted 81 to 16 to approve the stimulus plan, increasing the package to $161 billion to allow additional rebates to some Social Security recipients and veterans with disabilities.

The measure came on the heels of primary elections on Super Tuesday. Republican Sen. John McCain of Arizona voted to approve the measure, but neither of the two Democratic candidates, Sen. Hillary Clinton of New York and Sen. Barack Obama of Illinois, participated in the voting.

Although unemployment affects men and women equally, 37 percent of unemployed men receive unemployment benefits versus 33 percent of women, according to the U.S. Department of Labor.

The discrepancy is due to anachronistic eligibility rules written for a Depression-era labor market dominated by men, said Heidi Hartmann, president of the Institute for Women's Policy Research, a think tank in Washington, D.C., that focuses on the economy. At the time, unemployment benefits were mainly designed as a safety net for those who worked full time, met a certain income threshold and lost their jobs solely because of an employer's decision.

Fewer women than men meet these criteria because they are more likely to hold lower-wage jobs, and therefore less likely to meet the system's earnings thresholds. Women are also more likely to work part-time, making them ineligible for unemployment benefits. And they are more likely to leave their jobs to take care of their families, because of domestic violence, harassment or stalking, or to follow a spouse.

"While job loss in these situations is described as a 'voluntary' quit, in a very real sense it is not voluntary; it is a worker's only option," Vicky Lovell, an employment expert at the Institute for Women's Policy Research, wrote in the report.


$7 Billion Overhaul on the Table

Rep. Jim McDermott, a Democrat from Washington state who chairs the Income Security and Family Support Subcommittee on the House Ways and Means Committee, has pressed congressional leaders to consider a $7 billion bill to encourage states to overhaul the system so more women and other workers could get benefits.

Nancy Duff Campbell

McDermott introduced the bill last May, held a hearing on it last September and urged action on it in a speech on the House floor on Jan. 29, the same day that the economic stimulus package passed the House.

McDermott and others criticized the bill because it does not expand eligibility for employment benefits. Insisting that the package was unfinished, McDermott said: "Two-thirds of the people who lose their jobs cannot get unemployment benefits."

The House bill would combine corporate tax incentives with rebate checks for most workers of up to $600 for individuals and $1,200 for couples, plus $300 per child, with caps on individuals earning more than $75,000 and couples earning twice that. Workers earning at least $3,000 would get a smaller benefit. Undocumented immigrants were barred from receiving the rebates in the final version approved by Congress.

Senate Democrats hoped to pass a more expansive version that would have extended unemployment insurance benefits by 13 weeks and would have sent checks to poor, elderly Americans and disabled veterans, groups that would not have gotten rebate checks under the House plan. In the end, they prevailed, despite attempts by Senate Republicans to block the higher price tag.


Extending Benefits to Pump Economy

Senate Democrats also intend to make other changes with amendments including an extension of unemployment benefits and more money for food stamps.

Many Republicans--including President Bush--oppose those amendments, which they say would lard up the package with expensive add-ons that could tangle up the bill in debate between the parties and chambers.

"The temptation will be to load up the bill," Bush said in his Jan. 28 State of the Union address. "That would delay or derail it, and neither option is acceptable."

Women's rights advocates say enhancing food stamps and unemployment insurance benefits would inject cash quickly into the economy because it would target lower-income Americans--and by extension, many women--who would spend the money rather than save it or use it to pay down debt, steps that would not give an immediate boost to the economy.

At the same time, expanded unemployment insurance and food stamps would help women stay financially afloat in a downturn that hits them hardest, advocates say.

Women are more likely to have received sub-prime mortgage loans--even though their credit scores are equal to or better than men's--putting them at higher risk of foreclosure, according to the Consumer Federation of America, an advocacy group in Washington, D.C.


Subprime Loans Tilt to Women

In 2005, about one-third of female borrowers took on subprime mortgages compared to about one-quarter of men, according to the federation. Women and men use credit at the same rate, but women have an average credit score of 682, slightly better than men's 675 average, the federation found. A subprime loan is offered at a rate higher than other loans ostensibly due to the increased risk. The term "subprime" refers to the credit status of the borrower (being less than ideal), not the interest rate on the loan itself.

Women are more financially precarious even in healthy economies, advocates argue, pointing to factors such as wage discrimination, low-wage jobs and work hours trimmed by caring for family members.

With less wealth than men, they depend more on government aid and are more affected by rising energy and food prices. In their older years, women have lower income from retirement security programs and have less access to private pension accounts.

More money for food stamps is a particularly effective way to target the poor and boost the economy, said Joan Entmacher, vice president and director of family economic security at the National Women's Law Center. Food stamp benefits can be quickly deposited on debit cards and used almost immediately at grocery stores, providing an economic jolt that would help the economy and aid women in particular, she said. In 2006, nearly 70 percent of adult food stamp beneficiaries were women, according to the Department of Agriculture.

Sen. Tom Harkin, an Iowa Democrat who chairs the Agriculture Committee, is expected to offer an amendment to increase funding for food stamps.

"The House proposal has zero in it--zero--for food stamps," he said in a Senate floor speech last week. "Well, that has to be taken care of."

Allison Stevens is Washington bureau chief at Women's eNews.

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