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As Washington bickers, long-term unemployed face peril

Alecia Warthen’s heart dropped when she discovered her 11-year-old daughter’s online search history.
Job seekers wait in line at Kennedy-King College to attend a job fair hosted by the city of Chicago on November 9, 2012 in Chicago, Illinois. (Photo by Scott Olson/Getty Images)
Job seekers wait in line at Kennedy-King College to attend a job fair hosted by the city of Chicago on November 9, 2012 in Chicago, Illinois.

Alecia Warthen’s heart dropped when she discovered her 11-year-old daughter’s online search history.

“Dog sitter,” Warthen lamented, letting out a long and tired sigh, punctuated by a chuckle. “My daughter had been searching for dog sitting jobs to help out with our finances.”

For Warthen, a 43-year-old single mother of six in the Bronx who was laid off from her city bookkeeping job more than nine months ago, the dog-sitter thing was as heartwarming as it was heartbreaking.

“It’s very hard. I’m trying to do everything that I can to keep my spirits up, believing that it’s going to get better soon,” Warthen said. “I keep holding on, but it’s just not happening. It just seems like I can’t see the light at the end. I try to psych myself up but I just don’t know.”

Washington has been filled lately with talk of the fiscal cliff: the tax increases and spending cuts that will automatically kick in if President Obama and Congress don’t shake on a deal by the end of the year. But Warthen said she’s already tumbling down a fiscal cliff of her own.

Barring some sort of Christmas miracle or at least some rare bipartisan good will this Christmas, Warthen will receive her last emergency federal unemployment check on Dec. 29.

She’ll be joining roughly 2 million other unemployed Americans who are scheduled to lose Emergency Unemployment Compensation benefits unless Congress chooses to extend them. This group represents the long-term unemployed, those who’ve been out of work for more than six months and have already maxed out their state unemployment benefits.

“When you’ve been out of work for six months you’ve probably gone through all of your savings. There’s not a lot left for people to juggle,” said Judy Conti, federal advocacy coordinator for the National Employment Law Project. “We’re talking about 2 million people, families who all of a sudden will be without benefits in the middle of winter, with heating bills, with people needing shelter and food. These benefits have kept upward of 2 million people out of poverty.”

“It’s horrific to even imagine the number of families that could be affected,” Conti said, noting that another 5 million people that could qualify for extended federal benefits but would not be able to receive them.

Back in February, Congress agreed to extend emergency unemployment benefits, though on a reduced time-frame and only in high-unemployment states. But that extension is scheduled to run out at the end of the year. As President Obama and Republicans negotiate over the fiscal cliff, advocates for the jobless are urging them to include a further extension in any deal.

A White House proposal on the fiscal cliff offered earlier this week included an extension of jobless benefits, but was immediately shot down by Speaker John Boehner. And Boehner's failure Thursday night to get the GOP-controlled House to pass a tax cut extension for those making up to $1 million suggests the prospects for a broader deal are bleak.

If the two sides don’t reach a deal—or if they reach one that doesn’t include an extension of unemployment insurance—only about 3 million unemployed workers, out of a total of 12 million, will be receiving benefits.

But keeping the program in place wouldn’t just offer a crucial lifeline for millions of struggling Americans. It also would help boost economic growth. That’s because unemployed people count on their benefits for daily necessities like food and transportation, so they have little choice but to spend them right away, injecting that money into the bloodstream of the economy. “[Unemployment benefits] provide an especially large economic boost, as financially stressed unemployed workers spend any benefits they receive quickly,” Moody’s chief economist Mark Zandi wrote in testimony to Congress this year.

The hit to the economy could be significant. Cutting off emergency benefits would reduce growth by $48 billion in 2013, costing 300,000 to 400,000 jobs, according to the Congressional Budget Office.

Warthen says that if she loses the $405 in benefits that she receives each month, she’ll have absolutely no income at all.

“I thought that I would never have to rely on any type of assistance,” Warthen said. “It was just not me. I’m used to working, that’s how I’ve always been.”

Warthen’s bachelor’s degree in accounting hasn’t translated into many job interviews, even fewer nibbles. She said she’s registered with all of the big online job sites, checks various job boards several times a day and has a handful of temp agencies on speed dial. She’s followed up on every lead from friends and friends of friends all across New York, even far-flung sections of Queens where the subway doesn’t run.  She’s even started applying for jobs at local supermarkets: Associated, FoodTown, Kleinsfield, Key Foods.

“I don’t care,” she said. “I’ll stock shelves, work the register, do payroll, accounts payable. Anything.”

In April, just a week or so after her supervisors at the city’s child support enforcement agency warned of pending cuts, Warthen and about 80 others in her unit were laid off.

During the first weeks and months Warthen said she was full of optimism and hustle. She pulled together a business plan and tried to generate some extra income.

She made homemade natural hair care products and body butters. But the special oils she used got too expensive. She tried her hand at interior design work and as a seamstress, making prom gowns and women’s clothing. Then, in May, her sewing machine conked out.

“When it rains it pours,” she said. “I thought that would be my ace. I just cried.”

She planned on sewing her daughter’s prom dress but without her sewing machine she had to hustle up the $80 or $90 for her daughter’s gown.

Each morning Warthen wakes up early, about 6 a.m., the same as she did when she was employed. For a while she’d hop on her computer and check all the online classifieds, job boards and employment sites like Monster and Indeed. “I’m registered with all of them,” she said.

More recently her computer went the same way as her sewing machine. "Blue screen of death," she called it. More rain.

These days she heads over to the library, where they only allow computer users 45 minutes.

Things got harder. Her 18-year-old daughter was enrolling at the College of New Rochelle. Her son, 23, was in the same position she was in, unable to find work. In nine months she’s been off she said she’s sent out more than a hundred applications but only went on a grand total of three job interviews.

She’s grown tired, frustrated, depressed.

The stress is beginning to take its toll on her. The headaches are more frequent, more intense. Her mother, who lives in Georgia, has suggested that the South might offer more opportunity. Warthen bristles: “I can’t admit defeat. That’s like going down to be with my mother.  I just can’t.”

Plus, family and friends already down there say the bugle of the South that had for years sounded promise, jobs and affordable homes, has dimmed a bit with the recession. “The same thing going on up here is going on down there,” she said.

Now, with her financial situation growing increasingly dire and Dec. 29th dangling over her head like a guillotine, Warthen has made plans to take money from her life insurance policy and her 401K.

Being the lone provider for her family leaves her in a particularly tough situation. Birthdays and holidays are much lighter affairs these days, more about family bonding than about big gifts. And it hurts her heart to know that the stress and worry is trickling down to her youngest. After questioning her daughter about her prospects of becoming a dog sitter, she said the little girl looked up at her and said, “I’d be helping you.”

“You try to hold it down on the home base, and work, and there are not a lot of jobs out there. If there are I don’t see them,” she said. “The newspapers report that unemployment rates are falling, but I don’t think that’s giving a true picture. Some of us are falling through the cracks.”