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Lifeline at risk for 2 million jobless

By Tami Luhby, senior writer


NEW YORK (CNNMoney.com) -- Two million people will run out of unemployment benefits next month if Congress fails to act in the coming weeks.

The deadline to file for federal unemployment benefits expires on Nov. 30. If it is not pushed back, 800,000 people will stop getting checks within four days, according to the National Employment Law Project, an advocacy group.

Federal jobless payments, which last up to 73 weeks, kick in after the state-funded 26 weeks of coverage expire. These federal benefits are divided into tiers, and the jobless must apply each time they move into a new tier.

Nearly 9.5 million unemployed Americans have collected federally funded benefits, which average $290 a week, in 2010. Almost 15 million people are without work.

Jobless benefits are credited with keeping 3.3 million people out of poverty last year, according to the Center on Budget and Policy Priorities.

Unemployment benefits have become a political football, though the national unemployment rate has hovered just below 10% all year. Both parties have previously said they want to lengthen the federal safety net, but Republicans have temporarily blocked extensions several times this year because they do not want to add to the deficit.

When the deadline expired at the end of May, it took lawmakers 51 days to pass an extension until Nov. 30. The pricetag of that six-month extension was $34 billion.

It could be even more difficult to push back the deadline this time around now that the Republicans have won control of the House and gained seats in the Senate. Though the transfer of power doesn't happen until next year, Democrats will have to work with the GOP to craft a bill.

Congress has a narrow window to act. Lawmakers return on Nov. 15 for a week before taking off for the Thanksgiving holiday. Then they are back for only two days before the Nov. 30 deadline hits.

President Obama on Wednesday urged lawmakers to extend the deadline to file for federal benefits. The jobless pump that money right back into the economy by shopping for groceries and essentials such as winter coats for their children, he said.

"That's also why I think unemployment insurance is important," Obama said. "Not only is it the right thing to do for folks who are still looking for work and struggling in this really tough economy, but it's the right thing to do for the economy as a whole."

House Democrats are expected to push for an extension this month. Republican leaders did not return requests for comment.

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