WASHINGTON – In Wednesday’s meeting of the budget conference committee, U.S. Senator Chris Coons (D-Del.) questioned the head of the Congressional Budget Office about the impact of Congress’ current spending decisions on the nation’s long-term unemployed.

“While short-term unemployment has come back down, long-term unemployment remains very high, and is persistent — and worryingly so, both in terms of the human cost, and the long-term cost for our economy,” Senator Coons said.

Questioning Congressional Budget Office Director Douglas Elmendorf, Senator Coons continued: “You've testified before that not all cuts are the same, and that there are some ways in which we are cutting that are hurting our long-term competitiveness — that short-term cuts in things like education, or infrastructure, or research and development produce longer-term reductions in our capacity; and that we should be prioritizing things that will accelerate growth; that we should not be simply trying to get through this difficult fiscal time in a way that focuses on austerity; that we should also be investing in a way that sustains growth.”

Asked about policies that could accelerate growth and help the long-term unemployed, Director Elmendorf said, “Of all non-defense discretionary spending, half represents investment of some sort. About 20 percent of non-defense discretionary spending is investment in physical capital, such as highways, another 15 percent goes for education and training, and about 10 percent goes for R&D, such as health research. Over all, we think those investments help to build a stronger economy in the future and cutbacks in those investments would reduce output and income in the future.” 

The problem of long-term unemployment, Elmendorf noted, also “has important economic effects over time… It poses a very large risk of there being some set of people who will not find their way back to work at all or will not find their way to the productive sort of work that they were in before they lost their jobs.”

Elmendorf said the CBO has “reviewed the evidence on a large number of different ways of trying to help people get back into the labor force,” a number of which “have been successful on a small scale and have not been tried on a large scale.” Elmendorf pledged to work with Senator Coons on developing policies that help the long-term unemployed get back to work.

Delaware’s long-term unemployment rate is 3.1 percent. The state’s overall unemployment rate is 7.3 percent. 

Senator Coons is one of 29 members of the conference committee appointed by leaders of the House and Senate to reconcile the two chambers’ respective budgets. If the conference committee is able to negotiate and approve a budget by December 13, the House and Senate appropriations committees will attempt to move forward on a spending bill for the remainder of Fiscal Year 2014. As a member of the committee, Senator Coons has called for balanced deficit reduction that enacts a circle of protection around the most vulnerable and promotes our long-term competitiveness and economic growth.

Senator Coons is a member of both the Senate Budget Committee and the Senate Appropriations Committee.