Jobless aid and family leave

For nearly 65 years, the federal unemployment insurance program, part of the 1935 Social Security Act, has provided a vital safety net for people who have lost their jobs though no fault of their own and who are actively looking for work. For nearly seven years, the 1993 Family and Medical Leave Act has guaranteed up to 12 weeks of unpaid absence to workers caring for newborn children and sick relatives and to attend to personal medical problems.

Now, these two important programs are headed for a collision on a course set by the Clinton administration, which is about to unveil a plan that will allow states to use their unemployment trust funds to pay benefits to new parents. While the goal of expanding access to this important leave is worthwhile, this way of reaching it creates needless conflict, is suspiciously political and, in reality, may not help.

The president suggested this rewrite of policy — defining voluntary parental leave as a form of unemployment — last spring and the Labor Derpartment is expected to announce the details of the new rules within a few weeks. Already, the proposal is under assault by congressional Republicans, business leaders and many state labor agency officials, who are opposed to Mr. Clinton’s expanding view of executive authority to interpret law and to the higher payroll taxes or reduced unemployment benefits that will result from the increased financial demand. The proposal has the support of organized labor, public interest and women’s groups, which have long lobbied for some type of income, subsidies or tax breaks for those taking family leave.

The supporters make this very good point: The Family and Medical Leave Act is skewed toward middle and upper-income workers; they have savings that allow them to take advantage of the unpaid leave. Low-wage workers simply cannot afford to go 12 weeks, or even two weeks, without a paycheck; whatever savings they had no doubt were used up preparing for childbirth or in medical care already provided to a sick parent or themselves. Some 650,000 people take parental leave as provided for under the law every year, yet more than three times that many working women — 1.9 million — have children under the age of 1. Clearly, there is a substantial gap between the law’s intent and its application.

But closing that gap by tapping into state unemployment funds would only open up another. Jobless benefits vary from state to state, but the average is $200 per week — not even subsistence level. As it is, a job hunt of any length can devastate the finances of a working family. To cover the added demand for paid parental leave, it is estimated that the unemployment insurance tax on employers would have to increase by 15 to 20 percent. It is unimaginable that any state legislature would increase the tax by anything close to that amount — the difference could only be made up by lowering jobless benefits that already are too low.

For Maine, this federal change to allow the state unemployment fund to cover parental leave would be a moot point. The last legislature wisely saved the fund here from impending insolvency with a combination of raising the tax and lowering the benefits, which, at an average of $174, already were well below the national level. There simply isn’t the money to cover this additional expense. And there never will be, since the bill enacted last session includes a requirement that lawmakers develop a “trigger” mechanism to lower the tax once the nearly depleted fund builds up to a sufficient level to cover unemployment claims. Most states, in fact, have laws in place that prevent the build-up of excess unemployment funds.

Still, this is expert political manuvering by the President Clinton. Parental leave is an important and very popular provision of law. By merely making this change available to the states as an option, the president, his party and his heir apparent will be seen by many voters as pro-family. Because this change is an option and not a mandate, the best argument opponents have is their concern about this unprecedented expansion of presidential authority. In this robust economy, they run the risk of being criticized as nit-picky and stingy.

Such criticism could be avoided. Since its enactment, a fundamental weakness of the family leave law has been the lack of access to the benefit by low-wage workers. Numerous remedies have come before Congress; none have gotten anywhere. A federal income tax credit specifically for low-income new parents is a particularly attractive proposal. It would be, compared to cash paymnts to all, relatively inexpensive. It would avoids the executive authority issue. It keeps the funding for a federal program where it belongs — at the federal level. And it might actually help.