Dems Say Make Business Suffer, Only Support Tax Hikes for Employers

House Democrats say they will only support tax hikes on employers in order to fix the failing state unemployment insurance fund. Republicans back balanced plan to spread the burden around and minimize the damage to businesses which provide jobs for Hoosiers.

After refusing to take action on the bankrupt state unemployment insurance fund (forcing the State Senate to make a proposal first) the House Democrats have finally produced their plan to save the unemployment fund.  Unsurprisingly, their plan consists only in tax hikes for businesses, businesses which employ people and are struggling during the current recession.  Senate Republicans submitted a balanced plan to tighten benefits eligibility, lower some benefits, and also raise taxes on businesses (but not as much as the Democrat plan).  Following are excerpts from news stories:

News 22 explains the problem:

It's a position no state wants to find itself in. Hundreds of thousands of people out work and the unemployment insurance fund: Bankrupt.

The State of Indiana has borrowed more than $500 million in federal loans to keep the system running while lawmakers come up with a way to fix it and pay the loans back.

The Evansville Courier Press explains Niezgoski's proposal:

Employers would pay higher taxes but jobless benefits would remain unchanged under a plan to fix the state's unemployment insurance fund which House Democrats announced Monday.

Rep. David Niezgodski, D-South Bend, said the party's plan would require businesses immediately to pay higher tax rates over a larger portion of their employees' paychecks.

As does the Indianapolis Star:

Their solution relies strictly on raising taxes on employers.

The Courier Journal explains how the Democrat plan could hurt Hoosier businesses in difficult economic times:

George Raymond, a lobbyist for the Indiana Chamber of Commerce, told the conference committee yesterday that the proposal would triple the total premiums paid by employers, an increase that would cause layoffs statewide.

"Given the economy we're in, that's a tremendous additional burden," Raymond said.

Mr. Niezgodski's plan may sound like it stands up for Hoosier workers, but it will likely have the unintended consequence of causing even more Hoosiers to loose their jobs and more businesses to close their doors.

While opposing all benefits cuts sounds popular, it only makes sense if your real goal is hurting Hoosier employers, causing more layoffs, and making more people dependent on state government.