Today, the AP is reporting that the attempts to extend unemployment benefits is stalled in the House.

http://www.google.com/hostednews/ap/article/ALeqM5hLKyB9H7lUpiALFVlU7RRJa9-EfwD9GL73NG0

Previous attempts at extending unemployment benefits have also failed or are being held hostage on the Senate. In this writer’s view, the withholding of unemployment benefits from those in need is incredibly short sighted.

Just today, I received an inquiry from a gentleman who has been unemployed since 2008. He explained that his benefits had now just ended upon the failure of our ‘leaders’ in passing the much needed extension. He went on to explain that he was able to pay his credit card debt ‘alright’ up until the time the benefits were cutoff. Let me emphasize this, he was paying his credit card payments with his unemployment benefits!

Undoubtedly, some would argue that that is exactly what he should have been doing, paying his creditors. Others might argue that it’s well past time for this person to get a job, even in these tough economic times. Others might suggest that he should not have wasted his unemployment benefits to pay creditors, and he should have filed a bankruptcy, and used the benefits for his own betterment to find a job. Better training, re-training or assist in the job search.

Fine, I am not going to convince anyone that there is a right or wrong answer for the use of the benefits by this prospective client. I am suggesting that this story points up, whatever your view is on unemployment benefit payments, that the failure to extend the benefits shall result in obvious negative consequences. In this person’s case, he will ultimately file a bankruptcy. As, he is no longer able to pay his debts. Should he find a new job, likely he will be so far behind, that the filing of the bankruptcy will be inevitable.

Cutting off his benefits does society not one bit of good. Those benefits, however they were spent, are poured back into our economy, in the form of mortgage payments, rent, gas and electric, food, consumables, and other necessities of life. Ironically enough, in my gentleman’s case, he was doing the ‘right’ thing by paying and maintaining his credit card payments, at a high personal cost. No more, assuredly. Another bankruptcy filing due to the savings of ending unemployment benefits. Short sighted savings, indeed.

John C. Colwell

Debt Relief Legal Clinic

San Diego, CA

877-663-3287

Member, Board of Directors, NACBA

National Association of Consumer Bankruptcy Attorneys (NACBA)

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