Tax breaks for businesses led to state unemployment funds going broke

by Laura Clawson for Daily Kos Labor

Over the past four years, a whopping 36 states have had to borrow from the federal government to pay unemployment insurance benefits. Obviously a recession with high unemployment has a lot to do with that, but not as much as you might think. Tax breaks for businesses (PDF) are once again a hidden culprit for state budget problems.

A new report from the National Employment Law Project shows that, recession or not, many states could have avoided borrowing for unemployment payments if they hadn't spent a decade weakening their unemployment insurance trust funds by slashing employer contributions: