The Nation

The unemployment insurance system has enough reserves to last only five months in a severe recession and would have to borrow billions of dollars from the federal government to keep paying benefits, the General Accounting Office said. Because states had to borrow $11.8 billion to keep paying benefits during the 1981-82 recession, most have tightened eligibility requirements so much that only one of every four jobless workers in October of last year received unemployment checks, the congressional watchdog agency said in a report. As of 1986, the GAO said, state unemployment insurance trusts still owed the U.S. Treasury a total of $4.8 billion.

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