Don’t Prematurely End Payroll Tax Cut, Jobless Benefits

Almost lost in the fiscal cliff debate is whether to extend two programs, the payroll-tax holiday and extended federal unemployment benefits. They have helped gird the economy over the past four years by putting more money in consumers’ pockets. They should be continued, though perhaps in less-generous form.

Both initiatives will end in January absent . Although their expiration would save the U.S. about $145 billion next year, allowing the benefits to cease would shave about 1 percentage point off economic growth in 2013, according to estimates by the Congressional Budget office and others.