Gov. Rick Perry wants $524 million from the Legislature to lure companies to Texas, but he may reject $556 million in federal money for residents who’ve lost their jobs.

How did our priorities get so out of whack?

The business of Texas may be business, but it’s shameful to deny help to thousands of laid-off workers during a recession, when it becomes even more difficult to find work. And it’s a suspect financial call, too, because Uncle Sam is offering to pick up the tab for five years or longer.

With the economic crisis deepening and reaching into Texas, that’s when the extra help is likely to be needed most. In recent weeks, the state has been paying twice as much in jobless claims as a year ago.

Oh, there are strings attached to the federal funds, and that’s the rub. To get the money, Texas has to expand its unemployment insurance program so more people will be eligible. The rule changes are technical, but the upshot is that they would extend benefits to more workers, perhaps even part-timers.

An estimated 45,000 more people would qualify for benefits under the changes, about 11 percent more than the 405,000 who received initial claims checks in 2008.

Is some expansion a bad thing, given that just 1 in 5 unemployed workers get benefits in Texas? That participation rate of 20 percent is well below the U.S. average of 37 percent and puts Texas next to last among states in this measure, ahead of only South Dakota.The Legislature has repeatedly rejected similar proposals to expand benefits in the past, but maybe the federal carrot will change some hearts and minds. The government says it’s trying to "modernize" claims processing to reflect changes in the workplace and help many who had fallen through the cracks before.

One required change would let filers qualify for benefits by counting their most recent weeks of employment; another would extend benefits to people seeking part-time work; another would eliminate the six-week waiting period for trailing spouses who give up their jobs to relocate.

The cost of these changes is estimated at $55 million to $100 million a year, depending on who’s estimating. But if we adopt them, the feds give Texas a lump sum of $556 million, enough to cover the costs for years.

After that, we’re on the hook. But it’s reasonable to hope that the economy will be stronger then and fewer will need the help.

Some in Texas see any expansion of unemployment insurance as the edge of a slippery slope, part of a broader effort to increase our dependence on the feds.

"It’s like a drug dealer," says Bill Hammond, president of the Texas Association of Business. "The dealer gives you the first hit for free to get you hooked, and then you are addicted and are paying the consequences for a long, long time."

Strong language, and not just from a guy who’s worried about his members paying higher taxes down the road. For three years in the mid-1990s, Hammond was chairman of the Texas Workforce Commission, which administers unemployment benefits.

He sounds almost proud of the state’s low participation rate, saying that people don’t get benefits "if they show up drunk or don’t show up at all."

"I think 100 percent of the people who are qualified get it," Hammond says.

That gives a sense of where some of the business lobby stands on the issue. The governor’s position is less clear.

Initially, Perry said that Texas shouldn’t accept any stimulus money, denouncing the "bailout mentality" in Washington and the debt burden it would create. He later softened his stance and said Texans deserve their share, because they’ll be paying for it.

In a letter to President Barack Obama last week, he was wary about some programs, echoing the position of several other Southern governors.

"I remain opposed to using these funds to expand existing government programs, burdening the state with ongoing expenditures long after the funding has dried up," Perry wrote.

Meanwhile, governors in California, Florida and Michigan (two of the three are Republicans) said they’d gladly take any extra money. Their people are hurting, they said, and they need it.

Texas has weathered the recession better than almost any state, and that’s one reason that Perry and others can be cavalier about federal help. They’re also scoring political points, even if they genuinely disagree with the expansion of government.

On Monday, Obama said that leaders had raised "legitimate concerns" about expanding unemployment insurance, but he pointed out that it represents a small fraction of the stimulus bill — less than 1 percent of total spending.

Other features of the stimulus require nothing from the state, except to take the money. The feds are increasing unemployment payments by $25 a week, a change that Texans will see by mid-March. And benefits are being extended for another 13 weeks.

The weakening economy is taking hold in Texas now, so there may be more support in the Legislature for expanding the system. In the week ended Feb. 14, the state paid $59.5 million in jobless benefits, compared with $24.5 million for the same period a year ago.

Initial claims topped 26,000 in the week, up from 11,226 last year.

There’s another strong incentive for the state to accept the federal money and new rules: The $556 million would help fill a billion-dollar deficit in the Texas trust fund that pays unemployment benefits. Otherwise, that hole must be filled from higher taxes on employers, borrowing from the federal government and selling bonds.

So it’s not enough that the feds will pay for the benefits for years? It’s not enough that the money closes a gap that would keep taxes low on employers, at least for a while?

How about this selling point: 45,000 Texans could really use the help.

I remain opposed to using these funds to expand existing government programs."
Gov. Rick Perry,
in a letter to President Obama