Category: Fox Business

One could conjecture that as much as the coronavirus pandemic has hurt our economy, it is the ongoing failures of lawmakers to truly champion Americans in need, and the lack of existing systems to work for their benefit, that  have done at least as much damage over time.

This weekend, tens of millions of unemployed Americans stand to lose the emergency supplemental unemployment assistance that has helped them through joblessness during the coronavirus pandemic. The federal benefit supplement, part of the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act), will expire on Saturday. Senate Republicans can’t agree on a new coronavirus legislative package to present to Democrats, and it’s uncertain how, or if, the bill will address an extension to the federal emergency jobless benefit supplement.

While the Republicans haggle over what to include in a new relief bill, millions of Americans fear losing their homes, no longer having health insurance, and figuring out which bills to pay and which they’ll have to let go for now.  Some are still waiting to begin receiving their first round of unemployment benefits, due to outdated and backlogged claims processing systems in various states.

Back in May, House Democrats passed an economic stimulus bill that would, among other things, extend the federal unemployment benefit supplement created in the CARES Act through the end of the year, as well as provide another round of one-time stimulus checks to Americans. That bill, however, has been sitting on Senate Majority Leader Mitch McConnell’s desk.

GOP Senators hope to agree on their own bill to present to Democrats by Monday, July 27. It’s not certain whether the bill will include an extension of the emergency unemployment benefit, or whether that will be addressed separately.

The GOP bill is expected to include, among other items, funds for schools, some of which would be tied to reopening classrooms. It would also include a new round of stimulus payments to individuals. McConnell, however, is pressing for the stimulus payments to go only to Americans earning less than $40,000 a year, which would leave many Americans falling through the cracks.

President Trump had pushed for including a payroll tax cut, possibly instead of extending federal unemployment benefits. Though he had threatened not to sign a bill without a tax cut, Republicans have resisted, since it would only help those who still receive paychecks. Additionally, it would drain the Social Security and Medicare trust funds.

Reflecting the perspective of someone who has apparently never experienced financial hardship, conservative economist Stephen Moore, who advised Trump during his 2016 campaign, disagreed. “We’ve gone in less than 10 days from Trump saying that he won’t sign a bill without a payroll tax cut to the bill they’re drafting not having a payroll tax cut,” he said. “There is no benefit from dumping money from helicopters into people’s laps.”

If the supplemental benefit is not extended, unemployed Americans will revert back to receiving only their state unemployment benefits, which average $370 per week. One could argue that they are the people who would benefit from some money dumped into their laps.

Many Republicans have agreed on temporarily extending the emergency unemployment benefit, but reducing it from the original $600 per week to $200 per week.

But, says Ernie Tedeschi, who was a Treasury Department economist during the Obama administration, “U.S. Gross Domestic Product would be 1.33 percentage points smaller at the end of the year than if the benefit were extended at $600 per week for the rest of the year.” He added that the resulting reduction in spending would lead to more than 1 million fewer jobs.

Other Republicans oppose extending the unemployment supplement at all because they worry that it will be a disincentive for jobless Americans to return to work. A “back-to-work” incentive payment has also been suggested instead of an extended jobless benefit supplement.

“It’s not a difficult concept. You don’t get paid more to stay home than you do when you have a job,” said Treasury Secretary Steven Mnuchin.

Perhaps they’re thinking that Americans should just heed Ivanka Trump’s tone-deaf advice and “find something new,” even in the midst of the coronavirus pandemic.

As Senate Republicans dicker over how little assistance they can get away with giving Americans, and what stipulations they can put on the assistance, it’s apparent that what concerns many Republican lawmakers most is the fear that some American somewhere might get a dollar he or she isn’t entitled to. They fret over the possibility that someone might not be jumping through enough hoops for the assistance they receive.

But let’s suppose that for some Americans, the lack of motivation to seek work is due to the fact that their unemployment benefit is greater than what they’d earned at their jobs. When someone can earn more from a jobless benefit than they can when they work full-time (or more), the problem is not with the employee, it’s with the lack of a livable minimum wage.

Republican lawmakers continue to collect their salaries and enjoy their excellent health insurance as they fail to act on behalf of American workers. Their squeamishness for what they see as “handouts,” and the requirements they continually want to set up to ensure that no one gets “too much” have perpetuated an inept and inadequate social welfare system, leaving many hardworking Americans without a safety net– especially if they were living paycheck to paycheck during better economic times.

When millions of Americans have no safety net, or fall through the holes of a weak safety net, it reverberates throughout the U.S. economy. The coronavirus pandemic has only magnified this. It may have exacerbated our economic situation, but more than that, it has highlighted the glaring ways in which our system has failed, and continues to fail, many Americans.

White House and Republican senators reach tentative deal on new coronavirus stimulus package | CBS News [2020-07-23]

Coronavirus stimulus: Mnuchin says there is a ‘fundamental’ agreement between White House and GOP | Yahoo Finance [2020-07-23]