The weekly $ 600 increase in unemployment insurance payments is likely to expire before lawmakers reach an agreement on the next coronavirus relief package, raising the stakes for the negotiations and creating more uncertainty for people. who depend on government help.
Because most states process payments on a weekly cycle that ends on Saturdays or Sundays, states will stop paying the additional $ 600 in July 25 or 26 unless Congress acts quickly. But negotiations between the House and the Senate are not expected to begin in earnest until early next week, and the two sides remain far apart in the contours of a deal.
That runs the risk of leaving unemployment insurance beneficiaries in limbo as negotiations unfold. Even if Congress acts to renew weekly attendance in late July or early August, the gap could lead to a one-week delay in the delivery of additional payments.
“We may no longer have time to avoid the iceberg,” said Representative Don Beyer (D-Va.), Vice President of the Joint Economic Committee.
Adding even more uncertainty, Republicans now suggest reducing the weekly increase to $ 400 or less, out of concern that some recipients may receive more money than they earned before losing their jobs during coronavirus blocks.
Speaker Nancy Pelosi
Nancy PelosiHow Republicans Can Embrace Environmentalism And Win NIGHT ENERGY: Court Takes Down Trump Administration Methane Reversal | Power Regulators Keep Compensation for Rooftop Solar Power Producers | Democrats target Confederate monuments in spending bill Pelosi urges Trump to take advantage of emergency powers to meet medical team, evidence needs (D-Calif.) He noted openness to compromise with Republicans about the size of weekly payments, depending on whether there is another round of stimulus checks for people included in the package.
“I am totally for $ 600,” Pelosi said during a Capitol press conference on Thursday, adding that “the entire package will depend on what we do also for direct payments, which are so essential.”
“So when they’re giving away all this great money and worrying about $ 600 for the families who desperately need it, that makes you wonder, who are they here for?” Pelosi said of the Republicans.
The Labor Department reported Thursday that approximately 1.3 million Americans filed new claims for unemployment benefits during the second week of July. It was estimated that a total of around 32 million people were claiming unemployment insurance or Pandemic unemployment assistance for concert workers.
While the United States has recovered nearly 8 million of the more than 20 million jobs lost since the coronavirus pandemic forced the closure of businesses, weekly unemployment claims have exceeded 1 million since the end of March.
The $ 2.2 billion coronavirus relief law enacted on March 27 provides an additional $ 600 per week in unemployment insurance payments through July 31. Since the end of the month falls on a Friday, states would need an extension before July 25 to fully cover the last week of July that runs through August. Otherwise, beneficiary unemployment insurance payments will be reduced to the level established by individual states.
Even if Congress extends the improved unemployment insurance in some way and makes late payments retroactive, the delays would come at a time when most beneficiaries face an August 1 deadline for rent or mortgage payments, in addition to other monthly bills.
“There are people who are embroiled in these terrible situations for the moment, for the period that is absolutely unnecessary,” said Heidi Shierholz, a senior economist and policy director at the left-wing Institute for Economic Policy.
Leader of the Senate majority Mitch McConnell
Addison (Mitch) Mitchell McConnell The Cost and Benefits of Filling Federal Appeals Court Vacancies Hill Campaign Report: Trump Campaign Revives Amidst Difficult Patch Study: Improved Benefits Helped Increase Spending of the unemployed in the pandemic MORE (R-Ky.) He said this week that the upper house will not begin negotiating a coronavirus aid package until next week when the senators return to Washington after a two-week recess.
“I think I could anticipate that this will hit a tipping point sometime in the next three weeks, starting next week,” McConnell said.
House Democrats passed a $ 3 trillion coronavirus relief bill two months ago that would extend the $ 600 increase in unemployment insurance through January, in addition to providing a second round of direct payments of up to $ 1,200 for individuals and $ 6,000 for families with children.
Senate Republicans have refused to accept that bill. Instead, Republican lawmakers and Trump administration officials have decided to renew the weekly unemployment payment for a smaller amount or limit it in such a way that the total does not exceed the recipient’s previous income.
treasury secretary Steven Mnuchin
Steven Terner MnuchinOn The Money: Weekly Unemployment Applications Decline, But Remain Above 1 Million | Blacks, Hispanics are less likely to receive stimulus checks quickly | Growing number of retailers requiring White House masks across the country: Trump believes payroll tax cut ‘must’ be part of COVID-19’s next aid package Progressive group launches M ad purchase Biden Targeting Young Voters MORE He told CNBC last week that “it can be assumed that it will not be more than 100 percent” of a worker’s previous salary.
The Chamber of Commerce on Thursday asked for a “middle ground” of 80 to 90 percent of a worker’s previous wages and a maximum of an additional $ 400 per week or $ 200 for states that cannot adjust their computer systems to the new quantity. The business lobby group also called for phasing out of payments based on the unemployment rate.
Improved unemployment insurance is far from the only item to be resolved in talks about the upcoming coronavirus aid package. Direct stimulus payments, aid to help schools reopen safely, financing for state and local governments, and liability protections for businesses will be part of the negotiations.
If Congress does not act to extend the enhanced unemployment insurance until after it expires, payments will not resume immediately.
Experts estimate that it would take at least two weeks for recipients to get the weekly funding boost. That delay could be even longer if Congress makes significant changes to the way payments are calculated.
Michele Evermore, principal investigator and policy analyst for the National Labor Law Project, said that if the amount changes from $ 600 a week, “it shouldn’t take more than a couple of weeks” for aid to reach recipients.
“But if you change it to a percentage of previous earnings, it would take months, because they would have to redo everything about how benefits are determined,” he said. “And anything that exceeds the state-level benefit is federal, so they must count it separately. It would be hugely complicated. “
Mike Lillis contributed.
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