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The U.S. economy appears to be heading for an iceberg in just over a week, thanks in part to a silly technicality that Congress accidentally overlooked when passing its coronavirus relief legislation in March.
Theoretically, the federal unemployment benefits of $ 600 per week that had been a lifeline for families during the crisis were supposed to expire on July 31. That was the date that most journalists, Capitol Hill employees and lawmakers initially marked their brains as the deadline for passing another round of pandemic aid so that jobless people don’t see a sudden and massive drop in their income. .
But it turns out that they all circled the wrong day. The problem is that July 31 is Friday, and states pay unemployment benefits based on the weeks ending on Saturday or Sunday. As a result, the last week of this month will not actually be covered by the $ 600 limit. The extra money will disappear after July 26 in all states.
Outlets such as USA Today and CBS have been reporting this point since at least the end of June, but it has failed to stimulate faster action on Capitol Hill. To make matters worse, once Congress finally takes action to renew payments, it will probably take states at least a couple of weeks to reprogram their old computer systems to deliver whatever new benefits Congress establishes, such as Michele Evermore, the expert. principal in unemployment insurance. in the National Project on Labor Law, she explained. If negotiations advance beyond August 1, some families may go a month without federal aid.
I asked Evermore if there was any way for states to fix this problem on their own, perhaps withdrawing their benefits weeks ago for a day, which in my head seemed like some kind of common sense solution. She said it would be essentially impossible, both for legal and technical reasons. “The benefit week problem is one of the hardest things to fix,” he said. “In most states, it’s in statute, and even where it isn’t, that kind of central program change is a nightmare.”
While this problem appears to have been the product of a congressional discussion, the Department of Labor actually explained it very clearly in a document issued on April 4. Somehow, it slipped through the cracks.
Despite the general success Washington has had in helping the unemployed through this crisis, many Americans still seem to be suffering. More and more people report having trouble eating enough. Households have been skipping loan payments, and many are concerned that the United States may be on the brink of a housing crisis this summer as the eviction moratorium is lifted. Cutting people off aid will only make those problems worse, while pushing the overall economy into a deeper hole. There were about 32 million people on the unemployment lists, according to the most recent government count. If the $ 600 increase goes away entirely, they will still receive normal state benefits. But on average, your income could be cut by more than half.
Not that Republicans care. Much of the party still appears to be convinced that the $ 600 increase in unemployment is preventing people from returning to work, a claim for which there is absolutely no evidence, and which is becoming increasingly absurd as the States close businesses like bars to treat resurgent coronavirus outbreaks. And although the White House has signaled that it would be willing to compromise the issue by extending benefits at a lower rate, perhaps between $ 200 and $ 400 per week, there are still no real negotiations between the two parties in Congress. Instead, Senate Majority Leader Mitch McConnell has said he plans to present a plan to his Republican colleagues next Monday, and only later share it with Democrats. (A source with Senate Democrats confirmed that they have still received “zero reach” from McConnell.) By the time the two sides can agree on something, there is a good chance these crucial benefits have been at least for a while. “Senator McConnell’s one-month refusal to engage in bipartisan talks on the next phase of federal aid legislation has created unnecessary uncertainty and pain for millions of families who are still recovering from the economic and public health crisis,” he said. Minority leader Chuck Schumer in a statement. statement.
So that’s where we are. The economy is on its way to its date with the abyss. And all Democrats can do right now is beg the Republican Party to walk away.
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