Stimulus: ‘A growing sense of panic’ without fresh federal relief in sight

08/20/2020 USA


Since the end of July, almost a dozen more people show up every day for a free baked lunch at a homeless shelter in northwest Washington, DC, where tents support parks and street corners around the neighborhood. More than a third are new to the center, Charlie’s Place, which also distributes clothing and groceries.

“People have lost their jobs. They don’t get incentive money anymore. They just couldn’t keep up,” said Reggie Cox, director of the center.

There is support from both sides of the aisle to send a second round of checks, at least to extend some unemployment benefits and allow small businesses to apply for another loan so they can pay their workers. But Republicans, who control the Senate, and Democrats, who lead the House, remain far apart on the details, even after weeks of talks in July.

“Whatever your political affiliation, how could you not want to help these people? It makes good political sense to do the right thing here,” Cox said. “Our guests really think so.”

Millions of people are still unemployed

The package of financial aid passed by Congress in March received money fairly quickly from people at a time when lawmakers did not expect the pandemic to last that long. It offsets the decline in earnings more, according to a report by researchers from the University of Chicago and Notre Dame University.

But the economy is far from recovering. Consumer spending has fallen 8% since January and the number of open small businesses has fallen by almost 20%. The unemployment rate, at 10.2%, remains higher than at any point during the Great Recession.
Some people still wait weeks to get their unemployment benefits. As of last week, nearly 1 million people had applied for unemployment for the first time and more than 15 million were continuing to claim the benefits. Many states remain overwhelmed by the unusual number of applications they have to process.

But unlike earlier in the year when people also received incentive checks, benefits from state unemployment may be the one safety net program they can currently tap into – just as some lose the protection of eviction

“There’s a growing sense of panic,” said Behnaz Mansouri, a lawyer at the Unclaimed Law Project in Washington, which helps people combat denied claims.

“After receiving various supports, people managed their fears. But they no longer have that financial safety net,” she said.

Trump’s executive action is causing confusion

As Congress halted, Trump signed several executive actions, seeking to provide financial aid to Americans. But given the limited authority of the executive department to spend money, the actions do not do much of what he promised.

He described one memorandum as providing an additional $ 400 a week in unemployment benefits, with the goal of replacing the $ 600 a week benefit that expired July 31st.

But in reality, the benefit will be a total of $ 300 a week, unless cash-strapped states chip in the extra $ 100. Plus, it can take weeks before someone gets that money, because states have a whole new system have to set up to manage those benefits – and the money can only last a few weeks.

As of Tuesday, seven states had applied for the new funding, according to the Department of Labor. Florida, where the state’s maximum unemployment rate is one of the lowest in the nation, was not one of them. States must apply by September 15th.

“We’re constantly getting conversations,” said Laurie Yadoff, a South Florida Coast to Coast Legal Aid attorney, about the new benefit.

“They ask, ‘What’s going to happen to me?’ “They say they have late payments on their accounts, interest fines on their credit cards, and owe friends and family what they borrowed from,” Yadoff said. “They think I know what’s going on and I do not.”

.

Tags

Designed by Tricksfast Solutions
© Copyright 2024, All Rights Reserved