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Plodding Progress Toward Stimulus Bill
US leaders are making bipartisan progress toward a second coronavirus stimulus bill, but caution that a deal is not “imminent”. Lawmakers from both sides of the aisle spoke in optimistic terms about talks held on Saturday. However, the weekend ended with no deal to show for it. The urgency for new relief grows to new heights as the $600 federal unemployment benefit officially expires.
Unemployment Benefits Expire
One of the more controversial elements of the original economic relief package was called the CARES Act. It was a $600/week boost to unemployment benefits. Many lauded the addition to the stimulus bill for helping to lessen the blow to laid-off workers. However, some also criticized it for going too far in paying non-workers.
With the added $2,400/month from the federal government, many people on unemployment are making more money than they were when working. Critics connect labor shortages in certain sectors to some Americans’ lack of incentive to get off their unemployment benefits.
This boost to unemployment, celebrated by some and criticized by others, expired last week. This puts pressure on the government to release another round of aid. While the benefits’ expiration is spurring new discussion, it is also the biggest bone of contention in the next stimulus bill.
Points of Disagreement
The Hidden Genius In The Democrats Unemployment "Bridge" Payments
That $600 a week unemployment payout got everyone accustomed to what a livable minimum wage really should be – $15 an hour…https://t.co/2DAhOEgewq— Andy Hawkins (@AndyHaw89285923) July 26, 2020
The extension of the federal unemployment benefit is the biggest sticking point between Democrats and Republicans. White House Chief of Staff Mark Meadows said that the president does not want to continue with the $600 unemployment payout. He cited the familiar argument that it “pays people to stay home”.
Nancy Pelosi rebuked Republicans for wanting to cut the $600 weekly unemployment benefit.
“The $600 is essential. It's essential for America's working families. And, again, to condescend, to disrespect their motivation is so amazing how insistent the Republicans are about working family and their $600 and how cavalier they are about other money that is going out.”
“Other money that is going out” likely refers to federal funds directed to companies, rather than individuals. The government has been criticized for heavily scrutinizing cash that goes directly to Americans, while focusing on less on the billions that large businesses have received in federal aid.
Trump’s Treasury Secretary, Steve Mnuchin, said that Democrats rejected an offer to temporarily extend unemployment benefits because they want something more permanent. He also said that the president shares the goal of a federal boost to unemployment benefits. However, he’s trying to temper the potential negative effects on worker incentive that such a large unemployment check could create.
Productive Weekend
Mnuchin struck an optimistic tone regarding the conflict:
“I think on the concept, we absolutely agree on enhanced unemployment. We want to fix the issue where in some cases people are overpaid and we want to make sure there's the right incentives.”
Both Pelosi and Mnuchin called Saturday’s meeting the most productive one yet, though they also said not to expect a deal in the near future. The biggest issue that is stifling the process is how much additional unemployment benefits Americans should receive. The challenge is to find an amount that keeps Americans secure during the pandemic, without creating an incentive to stay out of the labor force.
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