WASHINGTON — Expanded unemployment benefits, which have kept millions of Americans afloat during the pandemic that ended Monday, set off a sudden cut of aid to 7.5 million people as the delta version accelerates the recovery of the pandemic.
end of aid The president came without objection from Biden or his top economic advisers, who have been embroiled in a political battle over benefits and are now banking on an autumn pickup in other federal help and recruitment to keep vulnerable families from foreclosure and food lines. Huh.
The $1.9 trillion economic aid package signed in March included expanded and expanded benefits for unemployed workers, such as a $300-per-week federal supplement to state jobless payments, additional weeks of aid for the long-term unemployed, and an extension of so-called gig workers. Special programs to provide benefits to those who traditionally do not qualify for unemployment benefits. Monday’s expiration means that 7.5 million people will lose their benefits entirely and another 3 million will lose the $300 weekly supplement.
Republicans and small business owners have opposed the expansion of aid, arguing that it has stifled economic recovery and fueled labor shortages by discouraging people from looking for work. Liberal Democrats and progressive groups have called for another round of aid, saying millions of Americans are vulnerable and need help.
Mr Biden and his advisers have apparently refused to call on Congress to pursue profiteering, a decision that reflects the current outlook for recovery inside the administration and the president’s willingness to shift his political focus to his macroeconomic agenda. In support there is a desire to move to win.
The most senior economic advisers to the President say that the economy is in the process of completion The scuffle between federal aid and the labor market: As support from the March stimulus law, he says, more and more Americans are ready to return to work, receiving paychecks that would power consumer spending in place of jobless benefits, direct checks to workers and other government benefits. Help.
And Mr Biden is pushing Congress this month to pass two parts of a multi-trillion-dollar agenda focused on long-lasting economic growth: a bipartisan infrastructure bill and a larger, partisan spending bill. To invest in child care, education, carbon reduction. even more. The push leaves no political oxygen for an additional short-term aid bill, which White House officials insist the economy does not need.
Administration officials say March’s legislation that allows money to flow to Americans, including new monthly payments to parents, will continue to maintain the social safety net even when expanded federal jobless aid expires. . Mr Biden has called on some states – those with high unemployment rates and wishing to continue aiding unemployed workers – to use state relief funds from the March law to help the long-time unemployed. So far, no state has said it plans to do so.
On Sunday, Mr Biden’s chief of staff, Ron Klein, told CNN’s “State of the Union” that the March law was allowing states to help people out of work with employment bonuses and job training and counseling.
“We think there are jobs,” Klein said, “and we think states have the resources they need to move people from unemployment to employment.”
Mr Biden has faced criticism from left and right on the issue, and has responded with the Balancing Act, backing the benefits approved by Congress, but refused to pressure the state to increase them – or To defend them against attacks by governments.
Over the summer, business lobbyists and Republican lawmakers called on the president to cut benefits early, blaming him specifically for business owners’ difficulties in hiring workers in low-paying industries like hospitality. Soon after the reaction began, Mr. Biden profit defended But called on the Labor Department to ensure that unemployed workers who decline job offers do not lose their aid.
But nearly half the states, almost all of them led by Republican governors, went on to cut benefits on their own. Mr. Biden and his administration didn’t fight the progressives by angering them. The administration is essentially extending that policy into the fall, calling only interested states to fill in for the finished aid.
“I don’t think we need a comprehensive policy for unemployment benefits across the country at this point,” Labor Secretary Martin J Walsh said in an interview on Friday, as states vary.
Personally, some administrative officials have expressed openness to the idea that economic research will eventually show that benefits had some kind of chilling effect on workers’ decision to take up jobs. Critics of the additional unemployment benefits have argued that they are discouraging people from returning to work at a time when there are record numbers of job opportunities and many businesses are struggling to make rent.
Evidence so far suggests that programs are running maximum limited role in keeping people out of the workforce. For example, states that ended benefits early have seen little in hiring relative to the rest of the country.
Even in industries that have had the hardest time finding workers, many people don’t expect a sudden surge in job applications after benefits run out. Other factors – the challenges of childcare, fear of the virus, accumulated savings from previous waves of federal aid and a broad rethinking of Americans’ work priorities in the wake of the pandemic – are also playing a role in keeping people off work.
“I think it’s one piece of the puzzle, but I don’t think it’s the big piece,” said Ben Filesia, director of operations and strategy for the Pennsylvania Restaurant and Lodging Association. “It’s easy to point out, but I don’t think it’s the right reason.”
Progressives within and outside Congress have been dismayed by the administration’s approach to profit, warning that it could backfire financially. Job growth slowed in August as the Delta version spread nationwide.
“Millions of unemployed workers will be at a loss when benefits expire on Monday, and that didn’t need to happen,” Senator Ron Wyden of Oregon, chairman of the finance committee, said in a news release last week. “On this basis it is clear from the economic and health situation that we should no longer cut benefits.”
Elizabeth Anant, an economist at Barnard College who has been studying the pandemic’s impact on low-wage workers, said cutting benefits now, when the delta version threatens to roll back the recovery, could be both for workers and the wider community. is a danger. Economy
“We’ve got this fragile economic recovery and now we’re going to cut the income of those who need it, and we’re pulling dollars back from an economy that’s still very unstable,” she said.
Ms Anant is tracking a group of nearly 1,000 low-income parents in Philadelphia who were all working before the pandemic. Last year more than half of the people lost their jobs in the pandemic. As of this summer, 72 percent were working, indicating a strong rebound in the economy as a whole. But still 28 percent of their sample remained out of work, whether they could not find a job or because of child care or other responsibilities.
“We are moving into a new school year where there is going to be a lot more uncertainty for parents than this spring,” Ms Anant said. “Employers are again going to deal with a situation where they have people who want to work, but what should they do when their child is sent home for quarantine?”
Hunger and other hardship measures have eased this year, as the job market has improved and federal aid, including the expanded Child Tax Credit, reaches more low-income families. But a cut in benefits could change that, Ms Ananth said. “In the absence of any sort of solution, this rock comes and that number is going to go back up,” she said. “It’s a significant group of people who are going to be in a very bad position.”