The COVID-19 pandemic has devastated the US economy and tens of millions of Americans’ livelihoods. From individuals to mom and pop shop owners, everyone is feeling the pain.
But for those who have relied on key provisions from the CARES Act, things are about to get worse — unless Congress can work out a bill before the holiday recess and the benefits expire.
According to CNBC, the Senate is hurrying to approve a stimulus package to allocate federal funds for struggling families and businesses. Last week a bipartisan coalition comprised of House and Senate members proposed a $908 billion bill that might be the ticket to getting more aid out to Americans.
Not much is known about the bill aside from the price tag. Lawmakers are racing to hammer out the details, which Louisiana Senator Bill Cassidy, a member of the coalition, said could be revealed this week.
While the specifics remain uncertain, a few things have been publicized. CNBC outlines what lawmakers may or may not include in this next bill.
If Congress approves this bill, it will offer unemployment recipients a critical financial lifeline during the pandemic. The price tag to renew key unemployment benefits is the second-highest within the deal, coming after $288 billion for small businesses and the Paycheck Protection Program (PPP).
According to an outline of the bill detailing cost factors, the bilateral group included $180 billion for “additional unemployment insurance.” It would also include funding for state and local governments, continued vaccine development and allocation, schools, renter and homeowner aid, and child care.
The bill also includes pandemic-related liability protections for businesses, a key measure backed by Senate Majority Mitch McConnell.
$300 Per Week
Enhanced unemployment benefits were among the most popular provisions in the CARES Act. Economists and other experts attributed the country’s rapid economic recovery to the $600 weekly payments, which spurred consumer spending and household savings rates. When the measure expired, the absence of aid undid most of the progress made during the spring and summer.
This latest bill would provide an additional $300 per week on top of regular state unemployment insurance — which may not send economic growth to the same level but would be critical support for out-of-work Americans.
Assistance For Self-Employed And Gig Workers
The $908 billion stimulus bill also extends unemployment benefits for groups typically exempt from regular state assistance, including the self-employed, independent contractors, and gig workers, Cole Avery, an aid for Senator Cassidy, stated.
The CARES Act broadened eligibility restrictions with the Pandemic Unemployment Assistance Program (PUA), so self-employed workers who experienced a loss of income during the pandemic could support themselves.
It also created the Pandemic Emergency Unemployment Compensation (PEUC) program, which provided 13 additional weeks of unemployment insurance to Americans who exhausted their regular state benefits, which typically lasts as long as six months.
The bipartisan bill would renew the PEUC, notes Rachel Cohen, a spokesperson for Virginia Senator Mark Warner, one of the measure’s creators. According to data from the Labor Department (DOL), renewing these measures would benefit the 13 million-plus Americans enrolled in the PUA and PEUC.
Independent contractors currently make up two-thirds of unemployment recipients. Unless lawmakers extend these programs, they will lose all government assistance by December 31.
“Adding the weeks is critical,” remarked Andrew Stettner, an unemployment expert and Century Foundation senior fellow. “Getting people through the winter with something is pretty vital.”
Will More Aid Arrive In Time?
For the millions of people on unemployment right now, time is of the essence. And unfortunately, it remains unclear if more help will arrive in time. Notably, many are unsure if the extra $300 weekly payments would be retroactive.
According to CNBC, Democrats are pushing for these benefits to be backdated to the beginning of September, when the Lost Wages Assistance (LWA) program expired.
According to Cohen, it’s likely that payments will not be retroactive, and jobless Americans would not have access to more relief until January 1. But some members of Congress have considered backdating the $300 payments to December 1. Since talks are ongoing, Cohen noted that this could change.
Lawmakers are also trying to determine how long additional PUA and PEUC benefits will last. McConnell proposed extending benefits for three months when he introduced a limited bill of his own. And last Sunday, Senate Minority Leader Chuck Schumer proposed extending unemployment for four months.
According to Evercore economist Ernie Tedeschi, who formerly served as an official in the Treasury Department, renewing supplemented unemployment payments, the PUA, and the PEUC would cost upwards of $140 billion.
Considering that the price tag falls $40 billion short of the recent bill’s $180 billion limit, that would give lawmakers “a little bit of room to work with,” Tedeschi noted.
- Iacurci, Greg. “Unemployment Benefits: What We Know (and Don’t) about the $908 Billion Covid Relief Bill.” CNBC, CNBC, 7 Dec. 2020, www.cnbc.com/2020/12/07/unemployment-benefits-whats-in-the-908-billion-covid-relief-bill.html.