Millions of Americans lose jobless benefits as $900B relief bill sits on President Trump's desk
Denitsa Tsekova
·Reporter
Sat, December 26, 2020
Unemployment benefit programs covering millions of Americans are ending as the stimulus deal passed by Congress, which would extend the programs, sits on the president’s desk.
“A complete unforced error,” Andrew Stettner, an unemployment insurance expert and senior fellow at the Century Foundation, told Yahoo Money. “At this point, [jobless Americans are] really at the edge, and they don't have any more further to cut. It's going to throw them into disarray.”
Around 14 million Americans currently rely on Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC), both of which are expiring on Saturday. While some unemployed Americans could move to another program, around 10 million will be ineligible. Nearly 5 million people are expected to fall into poverty in January as a result of relief provisions expiring.
“That’s the last week of compensable unemployment,” Stettner said. “Most people will probably get their final deposit into their bank account early next week, but they won't be able to claim any more benefits.”
U.S. President Donald Trump and First Lady Melania Trump exit from Air Force One at the Palm Beach International Airport on December 23, 2020 in West Palm Beach, Florida. President Trump is scheduled to enjoy a 10-day holiday visit at his Mar-a-Lago resort during the last Christmas of his precedency. (Photo by Joe Raedle/Getty Images)More
And even if the bill was signed now there would still be a lapse in benefits for the unemployed and reprogramming the benefit payments will take a few weeks.
“If the bill is signed then people are continuously eligible,” Stettner said. “Every day delayed adds to the complexity of getting the benefits back up and running.”
On December 21, Congress overwhelmingly passed a $900 billion stimulus deal that would extend both programs until March 14. But without the president signing the bill into law, the lapse is the earliest cutoff in extended benefits in any recession since 1985. Trump threatened he won’t sign it unless the current $600 stimulus check is increased to $2,000 creating uncertainty over the bill’s future.
The president didn’t say whether he’ll veto the bill but hasn’t signed it as of Saturday. In a tweet on Friday evening, Trump doubled down on his demand for bigger stimulus checks in any stimulus legislation.
A two-thirds vote in both chambers of Congress would be required to override a presidential veto. Complicating matters is that the bill is attached to another piece of legislation to keep the government funded. If Trump doesn’t sign the conjoined pair, the government faces a shutdown on Dec. 28.
As of Saturday, jobless Americans are facing their third benefit cliff in the pandemic. The extra $600 in weekly unemployment benefits under the CARES Act expired in July and the extra $300 under the Lost Wages Assistance (LWA) program expired in September.
“These people are going to fall into poverty, they are going to lose their homes, people are going to sell their cars,” Stettner said. “It's really a disaster.”
It’s not just unemployment programs expiring: The federal eviction moratorium, paid sick leave provisions, aid to state and local governments, and other relief expires at the end of December.
Around 3 million workers on PEUC may be able to move to Extended Benefits (EB) a federal program that provides additional 13 weeks but that program is also expiring in many states as their unemployment rates decrease. Only 18 states are projected to have the program in place by the end of December.
For jobless Americans, the $900 billion stimulus deal would have meant an extra $300 a week added to their benefits as well as PEUC and PUA programs extended so that people could receive benefits for another 11 weeks. Along with that, some overpayments would be waived, and some workers may even get an extra $100 on top of the $300 a week.
‘The pandemic has really exacerbated it’
As a result of the expiring relief, the number of people in poverty would increase by 4.8 million in January, according to an analysis by Columbia’s Center on Poverty and Social Policy.
“It's really keeping both the workers and their whole families, afloat,” Megan Curran, a postdoctoral research scientist, and co-author of the report told Yahoo Money. “But it also means that the workers and their whole families are at risk of losing out.”
Black Americans are falling into poverty in the greatest numbers during the pandemic and will be disproportionally affected by the current benefit cliff with 1.4 million expected to enter poverty in January.
“This disparity was a problem before the pandemic but the pandemic has really exacerbated it,” Curran said. “Job loss has hit them disproportionately and poverty, therefore, has also hit them disproportionately.”
Donald Trump golfed on Christmas Day with Lindsey Graham as he complained about the ‘pork’ contained in the latest Covid stimulus bill.
The outgoing president went to his golf club in West Palm Beach with the South Carolina senator as he continued to push back on the $900bn bill he has so far refused to sign.
The actual bill has now been flown to Palm Beach, where he staying at Mar-a-Lago, so it is available to sign.
Lawmakers reportedly have no idea if Mr Trump will sign the bill, veto it, or do nothing, which would see the federal government shut down at midnight on Monday, reports Politico.
But Republicans told Axios that they expect Mr Trump to sign the bill “in the nick of time.”
Mr Trump caused chaos earlier this week when he decided he would not sign the bill, which would give every American $600.
Despite his administration helping broker the deal, Mr Trump released a video calling for checks of $2,000 to be issued.
That idea was applauded by Democrats but quickly rejected by House Republicans on Thursday.
Around 14 million Americans are also set to lose their unemployment benefits on Saturday.
The president vowed he would “work tirelessly” over his Christmas break but he was also seen golfing on Christmas Eve.
It is the 31st golf vacation of Mr Trump’s presidency and takes the taxpayer cost of nearly 300 days of golfing to $151.5 million, according to HuffPost.
Read More
Read More
Trump addresses Covid in Christmas video before Twitter election rant
GOP blocks $2,000 checks as Trump leaves COVID aid in chaos
What is the current poverty rate in the United States?Current estimates on poverty in the U.S.
Donald Trump golfed on Christmas Day with Lindsey Graham as he complained about the ‘pork’ contained in the latest Covid stimulus bill.
The outgoing president went to his golf club in West Palm Beach with the South Carolina senator as he continued to push back on the $900bn bill he has so far refused to sign.
The actual bill has now been flown to Palm Beach, where he staying at Mar-a-Lago, so it is available to sign.
Lawmakers reportedly have no idea if Mr Trump will sign the bill, veto it, or do nothing, which would see the federal government shut down at midnight on Monday, reports Politico.
But Republicans told Axios that they expect Mr Trump to sign the bill “in the nick of time.”
Mr Trump caused chaos earlier this week when he decided he would not sign the bill, which would give every American $600.
Despite his administration helping broker the deal, Mr Trump released a video calling for checks of $2,000 to be issued.
That idea was applauded by Democrats but quickly rejected by House Republicans on Thursday.
Around 14 million Americans are also set to lose their unemployment benefits on Saturday.
The president vowed he would “work tirelessly” over his Christmas break but he was also seen golfing on Christmas Eve.
It is the 31st golf vacation of Mr Trump’s presidency and takes the taxpayer cost of nearly 300 days of golfing to $151.5 million, according to HuffPost.
Read More
Read More
Trump addresses Covid in Christmas video before Twitter election rant
GOP blocks $2,000 checks as Trump leaves COVID aid in chaos
The official poverty rate is 10.5 percent, based on the U.S. Census Bureau’s 2019 estimates. That year, an estimated 34.0 million Americans lived in poverty according to the official measure, 4.2 million fewer people than in 2018. According to supplemental poverty measure, the poverty rate was 11.7 percent.
Due to the COVID-19 pandemic, the response rate for the CPS basic household survey was 73% in March 2020, about 10 percentage points lower than in preceding months and the same period in 2019, which were regularly above 80%.
The official poverty measure was developed in the 1960s in conjunction with President Lyndon Johnson’s War on Poverty. Each September the U.S. Census Bureau releases an update of the national poverty rate for the prior year.
The official measure today is based on data from the Current Population Survey Annual Social and Economic Supplement. The survey is sent to U.S. households, so the poverty estimates do not include those who are homeless. The sample also excludes military personnel who do not live with at least one civilian adult as well as incarcerated adults.
While poverty rates according to the official and supplemental measures fluctuate from year to year, so do incomes relative to the Federal Poverty Level (FPL). According to the Census Bureau, 17.3 million people reported deep poverty in 2018, which means a household income below 50 percent of the 2018 poverty threshold. These individuals represented an estimated 5.3 percent of all Americans and 45.4 percent of those in poverty.
How high has the poverty rate in the U.S. been historically?
Historically, the official poverty rate in the United States had ranged from a high of 22.4 percent when it was first estimated for 1959 to a low of 11.1 percent in 1973. Since its initial rapid decline after 1964 with the launch of major War on Poverty programs, the poverty rate has fluctuated between around 11 and 15 percent.
Individuals also transition into and out of poverty over time, though many of those who are poor at any given time will spend multiple spells in poverty. Research shows that transitions into or out of poverty often happens after major life events such as marriage, divorce, or sudden changes in income. These transitions also can be associated with larger shifts in unemployment or wages.
What is the difference between the official and supplemental poverty measures?
The official poverty measure triples the inflation-adjusted cost of a minimum food diet and creates thresholds based on family size, composition and the age of the householder. Anyone living in a household with an income below their relative poverty threshold is considered to be in poverty.
The U.S. Department of Health and Human Services develops their Federal Poverty Guideline income thresholds based on the official poverty measure estimates. These income thresholds are used to determine eligibility for federal safety net programs, such as Medicaid or WIC.
Since the 1960s, new poverty measures, including the U.S. Census Bureau’s supplemental measure, provide a more complex understanding of poverty in the United States. The supplemental measure includes basic costs of living that can vary across states. It also includes transfers from safety net programs and in-kind benefits.
Updated 9/15/2020
For more information:
Semega, J; Kollar, MA; Shrider, EA; Creamer, J. Income and Poverty in the United States: 2019. Census Bureau, September 2020
The Rise of Extreme Poverty thein UnitEd StatES
The number of adults on welfare has dropped dramatically since its reform in 1996. As of 2011, a little over 1 million adults remained on the welfare rolls in a typical month, down from about 4.6 million at the program’s peak in the early 1990s. As these numbers plummeted, the number of single mothers joining the workforce or returning to it grew at rates that were largely unexpected.
For these reasons, welfare reform has been touted as a success.
At the same time, in the years since 1996, a new group of American poor has emerged: families with children who are living on virtually no income—$2 or less per person per day in a given month. These are America’s “extreme poor.” The U.S. official poverty line for a family of three would equate to roughly $17 per person per day. What scholars call “deep poverty”—income at less than half the poverty line—is about $8.50 per person per day, over four times higher than our cutoff. This new group of American poor, the extreme poor, are likely experiencing a level of destitution not captured in prior poverty measures, one thatfew of us knew even existed in such a rich country.
The purpose of this article is to expose the rise of extreme poverty and to examine how the safety net is—or is not—addressing it. We cannot fully address why extreme poverty is on the rise, but it may well be related to the landmark 1996 welfare reform. After 1996, it became far more difficult to get any cash assistance from the government if you didn’t have a job, even if you were raising young children and had no other sources of income.