White House backs down

Governors pan order for states to provide extra $100 per week

President Trump backing away from a requirement that states kick in more money for unemployment insurance.

After complaints from governors about the expense, the Trump administration is backing away from a requirement that states kick in more money for unemployment insurance as part of an executive order the president issued Saturday.

President Donald Trump had proposed a new federal unemployment benefit of $400 a week with states covering a quarter of the cost or $100 per person.

White House economic adviser Larry Kudlow said Tuesday the administration had “modified slightly the terms of the deal” and would waive the state contribution, as long the state already paid people at least $100 a week in benefits. That means the unemployed would see a federal benefit of $300 a week, on top of their usual state unemployment benefits, unless their state decided to add more.

“States can still, if they put another $100 in to raise the benefit more generally, that’s fine,” Kudlow explained on Fox News. “Any state who put in $100 before, and every state did, they will then qualify for the extra $300.”

The U.S. Labor Department expects the new federal unemployment checks to begin in about two weeks, Kudlow said.

But since Trump announced the new proposal, state officials have been uncertain about when they might have to start implementing the policy or how much they might pay. Gov. Andrew M. Cuomo said Monday every time the administration describes the proposal it changes.

After Trump announced the new state obligation contained in his unemployment benefit, Cuomo said the concept was “laughable.” It would cost New York $4 billion over the next four months, money the state does not have. He also warned that it could take weeks for states to adjust to the change.

“Don’t redesign the mousetrap because the states won’t be able to implement that for weeks,” Cuomo said.

Gov. Andy Beshear of Kentucky said it could cost Kentucky $48 to $60 million a month, or more than $1.5 billion for the last three months of the year, “something that is just not possible for the commonwealth of Kentucky.” Gov. Ned Lamont of Connecticut said Sunday the proposal would cost Connecticut $500 million over the next four months.

The previous $600 per week federal unemployment benefit expired July 31 and Congress is embroiled in a battle over whether to renew it and at what amount amid ongoing coronavirus aid negotiations.

The average weekly unemployment insurance payment in June in New York was $337 per week, not including the $600 federal benefit, according to state Department of Labor spokeswoman Deanna Cohen said.

As of Aug. 1, New York had processed more than 3.2 million state unemployment insurance claims and 1.2 million federal pandemic unemployment assistance claims, Cohen said.

The Labor Department has paid more than $34 billion in benefits in 2020, compared to $2.1 billion paid last year.