Trump’s order on jobs wrong solution
President Donald Trump had the right inclination last week in issuing an executive order to extend emergency benefits to millions of unemployed Americans.
However, the order is confusing, potentially costly to states, and likely to face legal challenges because the president likely doesn’t have the power to make the changes included in the order.
But the president was on target with his professed motivation of taking action to prompt Congress to reach agreement on another stimulus package as the coronavirus pandemic and its economic consequences continue. A fuller stimulus package is a better way to handle the enhanced unemployment benefits and other aspects of an economic recovery plan than executive orders of questionable validity.
Unfortunately, there doesn’t appear to be much movement in Congress to negotiate a needed package. The Democratically controlled House passed a broad $3 trillion plan in May. Senate Republicans put out a $1 trillion plan that didn’t include many needed elements, such as financial help to local, tribal and state governments.
Surely, there is a lot of middle ground between these proposals that should be fertile ground for negotiations.
In the meantime, more than 30 million Americans are receiving unemployment benefits. They are unlikely to see a return of enhanced unemployment benefits any time soon.
As part of emergency spending to keep the economy afloat during the early days of the coronavirus pandemic in the U.S., Congress passed enhanced unemployment benefits of an additional $600 a week. The enhanced benefits, which help both workers who lost their jobs and the economy as a whole, expired in late July. Federal Pandemic Unemployment Compensation has pumped nearly $900 million into the Maine economy.
The House bill, the HEROES Act, would extend the $600 a week unemployment benefit until January. The Senate Republican HEALS Act would pay an extra $200 a week through September and then switch to a new system aiming to replace 70 percent of a recipient’s prior income when combined with state assistance.
After a breakdown in negotiations between the House, Senate and White House, the president released his own plan.
On Saturday, the president said he was authorizing the Federal Emergency Management Agency to allocate $44 billion to states. The money could be used for supplement unemployment benefits of $400 per week. States would be required to cover 25 percent of that cost. If unemployment numbers stayed the same, the match would cost Maine about $8 million weekly, according to the Maine Department of Labor.
In a statement Monday, Maine Labor Commissioner Laura Fortman said the department was seeking further information from the federal government about the order, saying details are “vague and include no information about how the program should be implemented or would work, raising serious concerns about the ability to deliver benefits to out-of-work Mainers in a timely manner.”
The department and the state’s unemployment system has already struggled to keep up with increased demand due to the pandemic. Adding new requirements and a new program could further delay help to the nearly 80,000 Mainers who have been receiving employment benefits.
In addition, Maine is expecting to see a budget shortfall of $1.4 billion over the next three years, according to one state estimate, making it unlikely that the state could pick up the cost of additional unemployment benefits.
“Asking states now to take on additional expenses is unresponsive to these needs and threatens important programs and services,” Gov. Janet Mills said in a statement.
The president’s order may be well intentioned, but Congressional action is required. The most direct — and effective — way to help workers is to extend the unemployment benefit that lapsed in July. The best way to help the country weather both the continuing pandemic and its economic fallout is to pass a significant stimulus package that focuses on boosting families, small businesses and state and local governments.