White House clarifies limits of new jobless aid plan
Officials say states not required to add anything to their existing programs
Washington — President Donald Trump’s senior aides acknowledged on Tuesday that they are providing less financial assistance for the unemployed than the president initially advertised amid mounting blowback from state officials of both major political parties.
On Saturday, Trump approved an executive action that he said would provide an additional $400 per week in expanded unemployment benefits for Americans who have lost their jobs during the pandemic.
By Tuesday, senior White House officials were saying publicly that the maneuver guarantees an extra $300 per week for unemployed Americans — with states not required to add anything to their existing state benefit programs to qualify for the federal benefit.
The clarification came as the odds of a bipartisan stimulus package grew increasingly dim and state leaders clamored for the White House and Congress to approve new legislation that would more directly address the expiration of unemployment benefits.
The president and his senior advisers have expressed optimism that the economy does not need an additional package after the White House’s executive maneuvers. White House Chief of Staff Mark Meadows — the president’s emissary in negotiations with congressional Democrats — left Washington this week for an unspecified amount of time.
White House officials are privately studying other options for approving economic boosts without a deal with Congress, according to two people aware of internal conversations granted anonymity to discuss private conversations. For example, they are exploring whether more money could be repurposed for emergency pandemic relief.
But the White House’s willingness to go it alone may prove unsustainable. States have expressed frustration over the practicality of the president’s new unemployment aid plan because the White House initially suggested states would have to contribute more money despite major budget shortfalls. The president’s favorite economic indicator — the stock market — began slid Tuesday amid growing evidence an additional aid package was not on the way.
The tech-heavy Nasdaq, which had been trading near record territory, slid 186 points, 1.7%.
“The White House’s credibility is on the line here in terms of their ability to execute the stimulus they announced over the weekend. And the stock market is telling you here that whatever they’ve announced is not enough — more money is needed to keep the economy recovering, “said Chris Rupkey, chief financial economist at MUFG Union Bank.
Speaking on Saturday in Bedminister, N.J., Trump said he would repurpose unspent funding from the Federal Emergency Management Agency to provide enhanced unemployment benefits to tens of millions of Americans. Congress previously provided $600 per week for every person on unemployment, but that program expired at the end of July.
“$400. OK? So, that’s generous, but we want to take care of our people,” the president said. “Under this plan, states will be able to offer greater benefits if they so choose, and the federal government will cover 75% of the cost. So we’re all set up. It’s $400 per week.”
The Saturday directive from the White House said 75% of the new benefit would be paid for by the federal government. That was interpreted by many states to mean that they would have to provide an additional $100 per week for their residents to qualify for the benefit.
On Tuesday, White House National Economic Council Director Larry Kudlow suggested that adjustments had been made to that plan and that no new money is required from the states for their residents to qualify for the $300.
“We modified slightly the mechanics of the deal,” Kudlow told Fox News.
The White House guidance means all states will likely be able to implement the program without spending new money on aid. It also means people on unemployment will see their benefit effectively cut from $600 to $300 — a 50% reduction — rather than from $600 to $400.