Governors criticize linking relief, unemployment

LINCOLN, Neb. — The Biden administration’s plan to funnel more coronavirus aid into states with greater unemployment has irked governors with lower jobless rates, though many have economies that weren’t hit as hard by the pandemic.

The $1.9 trillion relief bill working its way through Congress allocates extra money to larger, mostly Democratic-run states with higher unemployment rates, while rural Midwestern and Southern states that tend to have Republican governors and better jobless numbers would benefit less.

“You’re penalizing people who have done the right thing,” said Nebraska Gov. Pete Ricketts, a Republican whose state has reported the nation’s lowest unemployment rate over the past several months. “That’s not the way you want to approach any sort of government program.”

Ricketts was one of 22 governors — 21 Republicans and one Democrat — who have criticized the change in the pandemic relief plan. Under previous coronavirus packages signed by former President Donald Trump, aid was distributed by population.

The White House defended President Joe Biden’s distribution plan, saying it targets money to areas where it will have the biggest impact.

Iowa State University economist David Swenson said the White House’s approach makes some sense because the states with the highest unemployment rates are generally the ones that relied more on industries battered by the pandemic, such as tourism.

“If proportionally more people are unemployed in Las Vegas and California and other places that are entertainment destinations, then it would make sense to send money to those places instead of Iowa and Nebraska,” Swenson said.