Jobless needs mount as Congress debates benefits
WASHINGTON — Another round of COVID-19 relief legislation was complicated in Congress last week by a dispute over how to continue to provide unemployment compensation for millions of Americans. As jobless claims rise and the virus resurges, these citizens find themselves on shaky ground.
In competing plans to extend jobless benefits, lawmakers and officials said, they face a conundrum that boils down to creaky bureaucratic systems: The more you target federal funding to people who need it most, the slower the money reaches them.
Senate Republicans, as part of a $1 trillion package unveiled last week, proposed trimming extra weekly unemployment pay to $200, down from the current $600, in
August and September. The proposal then requires states, by October at the latest, to pay unemployed people an amount equal to 70% of what they had been making at work.
House Democrats support extending the current $600 per week benefit, which comes on top of the normal state-issued unemployment checks. In May, the House passed the HEROES Act, a $3.3 trillion package that extends the federal relief programs established under the CARES Act through the end of the year.
Senate Majority Leader Mitch McConnell, R-Ky., has rejected that bill. Mr. McConnell, however, is still working with White House officials to come up with a unified Republican plan, before negotiating with Democrats.
Rep. Mike Doyle, D-Forest Hills, said Senate Republicans and the White House were putting an arbitrary cap on spending during a pandemic that demanded more from Congress.
Lawmakers should be willing to spend what it takes, he said, to extend a durable safety net to Americans who are facing joblessness and the prospect of several months of rent and mortgage payments coming due.
“Now is not the time to be pulling back,” Mr. Doyle said. “This pandemic is going to be with us for the foreseeable future until we get a vaccine.”
Instead, Mr. Doyle said, lawmakers should consider ways to improve the accuracy of dollars flowing from Uncle Sam to struggling families.
“Is the package getting the resources where they need to be? Are we solving the situations we need to solve?” Mr. Doyle said.
That debate mirrors other COVID-19 programs designed to get money out quickly but at times distributed funds unequally.
The Paycheck Protection Program came under fire for issuing forgivable loans intended for small businesses to large publicly traded corporations with other finance sources.
The U.S. Department of Health and Human Services faced scrutiny for focusing initially on medical providers with Medicare reimbursements and delaying payments to Medicaid providers, like nursing homes and children’s hospitals. The agency said the move allowed it to push out money faster because it had Medicare information available.
And the $1,200 cash payments were delivered quickest to people who filed taxes online, while placing burdens on people with disabilities and older adults on Social Security. Rep. Conor Lamb, D-Mt. Lebanon, said last week his office has received about 1,000 calls from people who have not received checks.
Debate over benefits
Unemployment is one of the most hotly contested issues on Capitol Hill.
Congress approved a temporary but dramatic expansion of unemployment benefits in March, as the pandemic was crippling the economy and state governors were requiring nonessential businesses to shutter to stem the spread of the virus.
Lawmakers, in addition to opening up unemployment benefits to independent contractors and those without sufficient work history, provided an extra $600 a week, calling it Federal Pandemic Unemployment Compensation. Proponents argued the payment avoided bureaucratic hurdles that would have delayed the money.
Conservative critics claimed — and some Democrats later acknowledged — many workers are making more on the unemployment rolls than they would be on the job. Last month, a Strip District business owner told the Senate Finance Committee he struggled to get workers to come back and was forced to pay higher wages to make his employees even.
Mr. Lamb said in a town hall last month he believed the $600 checks were “an issue to confront.” Mr. Lamb was among 14 Democrats who voted against the $3 trillion House measure last month, which passed by a narrow 208-199 vote.
In an interview last week, Mr. Lamb said he voted against the Heroes Act because “it was just completely partisan” and said the pandemic called for compromise legislation with Republicans.
“I would be happy to support some other flat amount — but only if our bill also helps people with all the other things going on in their lives,” like rent, child care and health care, he said. The lower unemployment amount could be coupled with another round of stimulus checks, Mr. Lamb said.
“People who lost their jobs are hurting the most, and they’ll be hurting for the longest,” he said.
A nightmare
Technically speaking, lowering the $600 payment to $200 should be a relatively easy change for state unemployment agencies, lawmakers and federal officials have said.
But reconfiguring the system to pay a percentage of prior wages would be a nightmare, Mr. Doyle said in the interview.
Treasury Secretary Steven Mnuchin acknowledged the system challenges to reporters last week: “Let me just say, different states are in different places,” Mr. Mnuchin said. “Some states can implement this quickly. Some states will take time.”
Mr. Doyle said Pennsylvania unemployment officials had told him the change would be a challenge. It took state officials a couple of weeks to set up the software to begin paying the $600 checks.
“If you would change the whole way the program works, it would take them months to retool the software,” Mr. Doyle said.
In a statement, the Pennsylvania Department of Labor and Industry said it would take the state one week to alter flat weekly amount, like trimming the benefit to $200 a week.
But it takes state officials about 12 to 16 weeks to “essentially create a new system to pay each person a unique amount based on the percentage of their previous income,” a state spokesman wrote. Such a system would be “a significant distraction from claimants who are already waiting for staff to assist them,” the spokesman, Jahmai Sharp, wrote.
“The best way to help workers who are out of a job because of the pandemic is for Republicans in Congress to extend the $600 weekly federal benefit,” Mr. Sharp wrote.
Roughly 146,000 people were counted as unemployed in the Pittsburgh region as of June, according to the department’s figures released Tuesday. The region’s unemployment rate stood at 12.5%, compared with a 11% jobless rate nationwide.