Last week, 29 million people in the United States collected unemployment benefits of some sort and, according to the federal Office of Management and Budget, nearly one-third of households in New York now fear they will lose their homes.
The official August unemployment figure of 8.4% is high but the full picture is far more daunting. Much of the difference is due to the 13.5 million self-employed people, freelancers and gig workers who are being supported by the Pandemic Unemployment Assistance program. That’s a program that never existed before COVID, and is set to expire on Dec. 31 unless Congress acts.
The numbers add up to a simple reality: nearly 20% of the nation’s workforce is getting by thanks to either traditional state unemployment benefits that had been supplemented with $600 a week from Washington, a number now reduced to $300 a week in some states and zero in others, or the new program for non-payroll workers. Over 2 million people in New York alone are getting those benefits. And most who fear impending eviction or foreclosure have not actually been cast out.
That’s because the economy has been frozen, but not yet destroyed, by the spread of the coronavirus and the emergency measures taken to stop that spread. Full economic destruction has been held at bay by federal government aid, mostly via the CARES Act passed in March, which injected $3.3 trillion into the economy, sent checks to most Americans and created protections against eviction and foreclosure which are now expiring.
That initial round of aid is disappearing. If federal aid is not quickly renewed for American families and individuals who need it, and given to state governments to award to schools, counties and cities, the result could be an economy in unprecedented free fall cascading into decades of damage. Homes and jobs will be lost and entire industries will be permanently crippled. New York City and Long Island, which are tied together in the regional economy, will be especially devastated. The state has a budget hole of $30 billion due to the virus.
But in the face of this threat, Republicans in Congress and President Donald Trump are negotiating in shockingly bad faith, putting forward ever-smaller aid proposals even as Democrats have reduced their demands to move closer to compromise.
House Democrats passed a $3.4 trillion kitchen-sink aid bill in May that was clearly an opening volley. Much of what it provided, like extending the enhanced unemployment benefits and aiding businesses large and small, is needed. But there was plenty of fat there, including oversized grants for states and municipalities not hit especially hard by the pandemic, and allocations larger than anything those governments had even asked for.
In response, Republicans in the Senate did nothing for four months, then on Thursday sent a bill to the floor that included about $350 billion in new spending — and the reallocation of $350 billion already approved — that was laughably inadequate. It included $300 a week in enhanced unemployment benefits, half of what the CARES Act provided, and even that would end on Dec. 27. There was some aid for schools, farmers, small businesses and the Postal Service. It did not pass.
It was tiny even compared to the GOP’s own opening bid of $1 trillion in aid offered months ago, and it contained no help for states or municipalities or for devastated transit systems like the Metropolitan Transportation Authority. In criticizing the legislation, Democratic Minority Leader Sen. Chuck Schumer argued that if public transportation agencies such as the Long Island Rail Road were decimated, "the damage to regional economies and the national economy would be severe." The GOP bill also had no mention of a new round of $1,200 stimulus checks to most American families that both parties and Trump have generally supported. Including it would have indicated the dead-on-arrival GOP bill was more than just a political ploy.
The Republicans are engaging in a strange gamble in which the nation would lose even if their party won this stimulus battle. Thursday's bag-of-crumbs of a bill, which Majority Leader Mitch McConnell couldn't pass even in a chamber he controls, was nothing more than a weak effort to say, "We tried!"
A vaccine cannot arrive and be widely administered quickly enough to stop the national devastation only a large stimulus plan can prevent. The pandemic's financial strains are a national problem, and reliably Republican states need help just as much as solid Democratic ones do.
More importantly, the American people need help, regardless of their party affiliation.
And once state and local governments and school districts, crushed by disappearing tax revenue and increased expenses, have to start layoffs of public workers, which will put police, firefighters, teachers, and home health aides out of work, the quickly mounting damage will become irreparable.
The nation needs action now. Winter is coming, for the economy and for the people, and they must have government aid to shelter them. The refusal of Republicans to negotiate seriously toward providing that aid is a mistake on every level.