Senator Schumer is upping his own demands on unemployment benefits

Yesterday, Senate Minority Leader Chuck Schumer (D-NY) said the following on the Senate floor regarding ongoing negotiations on extending the $600 federal unemployment benefit bonus:

On unemployment insurance, a few Senate Republicans have belatedly accepted the view we should extend the enhanced benefit of $600 for an extended period of time, as Democrats have proposed and voted for in the House. Of course, many Senate Republicans–most Senate Republicans–still object to that, but at least a few have come around. At the moment, however, the White House is not there, and we are not going to strike a deal unless we extend the unemployment benefits, which have kept nearly 12 million Americans out of poverty.

CNBC described the current state of play this way: “Though the White House reportedly offered to extend the federal benefit at $400 per week into December, Senate Minority Leader Chuck Schumer, D-N.Y., signaled Wednesday that he would only accept a deal that continues the $600 payments.” Schumer reiterated that today, saying simply “We’re with the $600.”

Senator Schumer’s insistence on continuing the full $600 bonus will come as something of a surprise to those paying close attention to what Senator Schumer himself recently proposed in legislation. As I noted last month, Schumer — along with Senator Ron Wyden (D-OR), the lead Democrat on the Senate Finance Committee with jurisdiction over unemployment benefits — proposed a detailed plan on July 1 to extend bonuses past their July expiration. But that plan specifically called for less than $600 bonuses, depending on individual state unemployment rates.

Here’s what the summary of the Schumer-Wyden July 1 proposal said:

After July 31, 2020, the Federal Pandemic Unemployment Compensation (FPUC) benefit amount will remain at $600 for all weeks until a state’s three-month average total unemployment rate falls below 11%. Once the unemployment rate falls below 11%, the benefit amount reduces by $100 for each percentage point decrease in a state’s unemployment rate.

Specifically:

· While a state’s unemployment rate is at least 10% and below 11%, the FPUC benefit is $500. 

· While a state’s unemployment rate is at least 9% and below 10%, the FPUC benefit is $400.

· While a state’s unemployment rate is at least 8% and below 9%, the FPUC benefit is $300. 

· While a state’s unemployment rate is at least 7% and below 8%, the FPUC benefit is $200. 

· While a state’s unemployment rate is at least 6% and below 7%, the FPUC benefit is $100.

How big would current bonuses be under the Schumer-Wyden plan? A review of relevant Department of Labor data suggests unemployed workers in 30 states would currently be eligible for $600 per week bonuses under their plan. But in 23 other states* (AL, AZ, KY, AR, CT, DC, GA, IA, KS, MD, MN, MO, MT, NM, SD, VA, ID, ME, ND, PR, UT, WY, and NE) bonuses would be less than $600 (three states would qualify for $500 bonuses, 13 for $400 bonuses, six for $300 bonuses, and one for $100 bonuses; no state’s unemployment rate is currently in the range to qualify for either a $200 bonus or no bonus).

Importantly, those figures are based on states’ “three-month average total unemployment rates,” as the July proposal described. That current three-month average includes the months of April (14.7 percent unemployment nationally), May (13.3 percent), and June (11.1 percent), which were the three highest months of unemployment in recorded US history. Tomorrow, the Department of Labor will release national unemployment rate figures for July, followed in a few weeks by state averages for July. If those state averages for July don’t match or exceed April levels (which marked the worst month of unemployment in recorded US history), then states’ three-month averages will decline. That means the number of states where unemployed Americans would collect less than $600 per week under the Schumer-Wyden plan would grow compared with current levels described above.

The bottom line is that, at the moment when the metric used to
distribute bonuses under the July Schumer-Wyden plan is likely at its most
generous, already 23 states would qualify for less than $600 bonuses. And the
number of states where less than $600 bonuses would be paid under that plan is
highly likely to grow in the weeks ahead. All of which sounds very different from
Senator Schumer’s current insistence that “we should extend the enhanced
benefit of $600” everywhere.

* The unemployment insurance system includes 50 states and three jurisdictions (DC, Puerto Rico, and the US Virgin Islands).

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