U.S. unemployment benefit cut pushes millions into financial chasm

(Reuters) – When the US Congress passed a pandemic aid bill on Monday, Meghan Meyer, a single mother from Lincoln, Nebraska, thought she would get a truce in the daily struggle to feed and house her two children during a period of unprecedented health and economic crisis.

ARCHIVE PHOTO: Volunteers from the Forgotten Harvest food bank sort and separate different products before a mobile distribution of the pantry before Christmas, amid the coronavirus disease pandemic (COVID-19) in Warren, Michigan, USA, December 21, 2020. REUTERS / Emily Elconin

But the next day, President Donald Trump declared the long-awaited aid package “a shame” and said he would not sanction it, condemning some of his spending measures while demanding that they include greater stimulus checks for the majority of Americans.

Over the weekend, he refused to budge.

That leaves Meyer, who has been on unpaid sick leave from her customer service job at retailer TJ Maxx since May, because she is at risk of serious COVID, facing a financial chasm. She is one of about 14 million Americans whose emergency unemployment benefits, introduced by Congress when the pandemic spread in March, ended on Saturday.

“I don’t know what I’m going to do,” Meyer, 39, told Reuters in a telephone interview. To survive until 2020, Meyer said he had to rely on friends and charities to help put food on the table, pay the rent, cover the family dog’s medical expenses and buy Christmas gifts for his children.

“I resisted and resisted,” she said.

The new relief bill would extend through mid-March programs that support self-employed and unemployed workers for more than half a year. It also gives an additional $ 300 a week through mid-March to all those receiving unemployment insurance, about 20.3 million people. And until January, a moratorium on evictions that will expire on December 31 and provides $ 25 billion in emergency rental assistance.

Many economists agree that aid is insufficient and more will be needed after Democratic President-elect Joe Biden takes office on January 20. Biden called the project “entry”.

Negotiated by Trump’s own Treasury Secretary Steven Mnuchin and Republican Party congressional leaders, the project was sent to the President’s Florida beach resort, where he is staying for the holiday, awaiting his possible signature. In tweets on Saturday, Trump signaled that he was not yet ready to sign the law, despite calls from lawmakers to show goodwill at Christmas time.

“I just want to give our big people $ 2,000 instead of the miserable $ 600,” he tweeted on Saturday, referring to the bill’s stimulus checks, while he also continued to criticize the November election while made unsubstantiated claims about electoral fraud.

Trump did not criticize the terms of the aid package before being voted on in the House of Representatives and the Senate.

While pandemic blocks hit the economy in March, Congress was quick to approve emergency unemployment benefits as part of the $ 2 trillion CARES Act. At the time, lawmakers did not anticipate that aid would be needed after Christmas and, until the last weekend, it was not possible to reach an agreement to extend the benefits.

Meyer, like others, has seen her benefits wane in the past six months after a CARES program that gave her $ 600 a week in supplemental unemployment insurance payments expired in July and she ended up exhausting her Pandemic Emergency Unemployment Compensation allowance .

That left her with extended benefits of just $ 154 a week through Saturday, which would increase to $ 454 if Trump gives in and signs the bill. Otherwise, Meyer will receive nothing.

“It’s the difference between having enough food or not, if I can pay for my car insurance, if I can have gas to go to a food bank,” she said.

Meyer said she voted for Trump in 2016, but was quickly dismissed for her behavior in office and described her opposition to the aid package as “petty”.

‘SQUEEZE’ IN GROWTH

Employment growth in the U.S. slowed after an initial recovery, when requests to stay at home were suspended over the summer, and a new wave of coronavirus infections now threatens to hamper the recovery.

Andrew Stettner, a senior member of the non-partisan think tank The Century Foundation, said delaying relief will delay recovery, even if most Americans are vaccinated and life returns to normal in 2021.

“If you don’t have that money circulating in the economy, it will tighten things up,” said Stettner.

Like Meyer, most people who are no longer entitled to federal unemployment insurance will be left with no income, as most states offer little assistance, he said.

About 9 million Americans who would not normally qualify for unemployment insurance, including self-employed and temporary workers, were receiving Pandemic Unemployment Assistance (PUA) until it expired along with other CARES programs on Saturday, Stettner said.

Among them is artist Marji Rawson, 54, of Ann Arbor, Michigan, who in a normal year would run a booth at art festivals across the country. These festivals may not return until June, but Rawson from Saturday will lose about $ 150 a week in the PUA, on which she depended during the pandemic.

“As if this world is no longer filled with anxiety, now we have it on top of it,” said Rawson.

Simon Lewis reporting; Editing by Mary Milliken, Michelle Price and Leslie Adler

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