Biden open to extending federal unemployment bump: Psaki

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Biden open to extending federal unemployment bump: Psaki

President Biden is open to extending a $300 weekly unemployment insurance supplement that businesses say caused a labor shortage, but he hasn’t yet made up his mind, White House Press Secretary Jen Psaki said Friday.

The supplement, set to expire the first week of September, has given low-wage workers a disincentive to return to work, critics say.

“At this point they’re expiring at the beginning of September. Nothing has changed on that front. But a final decision has not been made,” Psaki said at her daily press briefing.

Psaki said “he hasn’t made a decision to extend it, he also hasn’t made a decision not to.”

Psaki rejected a reporter’s suggestion that a surprisingly strong monthly jobs-growth report released Friday was the result of 26 states including Texas, Florida, Ohio and Georgia cutting off the enhanced unemployment benefits early.

“We don’t see any evidence in the available data that some states ending unemployment benefits early had any impact on today’s incredibly strong numbers,” Psaki said.

“We are seeing strength across the economy across states and regions of course. But that’s thanks to a number of investments that have helped get people through this difficult time and get them back to work.”

President Joe Biden
President Joe Biden says he’s unsure of extending the $300 unemployment supplement by September.
Yuri Gripas / Pool via CNP

Psaki said that widespread vaccination against COVID-19 is the reason for the economic rebound, which featured 943,000 new jobs in July, exceeding expectations and dropping the unemployment rate to 5.4 percent.

A $1.9 trillion COVID-19 stimulus bill that passed Congress in March without a single Republican vote set up the current $300 weekly supplement, continuing the $300 supplement signed into law in December by former President Donald Trump.

Left-wing lawmakers, fresh off a victory this week in persuading Biden to extend an evictions moratorium, are expected to pressure Biden to extend the more generous unemployment benefits.

 In this file photo taken on May 28, 2021, a 'Help Wanted' sign is postedat a restaurant in Los Angeles, California.
White House Press Secretary Jen Psaki insists increased nationwide hiring was a result of states ending unemployment benefits.
AFP via Getty Images

The idea of pandemic unemployment assistance started with broad bipartisan support last year. As COVID-19 lockdowns triggered widespread unemployment in March 2020, Congress approved with almost no opposition a more than $2 trillion bill that offered a $600 weekly unemployment supplement, which in some states resulted in workers earning more from unemployment aid than from their former jobs.

But Congress then gridlocked on the benefit and it was allowed to expire in summer 2020 — before Trump signed an executive order in August 2020 to create a new $400 weekly supplement with unused funds. At the same time, Trump set up an evictions moratorium, which courts later ruled against, but which Biden partially extended this week despite the protests of landlords.

An approximately $1 trillion bipartisan infrastructure bill that’s expected to pass the Senate this weekend does not touch the unemployment benefits, but they might be included in a larger single-party bill that Democrats hope to ram through Congress without Republicans using special budget reconciliation rules.

Psaki on Friday disputed a Congressional Budget Office assessment that the bipartisan bill would add $256 billion to the federal deficit over 10 years. Psaki said the CBO “does not count for savings agreed to on a bipartisan basis — that includes over $200 billion in lower costs for emergency programs like paid leave over the last year… and over $60 billion in higher spectrum revenue from a February auction… [or] the positive effects of the economic growth this package will drive.”

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