The Trump administration opposes a Democratic proposal to extend a $600 per week federal unemployment benefit approved in response to the coronavirus pandemic, Labor Secretary Eugene Scalia said Tuesday.
The $600 payment, which is in addition to normal unemployment benefits, “was the right thing to do,” Scalia said, but is no longer needed as the economy begins to recover.
The government relief package enacted in late March came as the unemployment rate surged due to shutdown measures.
The payments are set to expire July 31, and Democrats have pushed a plan that would extend the enhanced benefit through January.
The Democrat-led House approved the proposal last month, but it is considered unlikely to advance in the Republican-controlled Senate.
Scalia pointed to a promising employment report released last Friday that revealed 2.5 millions jobs added in May.
By the end of July, “we expect the economy to be deep into the process of reopening, with shutdown orders ended and millions of Americans freed to return to work,” he told the Senate Finance Committee.
By August, “the circumstances that originally called for the $600 plus-up will have changed,” Scalia said. “Policy will need to change as well.”
Democrats challenged that view, saying the unemployment rate is likely to remain at historically high levels through the summer at least.
Friday’s jobs report showed that unemployment dropped in May as reopened businesses began recalling millions of workers faster than economists had predicted.
Republican Sen. Chuck Grassley of Iowa, the Finance Committee chairman, said the $600 weekly payments were “poorly targeted,” resulting in most recipients being paid more on unemployment insurance than they earned when they were working.
“This discourages people from returning to work or taking a new job, delaying the recovery,” Grassley said.
Grassley and other Republicans cited a report by the Congressional Budget Office indicating that extending the $600 payments through January would mean that about 5 of every 6 recipients would receive benefits higher than the amount they would have earned from working.
Grassley said he hears from Iowans every day who wonder why they are earning less than others they know who are getting unemployment benefits. Employers also have complained that the generous benefits are resulting in fewer applicants for job openings, he said.
Democratic Sen. Ron Wyden of Oregon called that evidence anecdotal and said the idea that Americans don’t want to go back to work “is dead wrong and insulting.”
Scalia said he agrees that most Americans “are excited to go back to work,” but added that “at the margins, a certain number will choose not to work” because of the $600 payments.
Democratic Sen. Sherrod Brown of Ohio said the fact that those collecting the additional $600 per week receive more than their usual pay only shows that “they were underpaid before.” He pushed a plan to raise the minimum wage to $15 an hour, a move Scalia resisted.
The Western Journal has reviewed this Associated Press story and may have altered it prior to publication to ensure that it meets our editorial standards.
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