Dozens of Democratic senators are urging Senate leaders to extend two unemployment insurance programs set to expire at the end of the year — a looming cliff which experts say could push many Americans into poverty and slow the economic recovery.
Sen. Mark Warner (D., Virg.) and Sen. Ron Wyden (D., Ore.), along with 30 other senators, wrote a letter to Senate leaders urging them to extend the programs in the next round of COVID-19 relief — though negotiations have been stalled since before the election.
The Pandemic Unemployment Assistance (PUA) program and the Pandemic Emergency Unemployment Compensation (PEUC) program — which makes gig workers, contractors and other workers eligible for jobless benefits and provides and an extra 13 weeks of benefits, respectively — will expire at the end of the year if Congress does not act. If the programs expire, about 12 million people could lose unemployment aid.
“As the virus surges going into the winter months, the loss of benefits at this time is particularly cruel,” the senators wrote in the letter to Majority Leader Mitch McConnell (R., Ken.) and Minority Leader Chuck Schumer (D., N.Y.). “For many, the knowledge of this benefits cliff will hang over them while they celebrate Christmas morning, share a meal for Christmas dinner, or observe other holidays with their families in the middle of what has already been a difficult and tragic year.”
In the letter, the senators said Congress should extend the programs and include additional weeks of eligibly for workers as the pandemic drags on and laid off workers exhaust their benefits.
“We know that this virus has hit certain industries and sectors harder than others, particularly in the service sector and in the arts. Many workers need additional weeks of eligibility in these programs because demand for their services or industry has cratered during the pandemic,” wrote the senators.
Looking beyond the pandemic, the senators noted the need for a “dramatic update and reform” to the U.S. unemployment insurance system.
“Congress created the PUA and PEUC programs with the knowledge that our regular unemployment program is part of a patchwork system of worker benefits, inadequate for covering a nation facing an emergency public health crisis. The patchwork nature of American benefits does not disappear at the end of this crisis,” said the senators. “Our social safety net should not require an Act of Congress to serve the American public well in the face of a disaster.”
New bill to extend UI programs, bring back $600 weekly boost
Also on Tuesday, Wyden, Sen. Sherrod Brown (D., Ohio) and Sen. Michael Bennet (D., Colo.), Sen. Jack Reed (D., R.I.) — who all signed the letter — and Minority Leader Schumer unveiled bill (separate from the letter signed by Democrats) that would extend the programs and bring back the $600 weekly boost in jobless benefits that expired earlier this year.
“The economic abyss comes at an increasingly desperate time,” said Wyden, pointing to the recent COVID-19 surge. “We just believe it’s unacceptable to stay down the path we’re on — putting families in the position of making these horrendous choices of putting food on the table or paying for necessities like rent.”
The American Worker Holiday Relief Act would tie PUA and PEUC to current economic conditions. The programs would stay in place in every state until the three-month average national unemployment rate falls below 5.5%, and the programs would stay available in some states where unemployment remains high. (The October unemployment rate was 6.9%.)
The bill would increase base number of weeks of PEUC from 13 to 39. An additional 13 weeks of benefits would be added for each percentage point a state’s unemployment rate rises above 5.5%.
Fifty-two weeks of PEUC would be available when a state’s three-month average total unemployment rate is above 6.5%, 65 when the rate is above 7.5%, and 78 when the rate is above 8.5%.
The senators argue the bill would make sure future gridlock in Congress does not stand in the way of relief for unemployed workers.
“It’s an attempt to move away from artificial cliffs that don't give the American people the predictability they need,” said Bennet in a call with reporters.
“From the perspective of people in Colorado no amount of dysfunction in Washington, D.C., is an answer to what they need us to do — which is to act on their behalf, to help them feed their families during this incredibly difficult time and to help save their small businesses,” he added.
Separately on Tuesday, a group of Republican and Democratic lawmakers unveiled a $908 billion stimulus plan, which includes aid for states and local governments, small business relief and additional unemployment insurance.
Yahoo Finance reached out to McConnell’s office for comment.
Jessica Smith is a reporter for Yahoo Finance based in Washington, D.C. Follow her on Twitter at @JessicaASmith8.