McConnell vows to exclude expanded unemployment benefits from next relief bill

As part of the $2.2 trillion CARES Act passed in March, Democrats negotiated a provision that granted an extra $600 per week on top of state benefit amounts for those who filed for unemployment compensation amid the coronavirus pandemic.

That provision is set to expire in August, but Democrats have already sought to extend it through at least the end of 2020. Senate Majority Leader Mitch McConnell (R-KY) made it clear on Wednesday, however, that the extra unemployment funds “will not be in the next bill” passed by Congress, The Hill reported.

McConnell says no

That vow from McConnell came during a conference call the Senate leader held on Wednesday with House Republicans to discuss an eventual additional relief bill in response to the coronavirus crisis.

McConnell was said to have reiterated his commitment to allowing time for a “pause” designed to let prior relief measures take effect before considering and entering into negotiations on a new round of stimulus, CNBC reported.

In reference to the extra funds for unemployment compensation, which House Democrats have already included in their $3 trillion “dead on arrival” relief legislation, McConnell said that Senate Republicans would have to “clean up the Democrats’ crazy policy that is paying people more to remain unemployed than they would earn if they went back to work.”

“This will not be in the next bill,” the Republican leader reportedly added.

Disincentivizing work

The Washington Examiner reported that McConnell’s promise to end the provision adding an extra $600 on top of what an unemployed worker was already eligible to receive could end up stalling progress on the next relief package, but the paper also noted that there were data and evidence to support the idea that the extra funds are actually doing more economic harm than good.

According to researchers from the University of Chicago, “68% of unemployed workers who are eligible for [unemployment compensation] will receive benefits which exceed lost earnings.”

In other words, many unemployed workers are actually “earning” more by staying at home and not working than if they were to return to their prior job once their workplaces reopened, a real and perverse sort of disincentive that prolongs their time out of work and further delays the economic recovery.

“That is a recipe for people not working,” Sen. Bill Cassidy (R-LA) told reporters, according to the Examiner. “Now, we are paying them more not to work than to work,” he said, and added, “It’s terrible for the recovery.”

Time to get back to work

To be sure, Democrats and liberal economists who are pushing for a continuation of the extra funds for the unemployed — at least through the end of 2020, if not into the middle of 2021 — will cry foul and accuse Republicans of being heartless and uncaring toward the average American worker.

But that is standard fare and nothing new, and it will be far better in the long run for this nation and its economy if workers are encouraged to return to their jobs or seek out new ones rather than continuing to make it more comfortable and even more profitable for them to remain unemployed for an extended period of time.

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