Democrats have to pass Biden’s agenda or the US won’t get back to pre-crisis prosperity, Oxford Economics says

Joe Biden Chuck Schumer
President Joe Biden and Senate Majority Leader Chuck Schumer.

  • Passing Democrats’ spending plan is the difference between a stellar and a subpar recovery, according to Oxford Economics.
  • Failure to do so would slash economic growth and delay a full labor-market rebound, the firm says.
  • Democrats aim to pass a measure in September, but key disagreements risk killing the plan altogether.
  • See more stories on Insider’s business page.

Passing Democrats’ latest spending plan could mean the difference between a stellar economic rebound and a subpar recovery that lasts for years, experts at Oxford Economics said Wednesday.

Congressional Democrats are currently pushing forward with plans to pass President Joe Biden’s sweeping infrastructure proposal. Details around the plan – which includes $3.5 trillion in spending – have slowly emerged as House committees finalize their portions of the bill. But as Democrats near their September deadline for passing the plan, disagreement over key elements such as the child tax credit and the price tag threaten to delay a vote.

It might be better for Democrats to move forward with a smaller package, as failing to pass new spending would seriously hamper the US recovery, economists Nancy Vanden Houten and Gregory Daco of Oxford Economics said in a note. The team expects Democrats to shrink the latest spending proposal to $2.5 trillion before passing it through budget reconciliation. If lawmakers fumble efforts to pass the smaller measure with the $550 billion bipartisan infrastructure plan, the recovery will suffer for years, the economists said.

Chart via Oxford Economics.

For one, the US economy won’t grow nearly as fast. Failure to pass the bills would cut 2022 growth to 3.7% from 4.4%, Oxford Economics said. Growth in 2023 would slide by 1.4% from 2.6%.

It would also drag on the labor market’s rebound. A lack of new spending would lead to 1.2 million fewer jobs being created, according to the team. The unemployment rate would only fall to 4.2% through 2023, instead of 3.5% in the firm’s baseline scenario that sees both measures passing.

More broadly, botching both plans’ passages would leave the country struggling to return to its pre-pandemic economic health. Passing both packages would help US gross domestic product outpace its pre-crisis trend early next year, according to Oxford Economics’ forecasts. That would mark a substantial victory over the pandemic after nearly two years of harsh economic pain.

Conversely, a dearth of fresh stimulus dooms the country to a substandard recovery. Gross domestic product growth would retake its pre-crisis trend in 2022 but quickly slow and remain below the critical level well into 2023, the economists said.

Approving both bills, then, can determine whether the country ever returns to its pre-COVID welfare.

“September will be a pivotal month for the trajectory of US fiscal policy and President Biden’s domestic policy agenda,” the team said. Failure to pass the spending packages would drag on the economy just as other fiscal boosts are set to fade, they added.

Oxford Economics’ latest forecast comes after several banks slashed their own outlooks for the recovery ahead. Bank of America and Goldman Sachs nearly halved their GDP estimates in August, blaming the Delta wave and weaker spending for the gloomier projections.

JPMorgan followed on Wednesday, cutting its third-quarter growth forecast to 5% from 7%. While some of the lost growth will show up in the fourth quarter, much is permanently lost to supply-chain issues and weak demand, Michael Feroli, chief US economist at JPMorgan, said in a note.

With Delta case counts climbing higher through September, the US recovery is on the ropes. Democrats’ efforts to pass trillions of dollars in new spending could decide whether the rebound accelerates or runs out of steam.

Read the original article on Business Insider

Sen. Joe Manchin doubles down on requiring parents to work for the Biden child tax credit

Joe Manchin
Senator Joe Manchin of West Virginia.

  • Sen. Joe Manchin dug in on his proposal to require people work for the Biden child tax credit.
  • “Tax credits are based around people that have tax liabilities,” Manchin told Insider.
  • Early research indicates that it helped cut hunger among families, including those in Manchin’s state of West Virginia.
  • See more stories on Insider’s business page.

Sen. Joe Manchin of West Virginia dug in on pushing a new requirement that parents work in order to receive the child tax credit on Tuesday as Democrats struggled to get the $3.5 trillion social spending plan over the finish line.

“They know I feel very strongly about that. Tax credits are based around people that have tax liabilities,” Manchin told Insider on Th. “I’m even willing to go as long as they have a W-2 and showing they’re working, we’ve talked about that.”

It comes two days after Manchin first suggested requiring people to work and file taxes as a condition to get the advance monthly payments. He said in a CNN interview that tying the child tax credit to those with jobs would ensure federal assistance would flow to “the right people.” He maintained he supports child tax credits.

Democrats in the House and Senate, including Sens. Bernie Sanders of Vermont and Sherrod Brown of Ohio, on Monday poured cold water on the idea. Opposition to the idea on Tuesday grew from other Democrats as well. The party is laboring to assemble a party-line package that can garner the support of nearly every Democratic lawmaker.

“Adding a work requirement or other stipulations to the Child Tax Credit would hurt middle-class families,” Rep. Suzan DelBene of Washington, chair of the 95-member moderate New Democrat coalition, said in a statement to Insider. “The Child Tax Credit is an important tax cut for middle-class families and in only two months is already having an incredible impact on American children.”

She added the New Democrat group was “all-in” on extending the benefit.

Meanwhile, Brown told reporters on Tuesday, “I think that raising children is work.”

The Democratic stimulus law in March turned the credit into a one-year cash benefit issued in monthly checks to the vast majority of families. Individuals who earn $75,000 or less are eligible for up to either a $250 or $300 direct payment per child depending on their age. Couples earning a combined $150,000 or less also qualify for the total check amount.

House Democrats are pushing to extend the revamped credit until 2025, and ensuring that low-income families who don’t have to file taxes can permanently get the benefit. The current child allowance does not require individuals to have a job to obtain federal assistance.

But its unclear whether Senate Democrats will extend it with the same length and structure, given early resistance from Manchin.

Early research indicates the first month of payments kept three million children out of poverty and helped feed two million kids in July. Food insecurity dropped among West Virginians families as well, per an analysis last month from the West Virginia Center on Budget and Policy.

Read the original article on Business Insider

Senate Democrats weigh extending Biden’s monthly $300 checks to families to 2024 in $3.5 trillion social spending plan

joe biden
U.S. President Joe Biden pauses while giving remarks on the worsening crisis in Afghanistan from the East Room of the White House August 16, 2021.

  • Senate Democrats are weighing an extension of Biden’s child allowance to 2024 in their massive social spending plan.
  • But some low-income families may be excluded from receiving the full benefit after 2024 due to budgetary constraints.
  • A possible reduction in the plan’s size may further jeopardize its extension.
  • See more stories on Insider’s business page.

Senate Democrats are weighing a three-year extension of President Joe Biden’s revamped child tax credit in the $3.5 trillion social spending plan, per a Senate Democratic aide familiar with the ongoing discussions. But it could be pared back due to the program’s cost and the prospect of Democratic moderates demanding cuts to the size of the package.

The aide spoke on condition of anonymity to share details of private negotiations and stressed it was in flux. The child tax credit would be extended until 2024, and the amount would drop back to $2,000 in a presidential election year. But families who owe little or no taxes would get the full size of the benefit permanently, otherwise known as “full refundability.”

To save $35 billion, Democrats in the upper chamber haven’t ruled out scrapping full refundability for the rest of the decade due to budgetary constraints, though top Democrats like Senate Majority Leader Chuck Schumer and House Speaker Nancy Pelosi want to preserve it.

“Nothing is locked in,” the person said. “The White House is pushing for it. We know Schumer is pushing for it. We definitely know Pelosi is pushing for it. But it’s a money game at this point.”

Congressional committees are in the midst of drafting their parts of the social spending bill. Democrats intend to muscle it through a process requiring only a simple majority known as reconciliation, and bypass what’s likely to be unanimous GOP opposition.

The Senate Finance Committee has been allocated $385 billion to extend the child tax credit, along with another pair of programs like the earned income tax credit and the child and dependent care tax credit, a person familiar told Insider. A three-year extension of the child tax credit alone comes out to $330 billion, per the Joint Committee on Taxation.

The child tax credit provides up to $300 monthly payments per child under 17. The Democratic stimulus law in March turned it into a cash benefit for most American families. Individuals earning $75,000 and below are eligible for the full amount, along with couples making $150,000 and under.

It maxes out for individuals at $200,000 and couples at $400,000.

Previously, the program offered low-income families only a portion of the federal aid because they didn’t have to file taxes. Now the vast majority of families can get the $3,000 or $3,600 annual benefit, depending on their child’s age.

Sen. Sherrod Brown of Ohio, an architect of the expansion, is still pushing to extend the child tax credit for as many people as possible. Early research indicates it has lifted three million children out of poverty and slashed hunger.

“The CTC is one of the best tools we have to show people government is on their side and deliver meaningful results that nearly all families with children can feel and see in their everyday lives,” a Brown spokesperson said in a statement to Insider. “Sen. Brown believes we need to keep full refundability and extend the expansion of the credit because this has been the most pro-family program in a generation and is already changing lives.”

Experts argue the credit’s refundability is a critical part of ensuring it delivers the largest benefits to low-income parents.

“It’s the most important piece in terms of reaching the families that need assistance raising their children the most and also in terms of racial equity,” Seth Hanlon, a tax expert at the liberal-leaning Center for American Progress, told Insider. He noted the previous version of the $2,000 tax credit excluded 27 million children – most of whom were Black and Latino – from receiving all the money.

Axios reported on Tuesday that Sen. Joe Manchin of West Virginia may support only a $1.5 trillion party-line package, That would be a significant step down from a $3.5 trillion budget now being debated, but all 50 Democratic senators must band together for the plan to clear the upper chamber.

Manchin and Sen. Kyrsten Sinema of Arizona, another centrist, say they will oppose a package that costs $3.5 trillion, triggering the ire of progressives.

The bulked-up child tax credit is a key Democratic priority, and Biden touted the measure on Wednesday. “Everybody talks about my child tax credit; it is a tax cut for ordinary folks,” he said at a labor union event at the White House. “That’s what it is.”

Read the original article on Business Insider

NYC is using Biden’s stimulus to support taxi drivers, the homeless, and give artists $5,000 checks

Taxi cabs drive through streets of Manhattan, NYC
  • NYC detailed plans to spend the $5.9 billion it received from Biden’s American Rescue Plan.
  • Those plans include giving artists $5,000 checks, supporting the homeless, and funding taxi drivers.
  • States have been slow to distribute other elements of Biden’s stimulus aid, like rental relief.
  • See more stories on Insider’s business page.

New York City received more aid than any other city in the country from President Joe Biden’s American Rescue Plan. It plans to allocate those stimulus funds to a range of areas, including giving some lucky artists $5,000 and working to end homelessness.

Last week, NYC released a 70-page report detailing its plans to use the $5.9 billion in stimulus funds it received from Biden. Those plans include a program that provides $5,000 grants to 1,800 artists who suffered financially during the pandemic, a $65 million relief fund for taxi medallion owners, and $125 million to support homeless people in the city, among other things.

The report noted that these measures are “just the beginning,” and the city’s top priority remains getting every resident vaccinated for COVID-19, and the detailed plans only include those that are funded from Biden’s stimulus.

“It is not intended to serve as a comprehensive report on the City’s recovery efforts,” the report said. “The City’s decisions to invest these funds now will help keep New Yorkers safe, restart the economy, rebuild the tax base, increase equity, and enable greater economic growth in future years.”

Other plans included $1.5 billion to increase employment and support small businesses, and $52.5 million to bring NYC’s tourism back to pre-pandemic levels.

Insider reported in March that after Biden signed his stimulus plan into law, of the $350 billion in state and local aid, $22.5 billion of it was divided evenly between all states and the District of Columbia, and the remaining funds were allocated based on unemployment numbers. That meant that New York, along with California and Texas, were on top of the list for that aid.

But since states received stimulus aid, a number of them have been slow to actually get the aid to residents who need it. For example, Insider reported in July that while Biden set aside $50 billion to give to renters facing eviction during the pandemic, only 4% of that aid had gone out because the distribution of that aid was under the control of the states. $8.5 billion for medical care in rural areas also has yet to be spent as the Delta variant surges and COVID-19 cases rise.

NYC plans to allocated $1.45 billion extend its vaccination campaign and improve testing for the virus.

Read the original article on Business Insider

Warren Buffett’s global market indicator hits a record 142%, signaling stocks are too expensive and could crash

warren buffett newspaper
Warren Buffett.

  • The global version of the “Buffett indicator” has reached a record high of 142%.
  • Warren Buffett’s namesake gauge divides the total market cap of global stocks by worldwide GDP.
  • Buffett said the indicator spiking before the dot-com crash was a “very strong warning signal.”
  • See more stories on Insider’s business page.

Warren Buffett’s favorite market indicator has surged to a record high of 142%, signaling US and international stocks are heavily overpriced and could plummet in the months ahead.

The global version of the “Buffett indicator” takes the combined market capitalization of the world’s publicly traded stocks, and divides it by global GDP. A reading north of 100% indicates the global stock market is overvalued relative to the world economy.

“BOOM! Global stocks have gained another $1.6 trillion in market capitalization this week,” Welt market analyst Holger Zschaepitz tweeted on Sunday. “Equities now worth $120.3 trillion, highest in history.”

“Global stock market cap now equal to 142% of world GDP, an all-time high as well,” he added.

Buffett trumpeted his namesake gauge in a Fortune magazine article in 2001. The billionaire boss of Berkshire Hathaway described it as “probably the best single measure of where valuations stand at any given moment.”

Moreover, Buffett said it should have been a “very strong warning signal” when the yardstick skyrocketed during the dot-com bubble. He added that buying stocks at a reading of 70% or 80% would likely be lucrative, but investors would be “playing with fire” when the ratio approaches 200%.

The US stock market is firmly in “fire” territory with a current Buffett indicator reading of 208%. That figure is well above its 187% reading in the second quarter of 2020, when the pandemic was in full swing and GDP was about 15% lower.

However, the Buffett indicator isn’t flawless. For example, it compares the current value of the stock market to past GDP. Governments around the world have also battled the pandemic by ramping up stimulus and shutting down large parts of their economies over the past 18 months, artificially inflating the yardstick’s readings.

Here’s the global version of the Buffett indicator:

Global Buffett Indicator
The global version of the Buffett indicator.

Read the original article on Business Insider

Global stocks rally after weak US jobs report cools concerns about a faster shift in Fed policy

Asian stocks Japan stocks
Stocks have risen sharply in Japan in the last two sessions.

  • Global stocks rose on Monday despite the US jobs recovery slowing sharply in August.
  • Investors think the weak jobs report will cause the Fed to keep up its support for the economy and stocks.
  • Elsewhere, Brent crude oil fell on Monday after Saudi Arabia cut prices to woo Asian buyers.
  • See more stories on Insider’s business page.

Global stocks climbed on Monday after a disappointing US jobs report eased investor concerns that the Federal Reserve might soon cut back its support for the world’s biggest economy.

Asian stocks rallied overnight, with Japanese equities surging, after Prime Minister Yoshihide Suga’s announcement that he will resign sparked hopes that his successor will be liberal with economic stimulus and better handle the coronavirus crisis.

Tokyo’s Topix index rose 1.28% to a 31-year high, while the city’s Nikkei 225 rose 1.83%. China’s CSI 300 stock index rose 1.87% and the Hong Kong Hang Seng climbed 0.9%.

In Europe, the continent-wide Stoxx 600 index rose 0.57% in early trading. The UK’s FTSE 100 rose 0.56%.

US stock and bond markets were closed on Monday for the Labor Day holiday. S&P 500 futures were up 0.19% in European trading, however, after the index closed flat on Friday. Nasdaq 100 futures were 0.28% higher and Dow Jones futures rose 0.2%.

Read more: 7 stocks to buy as ‘massive creative disruption’ produces a world where e-commerce rivals Amazon and Shopify can both thrive, according to a portfolio manager who’s beaten 96% of his peers over the past year

The rise in stocks follows evidence of a slowdown in US job creation in August, as the weak figures are expected to push the Fed to keep up its support for the economy for a while longer.

US nonfarm payrolls – the most closely watched labor market measure – rose by just 235,000 in August from an upwardly revised 1.05 million increase in July. It was the smallest increase in seven months.

“A major miss from the US unemployment reading has had the ironic impact of reducing investor jitters,” Richard Hunter, head of markets at trading platform Interactive Investor, said.

“The Delta [coronavrius] variant, as largely expected, has continued to impact new job openings, particularly in the areas of hospitality and retail.”

Elsewhere in markets, Brent crude oil fell 0.61% to $72.20 a barrel after Saudi Arabia cut oil prices for sales to Asia in an effort to lure in more buyers, Bloomberg reported.

Bitcoin climbed over the weekend to stand at $51,699 on Monday. The biggest cryptocurrency has risen sharply in recent weeks after tumbling to below $30,000 in July, during a broader rally in digital assets.

It is set to be a busy week for markets after traders and investors return from the US Labor Day holiday.

President Joe Biden is expected to make a decision on whether to nominate Fed Chair Jerome Powell for a second term. The European Central Bank will set interest rates on Thursday. And El Salvador’s law that will make bitcoin legal tender is set to come into force on Tuesday.

Read the original article on Business Insider

Almost half of kids in the US lived in poverty for at least 2 full months between 2013 and 2016

black child poverty
44% of children under 18 experienced poverty for at least two consecutive months between 2013 and 2016, according to the US Census Bureau.

  • The US Census found 44% of children experienced poverty for at least 2 months in a row between 2013-2016.
  • Children also had the highest chronic poverty rate in that time frame, at 4.6%.
  • Democrats are pushing to expand the Child Tax Credit beyond December to help fight child poverty.
  • See more stories on Insider’s business page.

Expanding child allowances is becoming a growing part of the conversation in Congress today, and new data from the US Census Bureau that reflected high and continuous poverty rates for children might accelerate that conversation.

The census released a report last week that analyzed poverty in the US from 2013-2016, and it found that 44% of children under 18 experienced poverty for at least two consecutive months during that time. This is known as “episodic poverty,” and that rate is nearly triple the episodic poverty rate for people aged 65 and older, at 15.8%. Adults aged 18-64 also had a lower episodic poverty rate than children at 33.6% in the same time frame.

Episodic poverty across age groups: 2013-2016
Episodic poverty across age groups: 2013-2016.

Not only did children have the highest episodic poverty, the census found, but they also had the highest chronic poverty rate, which describes those in poverty for all months in the 2013-2016 time frame. For children, that rate stood at 4.6%, with adults and seniors at 2.4% and 1.5%, respectively.

Given the high rates of child poverty, in 2017, Colorado Sen. Michael Bennet and Ohio Sen. Sherrod Brown introduced the American Family Act to triple the Child Tax Credit and give families a $300 check for children ages 5 and under, and $250 for each child between 6 and 17.

This provision made it into President Joe Biden’s March stimulus law. The first payments started going out in July and will continue each month through December. Insider’s Madison Hoff reported last week that the first round of payments kept 3 million children out of poverty with the rate dropping from 15.8% in June to 11.9% in July, according to Columbia University researchers. Data from the Census Bureau also showed the checks fed 2 million children in its first month, as Insider’s Juliana Kaplan reported.

Even though the credit is set to end in December, Insider’s Joseph Zeballos-Roig reported that Democrats might seek to expand it to at least 2025, and possibly make it a permanent allowance.

“We’re talking, I keep pushing for permanence, but we’ll see where it goes,” Rep. Rosa DeLauro, the chair of the House Appropriations Committee, told Insider about the expanded child tax credit.

In addition to fighting child poverty, providing additional stimulus checks would also be significant in fighting poverty nationwide. The Economic Security Project found a fourth and fifth stimulus check could keep 12 million more Americans out of poverty, and with universal basic income pilot programs on the rise, recurring payments could become a reality.

Read the original article on Business Insider

Biden’s child allowance helped feed 2 million kids in its first month

grocery store clerk
  • In July, parents across the country received their first monthly payments from the expanded Child Tax Credit.
  • Those payments meant millions of children did not experience hunger and poverty.
  • Democrats want to expand it until at least 2025, with some saying it should be permanent.
  • See more stories on Insider’s business page.

President Joe Biden’s expanded child tax credit didn’t just boost incomes and cut down on poverty – it also helped reduce hunger for millions of kids.

Under the expanded credit, families can receive up to $300 a month for children under 6 years old, or get $250 for children between 6 and 17. Altogether, families can receive up to $3,600 per child under 6, and up to $3,000 per child who is 6 to 17.

In the credit’s first month, the number of households where someone goes hungry fell, as did child poverty. Lower-income Americans used the money to pay off bills, and the credit made up over 1% of disposable personal income. It shows the immediate impact that the monthly payments – and could have for years (or forever) if Democrats get their way.

The Child Tax Credit cut down on poverty and boosted disposable income

A new analysis from the Center on Budget Policy and Priorities looks at data from the Census Bureau’s Household Pulse Survey from the two weeks that end July 5 to the two weeks that end August 16. That period captures the first monthly check from the expanded Child Tax Credit, which was distributed starting July 15.

During that period, 3.3 million fewer adults reported their households didn’t have enough to eat – an almost one-third drop from 10.7 million to 7.4 million. And, among those households, the number of survey-takers who reported that their kids didn’t have enough to eat fell by 2 million.

That period also saw marked decreases in food hardship for Black and Latino households where someone doesn’t get enough food, according to CBPP. The food hardship rate for Black adults with children fell from 20% to 15%, and for Latino adults with children it fell from 21% to 13%.

Insider’s Madison Hoff reported that the credit didn’t just have a drastic impact on child hunger – it also stopped 3 million children from falling below the poverty line. That’s according to research from Columbia University’s Center on Poverty and Social Policy. As Zachary Parolin, one of report’s author noted on Twitter, normally volatile child poverty will “will likely stay low and stable through the end of 2021.” The Census Bureau found that, from 2013 to 2016, children were more likely to stay in poverty longer than adults ages 18 to 64.

And, as Hoff also reported, lower-income households were more likely to use their monthly check to pay down debts. An analysis by economists at Indeed found that, in July, the tax credit made up 1.2% of disposable personal income.

Right now, the expanded tax credit is set to last for just a year, but Democrats want to extend it until at least 2025. Some want to keep the credit – and its benefits for lower-income and hungry children – forever.

“The expanded credit is in place for only one year. We cannot stop now,” several legislators – including Sens. Cory Booker of New Jersey and Sherrod Brown of Ohio, said in a statement on the day of the first payment. “Kids do not grow up in one year or five years. Parents deserve the predictability a permanent expansion would provide as they raise their families.”

Read the original article on Business Insider

Renters have only received 11% of stimulus aid – and the latest eviction ban could end before they get the rest

Protesters outside the California Capitol hold a sign that reads "Evictions=Death."
In this Jan 25, 2021 file photo demonstrators calling for lawmakers and Gov. Gavin Newsom to pass rent forgiveness and stronger eviction protections legislation, gathered in front of the Capitol in Sacramento, Calif.

  • Only 11% of the federal rental aid meant to help tenants pay during the pandemic has been distributed as of July.
  • After Biden extended the eviction ban through July, aid disbursement only increased from $1.5 billion to $1.7 billion.
  • Biden extended the ban an additional 60 days through October, but it risks getting struck down in court.
  • See more stories on Insider’s business page.

December and March stimulus packages gave states a combined $46.5 billion to help tenants as emergency rental assistance. But as of July, they’ve only sent 11% of that aid out.

President Joe Biden first extended the pandemic-era ban on evictions through the end of July to help tenants who were behind on rent. At that time, just over 6% of aid had been dispersed, according to CNBC. Amid pressure from progressives, he further extended the ban in August by an additional 60 days to continue providing relief. But after the first extension, the aid only slightly ramped up, leaving 89% of that stimulus aid still unspent as evictions loom.

The Treasury Department released data on Wednesday reflecting how much emergency rental assistance aid has been distributed as of July 31. Of the $46.5 billion in aid, only $5.1 billion has been distributed so far.

And from June to July, after the first eviction ban extension, distribution of that aid barely picked up. According to the data, $1.5 billion in rental aid went out in June, and in July, disbursement of that aid saw a slight uptick to $1.7 billion. The Treasury noted that in July, that money was largely spent on rent and utilities and went to more than 340,000 households in need of assistance.

Ramping up the pressure on states to disburse funds

Given the slow disbursement of the aid and many tenants still at risk of eviction, Biden extended the eviction ban an additional 60 days on August 3 to allow for more time for the aid to reach households. But even though the federal government oversees the aid, it is up to the states to actually get that aid out the door, which is why the Treasury detailed plans to pressure states to ramp up their efforts.

The department wrote that “too many grantees have yet to demonstrate sufficient progress in getting assistance to struggling tenants and landlords. After September, programs that are unwilling or unable to deliver assistance quickly will be at risk of having their rental assistance funding reallocated to effective programs in other high-need areas.”

The main issue the department noted with disbursing the aid is the backlog in processing applications, and it said that self-attestation, or allowing tenants to verify their own eligibility for aid, can be used to speed up the process.

Even if aid does ramp up, the eviction ban extension might get struck down in court. Biden himself cited a Supreme Court ruling last month – an opinion from Justice Brett Kavanaugh – that said any new extension needed to come from Congress.

“Any call for a moratorium based on the Supreme Court’s recent decision is likely to face obstacles,” Biden said at a news conference.

The eviction ban is back before the Supreme Court this week after a District of Columbia court declined to strike it down last week, suggesting there might be less time than Biden intended to protect tenants from losing their homes.

Read the original article on Business Insider

Biden won’t extend $300 boost to weekly unemployment benefits past September

Joe Biden
President Joe Biden.

  • Janet Yellen and Marty Walsh confirmed Biden’ won’t extend federal unemployment benefits past September.
  • They wrote in a letter that Biden still supports states using stimulus funds to help the unemployed.
  • 26 states, all but one governed by Republicans, moved to end the unemployment boost early.
  • See more stories on Insider’s business page.

As part of his American Rescue Plan, President Joe Biden extended $300 weekly unemployment benefits through September 6. Top officials in his administration confirmed on Thursday that he won’t be extending the benefits any further.

Treasury Secretary Janet Yellen and Labor Secretary Marty Walsh wrote a letter to the chairs of the House and Senate finance committees with an update on where unemployment benefits stand. They wrote that although the weekly benefits have been a “critical lifeline” for millions of unemployed Americans, a further extension of the benefits – which some Democrats have been pushing for – is off the table.

“The temporary $300 boost in benefits will expire on September 6th, as planned,” Yellen and Walsh wrote. “As President Biden has said, the boost was always intended to be temporary and it is appropriate for that benefit boost to expire.”

However, the officials noted that even as the economy is recovering from the pandemic and payrolls are being added to the labor market, unemployed people may still require financial assistance, and the Delta variant could bring economic setback, as well.

That’s why they said the Labor and Treasury Departments will take the following steps to help those are unemployed:

  1. The Treasury is reaffirming that states can use what they received from the $350 billion in stimulus aid to provide additional support for unemployed people beyond the expiration of the benefits;
  2. Labor will communicate with states on how they can best use their “existing UI (unemployment insurance) infrastructure” to support state-funded benefits using stimulus funds;
  3. And Labor is announcing $47 million in new grants to support reemployment services for all Americans.

Yellen and Marsh also wrote the pandemic has exposed “serious problems” in the UI system that requires reform, which is why Biden is asking Congress to consider long-term reform of UI in Senate Democrats’ $3.5 trillion reconciliation bill.

“The President has already laid out his principles for such reform: he believes a 21st century UI system should prevent fraud, promote equitable access, ensure timeliness of benefits, provide adequate support to the unemployed, and automatically expand benefits in a recession,” they wrote.

After a weak April jobs report, 25 GOP-led states – and one governed by a Democrat, Louisiana – moved to end unemployment benefits early for their residents because they believed the benefits disincentivized work. According to an analysis from the left-leaning People’s Policy Project, over 20 million Americans will lose their benefits when the September expiration rolls around.

Insider’s Joseph Zeballos-Roig and Juliana Kaplan reported that the Delta variant has people begging for more benefits, given that the variant could jeopardize the return to work. But even before Yellen and Walsh’s announcement, moderate Democrat Joe Manchin of West Virginia told Insider he would not support a further extension of the benefits in a reconciliation bill, suggesting a slim likelihood of it passing through Congress.

“I’m done with extensions,” he said. “The economy is coming back.”

Read the original article on Business Insider