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US Congress Running Out of Time to Address COVID-19 Economic Impact

People walk past a business that is closing following the outbreak of COVID-19 in the Manhattan borough, New York, Aug. 17, 2020.

Millions of Americans are unemployed this holiday season due to the closures brought on by the coronavirus pandemic. Millions more are facing economic uncertainty and concerns about access to testing and health care resources.

But as the holiday season begins amid surging numbers of infections, that reality has not broken the monthslong political deadlock on Capitol Hill over addressing the financial impact of the pandemic.

According to unemployment numbers released Wednesday, more than 770,000 people filed new claims last week. While that number is not close to the record high reached earlier this year at the beginning of the pandemic, it does mark the second week of rising unemployment numbers.

U.S. lawmakers from both parties agree the American people need a new round of aid to address unemployment, food insecurity and access to health care. But this Thanksgiving week, lawmakers are back in their home districts, and food banks in the nation’s capital are facing record demand.

Lining up for food

“Pre-pandemic, we had 400,000 individuals. It's now closer to 600,000 food-insecure individuals. So, in eight months, that number has gone up by just about 60%,” said Radha Muthiah, president and CEO of Washington, D.C.-based Capital Area Food Bank.

“We see working families and individuals who were able to live and make it paycheck to paycheck before, and they had multiple jobs in their household. But now, when one or two or more of those jobs are no longer available, and they find themselves unemployed on all fronts, they're navigating an emergency food assistance network that they never had to before,” said Muthiah.

A September 2020 Pew Research Center study found that one in six Americans had borrowed money from a family member or used a food bank since the beginning of the pandemic. The study also found that 25% of U.S. adults say they or someone in their household lost their job or was temporarily laid off because of the closures brought on by the pandemic.

Cars line-up as the Los Angeles Regional Food Bank distributes food outside a church during the outbreak of COVID-19 in Los Angeles, California, Nov. 19, 2020.
Cars line-up as the Los Angeles Regional Food Bank distributes food outside a church during the outbreak of COVID-19 in Los Angeles, California, Nov. 19, 2020.

Programs ending

Without a deal on a new round of aid, two key programs are set to lapse December 26.

According to an analysis by The Century Foundation think tank, 7.3 million people will lose their benefits when the Pandemic Unemployment Assistance (PUA) program expires, and 4.6 million will lose their benefits when the Pandemic Emergency Unemployment Compensation (PEUC) program lapses at the end of the year.

Student debt relief and a national eviction moratorium are also set to expire at year’s end. The lapse in eviction relief is estimated to impact as many as 30 million people, according to an analysis by The Aspen Institute.

One-time stimulus check

The $2.2 trillion CARES Act, the largest aid package in U.S. history, which was passed by lawmakers in late March, also distributed checks of as much as $1,200 to many Americans.

“Those stimulus checks were necessary and had immediate impact for these families,” said Muthiah. “We hear that from our clients at the distribution centers that we have, or at apartment (drop-offs) every day. They can tell you stories of how they have to pay rent, or one person is not working any longer. Those checks were lifesavers for so many — both the stimulus check, as well as the additional unemployment insurance.”

According to an October 2020 study conducted by the Columbia University Center on Poverty and Social Policy, the CARES Act offset potential increases in poverty in April and May. However, poverty rates increased again in August and September after the expiration of the enhanced unemployment benefits program.

“The CARES Act’s stimulus checks and unemployment benefits lifted more than 18 million individuals out of monthly poverty in April, but this number fell to around 4 million individuals in August and September after the expiration of the $600 per week unemployment supplement,” the report found.

Almost immediately after the CARES Act, lawmakers acknowledged it would likely not be enough to address the economic and public health crises brought on by the pandemic.

Congressional impasse

The Democrat-majority House of Representatives has passed two proposals in recent months — the $3 trillion HEROES Act and another $2.2 trillion proposal in October. There are two proposals in the Republican-majority Senate that have not yet passed — the $1 trillion HEALS Act and the so-called “skinny” proposal that totals $500 billion.

But the politics of election season did little to incentivize either side to make a deal. Republicans have warned against indiscriminate and unchecked spending to address the problem, while Democrats have argued they cannot settle for a lower number when so much is at stake.

“We are in a full-blown economic and health catastrophe, and it is amazing to see the patience the GOP has for other people's suffering,” House Speaker Nancy Pelosi said in a press conference last week.

In a November 17 joint letter to Senate Majority Leader Mitch McConnell, Pelosi and Senate Minority Leader Chuck Schumer noted they had agreed to the lower number of $1.2 trillion in aid earlier this summer while engaged in negotiations with Treasury Secretary Steve Mnuchin and White House Chief of Staff Mark Meadows. But the Democratic leadership said McConnell’s “skinny” number of $500 billion was too low.

Senate Majority Leader Mitch McConnell, R-Ky., flanked by Sen. John Thune, R-S.D., left, and Sen. Todd Young, R-Ind., talks to reporters on Capitol Hill in Washington, Nov. 17, 2020.
Senate Majority Leader Mitch McConnell, R-Ky., flanked by Sen. John Thune, R-S.D., left, and Sen. Todd Young, R-Ind., talks to reporters on Capitol Hill in Washington, Nov. 17, 2020.

McConnell responded last week, saying, “Senate Republicans have voted multiple times to send hundreds of billions of dollars for schools, small businesses, health care, and laid-off workers. If Speaker Pelosi and Leader Schumer had not made the calculation to block it, that money could have been out the door many weeks ago. Instead, our Democratic colleagues have spent months holding all of that urgent help hostage over unrelated left-wing wish-list items.”

When the Senate and House return to Washington following a holiday break on Monday, lawmakers will have just 15 days left in session this year and a packed legislative schedule. They are facing a battle over renaming military bases named for Confederate generals and a December 11 expiration of government funding.

Surging coronavirus cases

Even with several promising vaccine candidates poised for distribution in the new year, Americans are still facing a grim winter.

The United States reached 12.4 million confirmed COVID-19 infections this week and more than 250,000 deaths, according to statistics from the Johns Hopkins Coronavirus Resource Center. The United States has also been facing daily high numbers of cases in recent days, with the number of infections expected to surge as people travel for the Thanksgiving holiday.

Muthiah said the economic impact of the pandemic will be long-lasting.

“The need is not likely to disappear in the next three or four months. We've seen this need continuing easily for 12 to 24 months,” she said.