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‘You’re not thinking about us’: Jobless Texans fret about losing $600 weekly boost from Congress

The enhanced federal unemployment benefit is poised to expire at Friday's end, with Congress gridlocked over extending the payouts.

Dallas resident Emily C. White was near the brink in late April.

She’d been furloughed from her job as a store manager at the beginning of the month and had no savings in her bank account, and rent was due. She’d filed for unemployment, but the money wasn’t coming through. She was forced to arrange a rent payment plan with her apartment complex.

Then in May, her unemployment benefits finally arrived, along with an added weekly $600 stimulus check from the federal government. For the last three months, White, 32, has used that government assistance to get by as COVID-19 wreaks massive unemployment on the country.

But that fragile sense of stability is about to come crashing down.

“I was one of the ones that benefited from getting that $600,” she said, explaining that she had paid all of her bills on time, started making a dent in her credit card debt and stored up savings for three months for the first time in her life.

Congress was poised Friday to let the financial assistance plan for unemployed Americans expire at the day’s end. Lawmakers failed this week to reach a compromise, even over a simple stopgap measure to allow more time to hammer out a longer-term deal.

Democrats rejected the GOP’s bid to extend the benefit but at $200 per week. Republicans blocked Democrats’ efforts, via a sweeping bill, to leave the benefits fully funded. Democrats reportedly turned down the GOP’s offer of a full four-month extension, while the GOP reportedly said no to Democrats’ counteroffer of keeping the $600 per week through March.

Even a short lapse would mean that in Texas, because of a quirk in state law, the expiration would be retroactive to July 25.

The showdown could persist much longer, in part because some Republicans and business groups have expressed concern that the enhanced benefits have encouraged people to stay home by paying them more than they would earn on the job.

For White, who was told in June that her job at Paddywax Candle Bar would not return, and others, the gridlock threatens their livelihood.

Treasury Secretary Steven Mnuchin (left) and President Donald Trump's chief of staff, Mark Meadows, (beside Mnuchin) entered House Speaker Nancy Pelosi's office this week for a meeting on the next round of coronavirus relief.
Treasury Secretary Steven Mnuchin (left) and President Donald Trump's chief of staff, Mark Meadows, (beside Mnuchin) entered House Speaker Nancy Pelosi's office this week for a meeting on the next round of coronavirus relief.(Andrew Harnik)

The coronavirus pandemic has inflicted nearly unprecedented economic pain, particularly now that re-opening efforts in Texas and other states have been stymied by a surge in COVID-19 cases and deaths. More than 1.8 million Texans remain unemployed.

Early on, Congress sought to cushion the blow.

Lawmakers, as part of a massive relief bill, in late March approved the $600 per week federal unemployment payout to go on top of whatever benefits out-of-work Americans get at the state level. The move succeeded — by some accounts, too well.

Some workers have simply decided to stay away from work, in part because they’ve been able to earn more through unemployment than they would have on the job.

Emily Williams Knight, CEO of the Texas Restaurant Association, said she’s heard from countless restaurant operators in the Dallas area and beyond that are struggling because they “don’t have enough staff — they cannot find enough people to work.”

While the enhanced unemployment benefits aren’t the only thing driving the labor shortage, they are a factor, she said.

So while she opposed letting the federal payouts expire — saying that would do only more damage to employers, employees and the economy — her association is urging lawmakers to come up with a plan that would phase them out while also incentivizing a return to work.

The Bipartisan Policy Center, a Washington-based think tank, found a similar dynamic when it recently polled 1,500 Americans who were receiving unemployment benefits.

Some 16% cited a working wage that was lower than their benefits as a reason they haven’t returned to the job. But the survey found that other things, such as health concerns or difficulty finding childcare, ranked much higher.

Those results are backed up by research from Yale University economists who used weekly data from Homebase, a timesheet software used by many small businesses, to examine whether the enhanced federal payouts were indeed discouraging workers from clocking in.

Their study showed that workers who received larger increases in unemployment benefits returned to the job by early May at a rate similar to the rate for people with less generous benefits.

“The data do not show a relationship between benefit generosity and employment paths,” said Joseph Altonji, one of the report’s co-authors. He said the overriding factor could be the “collapse of labor demand during the COVID-19 crisis.”

White says her job searches have been “futile” — she’s only gotten to the interview segment of an application in three months of trying. The jobs either pay considerably less than the $20 per hour she was making as a store manager, or they are public-facing, which means she’d risk exposure to the virus every day.

If the stimulus goes away, she said, she’ll be forced to choose between a job and her health.

“You’re not thinking about us,” she said of Congress. “You’re thinking about yourselves.”

Sen. Ted Cruz, R-Texas, has cautioned Republicans over the rising price tag of Congress' coronavirus relief packages.
Sen. Ted Cruz, R-Texas, has cautioned Republicans over the rising price tag of Congress' coronavirus relief packages.(Greg Nash)

The reality is that the pandemic has crushed the U.S. economy, even after stay-at-home orders and other restrictions designed to limit the outbreak’s spread have started to lift. There simply aren’t enough available jobs for everyone who wants or needs one.

That means other considerations come into play.

Houston billionaire Tilman Fertitta is a major GOP donor who owns Landry’s, a restaurant empire that includes Joe’s Crab Shack, Rainforest Café and Saltgrass Steak House, along with ventures such as the Golden Nugget Casino in Las Vegas.

He recently told CNBC that maybe 100 of his 50,000 employees are “taking advantage of us” by not coming back to work because of the unemployment benefits. Meanwhile, he said, the extra $600 per week has acted as a “true stimulus.”

Fertitta explained that the enhanced benefits have allowed many Americans to spend money — which they otherwise wouldn’t have had — at “all these retail stores, all these restaurants, any business out there, even automotive and home repair.”

If “you take this $600 out of these 25 million people’s hands … you’re going to see this economy go backwards,” he said.

If that happens, families already struggling with unemployment during the economic shutdown will go deeper into the red, said Jonathan Lewis, a senior policy analyst for the left-leaning Austin think tank Every Texan.

“We’re talking about maxed out credit cards, utilities still owed,” he said. “This gap in the additional benefits is just going to make that hole worse.”

The whole economy will suffer because struggling Americans won’t have money to pump into the economy, Lewis said.

Sen. John Cornyn, R-Texas, has called the $600 a week federal unemployment benefit a "mistake." But his office said he supports extending some level of enhanced benefits for out-of-work Americans.
Sen. John Cornyn, R-Texas, has called the $600 a week federal unemployment benefit a "mistake." But his office said he supports extending some level of enhanced benefits for out-of-work Americans. (Susan Walsh)

And still, Congress has failed to reach an accord as millions of unemployed workers in Texas and beyond have fretted over the looming benefit cut.

The Democrat-run House weeks ago passed an extension of the unemployment benefits as part of a massive coronavirus relief bill. But that legislation served more as a starting point for negotiations, since all parties involved knew it was dead on arrival in the GOP-run Senate.

Republicans, meanwhile, haven’t been able to unite even their own caucus, as many conservatives have complained that the enhanced payouts are hurting the country’s recovery.

“There’s no rationale for paying people more than 100% of their previous earnings,” wrote Rachel Greszler, a research fellow at the Heritage Foundation, a conservative think tank, adding that the real “cure is getting Americans back to work.”

The Senate GOP’s divide over the benefits and other issues spotlights fissures over the extraordinary bill Congress is racking up to combat the pandemic. But it also reflects election season stressors —namely that some senators are dealing with them, while others are not.

Sen. Ted Cruz, a Republican not up for reelection until 2024, has railed against the growing price tag, chastising some fellow Republicans for a lack of fiscal restraint and warning that “there is significant resistance to yet another trillion dollars.”

He has rejected the idea of extending the $600 per week benefit and appears to be wary of any enhanced unemployment aid.

“Sen. Cruz … believes the existing proposals, including those that continue the expanded unemployment program, will only deepen and further prolong the economic devastation we’re seeing,” a Cruz spokeswoman said.

But Sen. John Cornyn, also a Republican, is bracing for a tough reelection challenge from Democrat MJ Hegar, who has dinged him for his comments that the $600 weekly unemployment benefit was a “mistake” because it allowed some workers to receive more than their regular wage.

A Cornyn spokesman said the senator “supports extending an added federal benefit on top of the normal unemployment insurance.” The Republican hasn’t committed to a dollar-figure, but he has touted the broader bill that would reduce the benefit to $200 per week.

James Barragán. James Barragán covers Texas politics for The Dallas Morning News. He has covered immigration, public safety and voting rights and has traveled on assignment to the U.S. Supreme Court and Houston during Hurricane Harvey. Before joining The News in 2017, he worked for the Austin American-Statesman and The Los Angeles Times.

jbarragan@dallasnews.com /JamesBarraganNews James_Barragan

Tom Benning. Tom covers the intersection of business and government in Washington. He came to D.C. in 2016 from The News' Austin bureau. He has also previously worked in Dallas, covering everything from City Hall to transportation to former President George W. Bush. He is a graduate of the University of South Carolina.

tbenning@dallasnews.com @tombenning
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