The good news: The Senate GOP and the White House appear to have finally coalesced behind a Phase 4 proposal. The bad news: It still appears that they haven’t done much to solve the underlying problems of Phase 3’s CARES Act. In part, that failure stems from the failure of states to retune their unemployment-benefit systems, but that still leaves the Republican proposal where it could have been two or three weeks ago.
Jazz hinted earlier that the White House and Mitch McConnell would move forward with a patch to the federal unemployment benefit that simply capped the benefit lower than its current $600 per week, rather than use a formula to adjust the benefit against previous earnings. The Washington Post reported shortly afterward that the cap would be lowered to $200 per week in an attempt to make sure no one makes more on unemployment than they would from working a job, removing one disincentive for employment:
Senate Republicans will propose cutting weekly emergency unemployment benefits from $600 to $200 until states can bring a more complicated program online, according to two people familiar with the plan granted anonymity to share details that had not yet been released.
The proposal will come as part of a broader $1 trillion stimulus bill aimed at dealing with the economic fallout caused by the coronavirus. Republicans plan to release later on Monday and that they hope to use during negotiations with Democrats. The $600 weekly jobless benefit expires in a few days, and House Democrats have proposed extending it until January because the unemployment rate remains very high.
Senate Republicans want to reduce the $600 payment to $200 until states can implement a new approach that would pay workers 70 percent of the income they collected before they lost their jobs. The states are supposed to phase in the new formula within two months.