Most of the relief measures included in the historic stimulus package Congress passed in March are coming to an end, even as the financial suffering of millions of Americans, and the virus to blame, shows no sign of abating.
Some 25 million Americans are receiving the additional $600 federal unemployment benefit established in the federal CARES Act, and the unemployment rate continues to rival Great Depression-era highs. Half of American households say they have lost income during the pandemic.
And the pain is far from over. There were more than 62,000 new reported cases of the virus in the U.S. just yesterday. As a result, many states are walking back their plans to reopen.
Congress returns to Washington this week to work on a second stimulus package.
The first set of legislation is credited with keeping as many as 16 million Americans out of poverty. If the relief measures in the CARES Act are allowed to expire without replacements, experts warn of an unprecedented financial crisis.
By July 31, people will stop receiving the $600 federal weekly unemployment checks. Yet the Congressional Budget Office expects jobless rates to stay elevated through 2021, and unemployment is still over 11%, with some areas especially hard hit.
"If policymakers don't act this week to extend the increased benefits, they will expire while unemployed workers and the economy need substantial support," said Chad Stone, chief economist at the Center on Budget and Policy Priorities.
Without any extension of a federal unemployment benefit, jobless Americans will have only their weekly state checks to rely on. Thanks to the CARES Act, most workers will be able to collect these payments for 39 weeks, compared to the usual 26 weeks.
Still, experts say people can't survive on their state benefits alone. The average state check nationwide stands at around $333 a week but dips as low as $100 in Oklahoma.
"These benefits are wholly insufficient," said Michele Evermore, senior policy analyst for the National Employment Law Project.
"Losing the $600 will mean people will put themselves in physical jeopardy by showing up to unsafe jobs to keep themselves afloat," she added. "For the people who can't find jobs, they're going to lose their homes.
"They're not going to be able to afford food, and they're going to take on debt that will stay with them for years."
The $1,200 cash payments sent out as part of the CARES Act are likely already long gone for many Americans struggling amid the pandemic.
Another round of cash payments, however, could be coming. Experts say that in a recession this severe, stimulus checks are necessary because state unemployment systems can be slow-moving. Indeed, there have been stories of people waiting more than eight weeks for the checks.
"The stimulus checks reach more people, more quickly," said Felicia Wong, president and CEO of the Roosevelt Institute, a New York-based think tank.
House Democrats passed a $3 trillion stimulus bill, the HEROES Act, in May that included giving another $1,200 to each American who earned less than $75,000 a year. President Donald Trump called that legislation "dead on arrival," but the White House has since signaled support for more stimulus checks. Recently, Senate Majority Leader Mitch McConnell, R-Ky., suggested disbursing the funds to people making $40,000 or less a year.
In an interview earlier this month on CNBC, Treasury Secretary Steven Mnuchin declined to say whether or not he supported that income cap. But he confirmed that the White House was still in favor of another round of payments. And once the details are finalized in the Senate, he said, "we can get that into hard-working Americans' bank accounts very, very quickly."
The payment pause in the CARES Act for student loan borrowers will end in September, impacting as many as 45 million Americans who hold the debt. Consumer advocates warn that many borrowers won't be ready to make payments then. Young people have been particularly impacted by the recession, with as many as 1 in 4 people between the ages of 16 and 24 unemployed.
"If borrowers are forced to resume repaying their student loans on Oct. 1, delinquencies and defaults will skyrocket," said Mark Kantrowitz, a higher education expert. "This year's college graduates are entering the worst job market ever."
House Democrats want to extend the break for student loan borrowers until September 2021. "Pretty much nobody thinks that will happen – including me," said Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit that helps student loan borrowers with free advice and dispute resolution.
Still, Mayotte said, "I do think there's a good chance Congress will extend the waivers until the end of the year."
In the meantime, many statewide eviction moratoriums have now expired. In some 30 states, the proceedings can continue. And the eviction moratorium for those living in properties backed by a federal mortgage or receiving government-assisted housing expires on July 25.
As a result, up to 40 million people could lose their homes in the coming months, said Emily Benfer, an expert on evictions and health justice lawyer.
"This data shows us that all the terms people have been using to describe what's coming – 'cliff', 'tsunami', 'avalanche' and so on – might actually be an understatement," said John Pollock, coordinator of the National Coalition for a Civil Right to Counsel, in a statement.
"The only reason we haven't already seen 2 million eviction filings is because of all the CARES Act relief that at this point is either going or gone."
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