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Lawmakers, policy analysts call for federal unemployment to offer $400 weekly boost, expire in September

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Sen. Ron Wyden (D-OR) reiterated the need to pass the next round of stimulus relief ahead of March 14, extend federal unemployment programs through September and provide a $400 weekly boost to jobless benefits on a press call hosted by Invest in America Action, a progressive advocacy group.

The senate finance committee chairman joined Elizabeth Pancotti, policy director at Employ America, Wednesday to discuss the latest negotiations over the $1.9 trillion American Rescue Plan. The House passed its version of legislation early Saturday, and the Senate is debating provisions this week.

The latest version of the bill extends pandemic-era unemployment programs for gig workers and the long-term unemployed through the end of August, which is one month shorter than President Joe Biden's original proposal. Critics of the earlier expiration have pointed out that Congress typically isn't in session in August, so if the policy measures expire at this time, it's more likely to cause a benefit lapse. 

"It's a prescription for trouble to have this expire in August," Wyden said.

Many will remember that following the July 31 expiration of the $600 weekly UI supplement from the CARES Act, negotiations on a new round of relief between Congress and the Trump administration dragged on for months.

Some, including Pancotti, are calling for federal benefit expirations to be tied to labor market indicators, such as the unemployment rate. "It's truly a shame Congress keeps having to come back to this and keep jobless workers in limbo when they could enact automatic extensions to jobless benefits until the market recovers, which we expect will take some time," Pancotti said.

Wyden added Democratic senators are making "good progress" on negotiations and consider passage of the bill by March 14, when current legislation expires, a "top priority."

"This critical relief package is going to get done before anybody goes over the cliff," Wyden said. Without action, 11.4 million people are expected to start losing jobless aid on March 14, according to estimates from The Century Foundation. Policy analysts say Congress and Biden should ideally pass new legislation two to four weeks before the mid-March deadline in order to deliver aid with minimal delays.

The weekly federal unemployment boost was up for debate again this week with Sen. Joe Manchin (D-W.V.) saying he supports cutting the proposed $400 per week back down to $300 because it's "consistent with what we've been doing," Newsweek reports. He also backed ending federal enhancements by August.

"Some of these things here just doesn't make sense. It doesn't incentivize people," Manchin told reporters Tuesday, noting that more Americans are expected to become vaccinated against Covid-19 by the summer. "It'd be awful for the doors to open up, and there's no one working. You got a lot of customers, no one working. That's the problem."

growing body of research has shown no such correlation between boosted unemployment pay and people not returning to work. Rather, the most important factor in whether people returned to work was the availability of jobs.

On the press call Wednesday, Wyden said he "feels very strongly" about continuing the federal enhancement at $400, which he said especially helps low-income workers cover essential bills and stimulate local economies.

One new analysis from the U.S. Bureau of Economic Analysis found that personal income soared by 10% from December 2020 to January 2021 thanks in large part to government aid, including a $600 stimulus check and boosted jobless benefits. Consumer spending increased by 2.4% in January, with an estimated $277.2 billion more going to durable goods like vehicles and food, and an estimated $63.7 billion more going toward services like eating out.

Under current legislation passed in December 2020, enhanced benefits include an additional $300 per week on top of state aid through March 14, and federal programs phase out completely by April 11.

Check out: Latest unemployment boost is 'too little, too late,' workers say: 'They forgot about us a long time ago'

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