The $400/week unemployment insurance plan the president proposed yesterday just might work. Give the White House some credit for creative finance, as they shoe-horned it into a FEMA emergency relief fund for folks who are out of work due to an emergency but fall through the normal unemployment cracks.
I would think that would be designed for folks displaced from their job due to a flood or a hurricane; I'm picturing a business in downtown Sanford just NW of Midland that got wiped out this spring when the Sanford Lake dam collapsed. COVID doesn't quite fit the design of such a regional tragedy, but it isn't much of a stretch to treat the current unpleasantness as a disaster. Thus, it might just pass legal muster.
Two caveats are mentioned in the CNBC piece. One is that the money is a 75%-25% federal-state match, so states would have to pony up $100/week for each covered worker. That might be hard to conjure up in a state that is spending more due to COVID and bringing in less tax revenue. Doubly so when any federal help to cover those state budget deficits is not forthcoming; the Republicans are not thrilled "bailing out" more-generous Democratic state governments who were the hardest hit during the first batch of cases this spring. State governments will be torn between helping their needy and balancing their budgets.
Also, some Democratic governors might be leery of taking part if it is seen as selling congressional Democrats up the river and partnering with Trump on a financial Rube Goldberg end-run of the legislative process. I'd expect some push-back from quarters on the left on states going along with this, just as many Republican states were less than thrilled with being a part of Obamacare.
The other bug in this FEMA plan is that the normal unemployment insurance system can't be used to deliver it. The initial system set up this spring piggy-backed on existing unemployment infrastructure. Folks can't be on both normal unemployment and this FEMA 400 (sounds like a new NASCAR race heavy on crashes). Thus, we'd need to see states have to quickly (or not so quickly) craft a institutional and software system to administer this new FEMA moolah; easier said than done.
For Trump, any slowness can be blamed on lousy state governments, not FEMA. Any Democratic opt-outs of the plan can be spun as lefties caring more about politics than the needy. If neither takes place, I'll eat my words, but the odds are good on both happening.
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