There has been a lot of talk recently about a second stimulus package in the U.S. as the coronavirus pandemic continues and cases are spiking in Hampton Roads.
There is a bit of a rushed feeling with the bill as a recess coming up soon for both the Senate and House of Representatives. Also, the end of the week marks the end of the $600 enhanced unemployment payment that was being paid on top of the states’ regular unemployment payments, and Senators are rushing to come to a deal by the time ends, which may be a big sticking point.
What does each side want to see when it comes to the enhanced unemployment benefit?
Carl Carlson, CEO of Carlson Financial, said under most state programs, unemployment insurance only replaces about 50% of an employee’s lost wages. The $600 enhance benefit helped to make up the difference, but for many people, it gave them more than 100% of lost wages.
Senate Democrats would like to see the $600 continue through the end of the year, while Republicans are proposing that it be reduced to $200 until states can transition to paying 70% wage replacement. That would have the Federal government only paying the additional until states can take over, Carlson added.
They’re also proposing a $1 trillion stimulus package that would include a second round of stimulus checks, with the same income limits as before. It would also include money for schools, money for new testing and vaccines, more small business loans and tax incentives that would encourage companies to rehire or retain employees.
Carlson said there are a number of non-monetary things the proposal would address, such as extending the eviction moratorium, liability protections for businesses, schools, and healthcare providers, and flexibility for states to spend money from the original CARES Act.
Time will tell if an agreement is made.