Senate Republicans unveiled a proposal that would drastically slash federal unemployment benefits to more than 30 million Americans laid off amid the coronavirus pandemic, The Washington Post reports.
The GOP plan calls for reducing the total unemployment payments from 120% of previous salaries to 70% of previous salaries. The GOP plan would require states to implement a new system, which upended negotiations in March because aging state systems are seen as incapable of handling the load. The new plan calls for a cap on income as well.
In the meantime, the GOP plan would reduce the $600-per-week federal benefit to $200 per week and provide states with a waiver if they are unable to switch to the new system within two months.
Democrats immediately rejected the proposal.
GOP plan includes direct payments:
Along with the unemployment cut, the GOP plan would include $1,200 direct payments to most Americans.
The $1 trillion package also includes billions of dollars for schools, with extra funding for those that reopen for in-person learning, liability protection for businesses whose workers get sick, and money for health care programs and testing.
The proposal also includes $100 billion for the Paycheck Protection Program.
The proposal does not include any additional funding for states and local governments, though it does provide added flexibility for spending the $150 billion for states that Congress approved in March.
GOP unemployment cut would be catastrophic:
Numerous analyses have shown that the overly-generous unemployment benefits have helped prop up the economy amid business closures and reduced spending.
An analysis by Moody’s Analytics chief economist Mark Zandi showed that the GOP unemployment cut would shrink the economy and cost nearly 1 million jobs by the end of the year.
A separate analysis by the progressive Economic Policy Institute projected that that number would rise to 3.4 million within a year.