The extra $600 in unemployment benefits included as part of the CARES Act expired on July 31, 2020. Despite the fact that COVID-19 is still raging, and many states are closing their economies back down and firing workers again as a result, Republicans STILL don’t want to pass the HEROES Act, which would extend the added unemployment benefit.
The unemployment crisis is especially acute for Black Americans, whose unemployment rate remains over 30% higher than that of white Americans at 14.6%.
It turns out, this unemployment crisis may have been totally unavoidable.
What will the more than 30 million families struggling with unemployment do now that the benefit has expired and Congress can’t pass another bill? The Congressional Budget Office predicts high unemployment through 2021. Many of the lost jobs just won’t come back.
All of these factors could spell another unemployment disaster: “With fewer customers, many who were able to go back to work could find themselves out of a job, causing a second wave of mass unemployment,” argues Alicia Adamczyk at CNBC.
Other hard-hit countries took a different approach, however, and have had very different results.
In the U.S., citizens were given $1,200 and unemployment was temporarily strengthened. But with a haphazard federal response to the crisis and no end in sight, many saved this money rather than spending it.
Benefits to small businesses were difficult to come by and had little oversight. As a result, over 100,000 small businesses have closed for good. Many countries in Europe and elsewhere, though, have avoided this impact.
They decided that it’s better “to pay up and keep people on payrolls than risk economic disruption from mass layoffs,” reports Business Insider. Denmark, the Netherlands, and the UK are paying 75-90% of workers’ salaries, to prevent mass closures of businesses and layoffs. But that’s not all.
Germany, France, Italy, and other countries in Europe had similar programs, according to the Financial Times.
Now, they are relaxing lockdowns, and appear to be avoiding the COVID-19 surges we are experiencing. This is due to how they handled the economic impacts and avoided unemployment, as well as how aggressively they shut down and how seriously their leaders took the crisis.
But it’s also deeper than that.
The difference between the U.S. and Europe “is not the nature of the bailouts. It’s the underlying structure,” according to Carol Graham of the Brookings Institution, quoted in the New York Times. “People are more vulnerable from the get-go, even in normal times. You throw a shock like this at the system? It’s about as bad as it could get.”
America does not guarantee citizens health care, and treats its workers worse than any other developed nation. Along with a confusing response to the pandemic and a President who has consistently refused to take responsibility for managing it, it seems like COVID-19 will continue to ravage the United States worse than almost every other country.