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Trump's extra $300 in unemployment benefits could run out in 3 weeks

Trump's executive actions spark confusion
Trump's COVID-19 executive actions spark confusion, raise legal and constitutional questions 02:46

The 25 million Americans who are collecting unemployment benefits may see only limited relief from President Donald Trump's move to provide an extra $300 in weekly jobless aid. A new memo from the government agency overseeing the relief says it's planning an initial payment equivalent to three weeks of benefits, less than previous estimates that pegged the money as lasting up to six weeks

The Federal Emergency Management Agency said it will send "an initial obligation of three weeks of needed funding" to states that are approved to receive the aid. The agency also said that additional money will be provided on a weekly basis "to ensure that funding remains available for the states who apply for the grant assistance." 

FEMA didn't immediately respond to a request for comment. 

President Trump has promised $400 per week in extra unemployment assistance, but only $300 of that stems from federal funding. States would have to provide the remaining $100, a strain on local budgets.

Mr. Trump's executive order earlier this month is aimed at providing financial support for jobless workers after the $600 in extra weekly pandemic aid, which was directed by the Coronavirus Aid, Relief and Economic Security, or CARES, Act, came to a halt at the end of July. Congressional Republicans and Democrats remain far apart on another stimulus bill that would extend additional jobless aid. 

"If this rolls out poorly, I think this could actually create more pressure for Congress to act," said Michelle Evermore, senior policy analyst at the National Employment Law Project, of the White House's plan "There are people who think this lifted pressure to do something this month, but I suspect when states try to do this, it could reveal major insufficiencies."

Mr. Trump is funding the supplementary unemployment benefits through FEMA's Disaster Relief Fund, which has $44 billion in available funds. But already, other claims are arising, with Iowa asking for $4 billion in disaster assistance after a derecho with hurricane-force wind gusts either destroyed or extensively damaged 8,200 homes and 13 million acres of corn, about a third of the state's cropland. 

"There might not be a whole $44 billion available," Evermore noted of Iowa's request for aid. And hurricane season could result in more demands for disaster relief money, she added.

Worker on unemployment should not expect more than three weeks of benefits, said Andrew Stettner, senior fellow at The Century Foundation, a progressive think tank. "However, there seems to be enough in the fund to support several more weeks of benefits as long as there are not other major competing demands for disaster relief," he noted.

Benefits by September?

For now, unemployed workers have yet to see a cent in Mr. Trump's extra aid, although FEMA said the additional benefits could reach workers as soon as the end of August. The agency memo says the benefits could arrive about three weeks after August 8, the date when Mr. Trump signed the order. That would mean the extra $300 could reach jobless workers by around August 29. 

Jobless claims dip below 1 million for the first time since March 01:48

Still, experts believe that's an optimistic goal. 

"Many states will be challenged to derive additional aid as quickly as FEMA promises, in time for September rent," Stettner said. "Plus, it is well short of meeting the full living expenses for many families."

Uncertainty over the rollout of the benefits, as well as whether Congress will extend the pandemic jobless benefits that ended in July, is taking "a toll on workers," added Evermore. "Three hundred dollars for three weeks is a far cry from $600 for six months, which is what workers and the economy really need right now."

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