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With 'Economic Calamity' Looming, Progressive Groups Demand Unemployment Insurance Benefit Remain in Place

"Unemployment Insurance is keeping the economy afloat."

A person files an application for unemployment benefits on April 16, 2020, in Arlington, Virginia. (Photo: Olivier Douliery/AFP via Getty Images)

Two dozen leaders of progressive research and advocacy groups in a letter to Congress Wednesday urged federal lawmakers to ensure the federal coronavirus unemployment benefit of $600 a week is kept in place for the duration of the pandemic, arguing that to allow it to expire would be to risk "economic calamity."

"Federal Pandemic Unemployment Compensation (PUC), which is giving tens of millions of unemployed workers a $600 per week boost in unemployment income, has helped ease the pain of this crisis by providing much-needed income to families during an economic crisis and has boosted the economy overall," the letter, a copy of which was sent to Common Dreams, declares.

The letter—signed by groups including MoveOn and the Groundwork Collaborative—adds that "Unemployment Insurance is keeping the economy afloat" by helping workers pay their bills.

"Slashing workers' incomes now, by any amount, before it is safe to go back to work—and while there are still more than three times as many unemployed workers as job openings—will further hurt demand," says the letter. "Any cut will mean millions of families will have less to spend at grocery stores, restaurants, and other businesses, which will catalyze a second wave of layoffs and compound economic hardship across the country."

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As Common Dreams has reported, workers' rights advocates and economic experts continue to warn that not renewing the benefit could crash the fragile U.S. economy and lead to a wave of evictions and bankruptcies as millions remain out of work in the midst of the pandemic. 

On Tuesday, economist Doug Henwood argued at Jacobin that the program's end "would be massively destructive."

According to Henwood:

If those benefits are allowed to expire or are renewed at a lower level, look out below. Even with them, food banks have been doing a record business. With Covid-19 caseloads rising in much of the country with little relief in sight, employers are preparing for a fresh round of firings. Dreams of a rapid recovery in the second half of this year have evaporated in all but the most delusional of minds. If unemployment benefits are cut, in addition to spreading mass sickness and death, there will be a fresh round of immiseration.

As Congress debates the next pandemic relief bill, with no quick solution in sight—Senate Majority Leader Mitch McConnell (R-Ky.) laughed Tuesday when asked if legislation would be finished before the $600 payments end this week—some advocates are calling for a temporary reauthorization of the full slate of unemployment benefits to tide the American people over while the Senate and House thrash out the next bill. 

"There is a very obvious and simple way to deal with this situation," Slate's Jordan Weissman wrote Wednesday. "Congress should just extend the $600-per-week unemployment benefits that are now in place for an additional two or three weeks."

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