- The Trump administration said it would cut its unemployment-benefit boost to $300 after triggering criticism from states that said they were unable to afford their share.
- A top White House official said on Tuesday that a jobless-aid plan requiring states to kick in 25% of a $400 benefit was “modified” to address their concerns.
- The move means unemployed people will see their enhanced benefits cut to $300, half of the federal benefit that lapsed at the end of July.
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The Trump administration said on Tuesday that it would cut its unemployment-benefit boost to $300 from $400 after triggering blowback from cash-strapped states that said they couldn’t afford to pay their share.
President Donald Trump signed a memorandum on Saturday to implement a $400 supplement to state unemployment benefits that would phase out by December 6. States would foot 25% of the cost and provide $100, while the federal government would pick up the rest.
But state officials from both parties criticized the measure’s feasibility, The Washington Post reported on Monday.
Larry Kudlow, the director of the White House National Economic Council, told Fox News on Tuesday that states wouldn’t have to kick in $100 for eligible residents to enact the program the Trump administration laid out.
“We modified slightly the mechanics of the deal,” Kudlow said.
It means the boosted benefits for jobless Americans would be $300, half of the $600 federal benefit that was in effect from late March to the end of July.
States are weathering severe budget shortfalls due to the pandemic. And governors have urged Congress to pass a spending package with at least $500 billion in federal aid to state and local governments to shore up their finances.
Many governors expressed concern about designing another benefit system from the ground up.
“This is not something that any state will be able to do quickly,” Pennsylvania Gov. Tom Wolf’s administration said in a statement on Monday.
Kentucky Gov. Andy Beshear, a Democrat, told The Post that the Trump administration’s plan was “not workable in its current form” and estimated its price tag at $1.5 billion.
Other state leaders said they had already allocated money and that existing funds were slim. Republican Gov. Asa Hutchinson of Arkansas told The Post the state had appropriated $200 million in federal funding in case the outbreak worsened in the coming months. “We would have to adjust that completely,” he said.
Several state unemployment agencies are waiting for guidance from the federal government before trying to move ahead with the order. Experts have said that, if implemented, the program would last only about five or six weeks.
Meanwhile, stimulus negotiations between top congressional Democrats and the White House fell apart last week over fierce disagreements on state aid and enhanced unemployment insurance. Both sides are deadlocked; a deal does not appear imminent.
About 32 million Americans are using unemployment benefits, which usually cover half of their lost wages.