U.S. Senate Majority Leader Chuck Schumer (D-NY) speaks to reporters at the U.S. Capitol, on Capitol Hill in Washington, February 10, 2021.
Al Drago | Reuters
Senate Democrats have agreed to cut the weekly unemployment insurance supplement in their $1.9 trillion coronavirus relief bill but extend it for a longer period of time.
However, reports indicated Democratic Sen. Joe Manchin of West Virginia was reluctant to back the policy, which threw the chamber into chaos Friday and delayed his party’s efforts to pass the legislation. The first in a long series of votes — a failed effort by independent Sen. Bernie Sanders of Vermont to include a $15 per hour minimum wage — was still ongoing after nearly four hours as senators decided how to proceed.
Manchin was reportedly considering supporting a plan from Sen. Rob Portman, R-Ohio, that among other things would cut enhanced federal unemployment benefits off earlier than most Democrats want.
Democrats aim to make their change to the unemployment provision Friday during a marathon of votes on amendments known as a vote-a-rama. Sen. Tom Carper, D-Del., was set to propose the plan.
The amendment would maintain the federal jobless benefit supplement at the current $300 per week level, rather than increase it to $400 as a House-passed bill did. The change would keep the policy in place through September, rather than end it on Aug. 29 as the House plan did.
The proposal would also make the first $10,200 in unemployment insurance untaxed. The provision aims to prevent surprise tax bills for beneficiaries.
The change to unemployment aid appeared to be an attempt to appease disparate members of the Democratic caucus. The party cannot lose a vote and still win a simple majority, the baseline needed under budget reconciliation in the chamber split evenly by party.
Cutting the unemployment benefit by $100 per week appeared to be a concession to the most conservative Democrats. Party leaders already agreed to limit the number of people who would get $1,400 direct payments because Manchin and others had concerns about how the checks were targeted.
The extension of extra jobless benefits was also expected to appeal to senators led by Democrat Ron Wyden of Oregon, who worried about millions of Americans suddenly losing financial support when the jobless benefit programs expired in August. Provisions providing a boost to unemployment benefits and extending eligibility for them lapsed once last summer. Congress did not renew them until December.
Wyden has called to tie the jobless aid to economic conditions so that it does not expire before the economy recovers. In opposing the relief bill, some Republicans have contended a $400 per week unemployment boost would discourage people from returning to work. They made the same argument when lawmakers approved a $600 per week supplement last year, but some research suggests the policy would not have a major effect on people deciding to seek jobs.
Democrats aim to approve their latest rescue package before March 14, the day when the current $300 per week unemployment benefit expires. However, the delays Friday threatened its quick passage as the deadline approaches.
Senate Democrats hope to pass the bill by this weekend. Republicans can drag out the process, as they face no limit on the number of amendments they can offer to the plan.
The House aims to approve the Senate version of the plan by next week and send it to President Joe Biden to sign into law.
— CNBC’s Ylan Mui contributed to this report
