The CARES Act: Stimulus and Unemployment Checks

By Lambert Strether of Corrente.

I am sure the hilariously named CARES (“Coronavirus Aid, Relief, and Economic Security”) Act is just as horried as the 2008 bailouts, if not moreso — if only because the people in charge are even more greedy and venal than 2008’s crew[1] — but in this post, I’ll focus exclusively concrete material benefits for the working class — sadly, not universal — as opposed to whatever meagre benefits will “trickle down” from however our betters reconfigure “the economy.” this time. (There will, apparently, be more stimulus to come, when our lawmakers return from their vacation[2]. The unemployment provisions should be beefed up as well.)

The key point of the CARES that means-testing and complex eligibility requirements will only be pried from the cold, dead hands of the political class. As Peggy Noonan wrote (Links, this morning):

Eight days in I entered the living hell of attempting to find my results through websites and patient portals. I downloaded unnavigable apps, was pressed for passwords I’d not been given, followed dead-end prompts. The whole system is built to winnow out the weak, to make you stop bothering them. This is what it’s like, in a robot voice: “How to get out of the forest: There will be trees. If you aren’t rescued in three to seven days, please try screaming into the void.”

I’ve been considering filing material like this under “Failed State,” but it also seems to me that our State is doing exactly what it is designed to do. If you think about it, one of the most remarkable features of this whole ongoing debacle is that even after the last Crash, the Federal Government still does not have a simple, universal way to send every eligible resident in the country money. In Canada, by contrast:

11:25 a.m.: Trudeau says new federal benefits for those losing income due to COVID-19 will be in people’s pockets within 10 days of their applications.

He says the government has redeployed thousands of civil servants to work on the benefits package so the funds can flow to people as soon as possible.

11:20 a.m.: “Help is on the way,” Trudeau says in announcing the emergency response benefit that will provide $2,000 a month for four months for people who have lost their income because of COVID-19. The Canada Emergency Response Benefit combines two benefits announced last week to streamline application process.

But then Canada is a First World country.

That said, the concrete material benefits to the working class come in two forms: stimulus checks, and unemployment checks. Let’s take each in turn.

Stimulus Checks

So, the $1,200 check. (It isn’t always $1,200, but we’ll get to that). I’ve always wondered: Why $1200? I can’t dig up the legislative history, but one theory is that the minimum wage of $7.25 * 40 hours = $290 a week * 4 = $1160 a month. Rounding up, the government is paying you minimum wage for a month. But there are more entertaining theories:

(Here is the source.) There’s also a whole “news you can use” genre of “What should I do with my stimulus check?” where “the experts weigh in,” but basically the $1200 might as well have been directly deposited in your landlord’s account: Renter-to-rentier, as it were.

Anyhow. I’m going to ask four questions about the stimulus checks:

Who gets a stimulus check?

Here is a handy chart of the eligibility requirements (source; qualifications):

(One eligibility requirement is missing: You cannot owe child support. Otherwise:

Owing back taxes or other debt to the government is not a problem, according to Sen. Chuck Grassley, R-Iowa, the chairman of the Finance Committee and a key author of the bill.

The legislation “turns off nearly all administrative offsets that ordinarily may reduce tax refunds for individuals who have past tax debts, or who are behind on other payments to federal or state governments, including student loan payments,” Grassley wrote in a medium.com post.

“The only administrative offset that will be enforced applies to those who have past due child support payments that the states have reported to the Treasury Department,” he continued.

To be fair, for somebody like Grassely, this is generosity on a lavish, princely scale.

How much will the check be?

Here is a handy chart from the Tax Foundation, in “Congress Approves Economic Relief Plan for Individuals and Businesses“:

Here is a calculator if you don’t like charts.

How long will the check take to arrive?

This is where things get really complicated. The default case:

The IRS is expected to start distributing the rebate checks within the next three weeks. The payments will be sent via direct deposit to Americans who already have provided the IRS with their bank account information. For those who haven’t, the checks will be mailed.

On mailing:

[T]he IRS can mail a check to your “last known address,” and it has 15 days to notify you of the method and amount of the payment. They’ll send a phone number and appropriate point of contact so you can tell them if you didn’t receive it.

If your “last known address” isn’t your current address, this is what you can do:

If you have recently moved, you should file a Form 8822 with the IRS and a change of address notice with the U.S. Postal Service. This will ensure correspondence and payments from the IRS will be sent to your new address.

The bottom line:

Anyone who doesn’t already have direct-deposit information on file with the IRS may not see their emergency funds for up to 4 months.

Some emergency. I would also guess that if landlord-tenant relations deteriorate as there are many, many anecdotal reports they will, a lot of people’s addresses are going to change, screwing up check delivery for millions. 36% of American households rent their homes.

When will the checks stop?

The stimulus checks are a one-time payment. What you do you think we are? Canada?

Unemployment Checks

Now let’s turn to unemployment checks. Before we ask the same four questions, let’s look at capacity issues. Here’s a chart of unemployment benefits filings:

Vox remarks:

Instead of a one-off spurt, last week’s eye-popping initial claims number could be just the leading edge of a larger tsunami that will continue to press forward for several weeks.

It’s not clear to me that our unemployment system, which is handled administratively at the State level, has the operational capability to handle this surge. In Ohio:

The [Ohio Jobs and Family Services] spokesperson continued: “During previous downturns in the economy, claims trickled in, whereas these claims came in all at once. This amount of claims in this short expanse of time would tax any online system. We have been working around the clock to streamline performance and boost capacity so the online claims system can handle the unprecedented influx of claims, which has affected processing times.”

In other words, the spike faced by emergency rooms and hospitals is, as it were, replicating itself across other systems. I’m sure each state unemployment office is calculating throughputs, but I don’t know if they can scale up the capacity. From the New York Times, “Coronavirus Layoff Surge Overwhelms Unemployment Offices“:

From New Jersey to Texas to Oregon, the newly jobless have tried to file claims, only to run into glitchy websites and clogged phone lines.

Help is on the way. A stimulus bill that President Trump signed into law on Wednesday provides $1 billion in emergency grants to states for unemployment insurance, and fully half could be immediately used to strengthen staffing, technology and other administrative costs.

Even when unemployment was stable and low, state employment offices were “threadbare,” said Andrew Stettner, a senior fellow with the Century Foundation, a public policy research group.

State unemployment insurance programs rely on federal grants to pay for the administration of benefits, but those costs have been cut by 30 percent over the past two decades, he said.

Part of the reason for low staffing: Unemployment office head counts are pegged to the unemployment rate, which had reached historic lows before the pandemic hit.

Now, a bureaucracy with well-defined procedures and functional IT ought to scale to meet the crisis, much like spinning up more servers on a server farm. However, if the state systems are held together by bubble-gum and baling wire, then there’s a good possibility Brooks’ Law will apply (“adding manpower to a late software project makes it later,” because it takes time for new people to become productive, and communication overhead increases as headcount increases.” A dysfunction department is a lot more like a project than a server farm is). I guess we’ll find out.

Who gets an unemployment check?

To be fair, the CARES Act does expand unemployment coverage significantly[3]. I wish I had a chart, but in prose from the National Law Review, “Unemployment Insurance Provisions of the CARES Act“:

Under Section 2014 of the Act, individuals who are otherwise eligible for unemployment benefits under state or federal law will receive $600 per week, in addition to their regular unemployment compensation under state law, through July 2020….

Under Section 2107, if individuals remain unemployed after their state employment benefits are exhausted, the federal government will fund up to 13 weeks of additional unemployment benefits – thereby increasing to 39 weeks the 26-week maximum common under most states’ unemployment laws – at a weekly rate of $600 during that 13-week period.

Finally, under Sections 2108 and 2109, the Act will provide funding to states that currently have or choose to implement a Short-Time Compensation (STC) program for employers that reduce their employees’ hours in lieu of a lay-off and whereby the employees thus receive a pro-rated unemployment benefit. The federal government will fund 100% of the costs for states that currently have a STC program and 50% for those states that choose to implement one, in each case through Dec. 31, 2020.

Crucially, the CARES Act expands eligibility to those not currently eligible. Again from the National Law Review:

The Act, in Section 1202, will create a temporary, federally funded “Pandemic Unemployment Assistance” program providing unemployment benefits to individuals who otherwise would be ineligible for such benefits under state or federal law – such as individuals who are self-employed (for example, consultants or independent contractors), who are seeking part-time employment, or who lack sufficient work history. The Pandemic Unemployment Assistance program covers any individual who: (1) is not otherwise eligible for, or has exhausted all rights to, unemployment benefits; and (2) is unemployed, partially unemployed, or unable to work because of any of the following COVID-19-related circumstances.

(I’m not going to quote the circumstances, but they seem reasonable and capacious.) Here, at least, is a flow-chart for 1099 workers:

How much will the check be?

Again to be fair, if you accept the existing system, the amount doesn’t seem nearly as bad as it might be:

How long will the check take to arrive?

Since unemployment checks are cut by the states, it’s hard to generalize. California says three weeks, give or take:

[Loree Levy, deputy director of communications at the California Employment Development Department,] said it typically takes three weeks from the time when a person files a claim to when they receive a payment. Whether the department can keep that timeline intact is being closely watched. The independent Legislative Analyst’s Office wrote in a report last week that the massive workload would mean much longer wait times, but Levy said the department is optimistic that “clean claims without complicated issues” will still get out the door in three weeks.

Then again, it might be hard to get into the system in the first place, due to capacity issues. Here is a thread from Massachusetts 1099ers:

Unfortunately, the thread concludes:

As I said above, I guess we’ll find out.

When will the checks stop?

After four months, in the unemployment system:

The federal government’s $600 weekly payout to unemployed workers will last for a period of up to four months through July 31. Additionally, the CARES Act will extend state-level unemployment insurance by an additional 13 weeks. For instance, whereas most state unemployment benefits last 26 weeks, the bill extends benefits in those states to 39 weeks. The extended benefits will last through Dec. 31, 2020.

For Pandemic Unemployment Assistance, December 31:

Workers can receive up to 39 weeks of PUA benefits. This program is only in effect through December 31.

Conclusion

Will the CARES Act provide enough relief to prevent millions of defaults?

Hard to say. My guess is millions, no. Tens of millions, maybe yes. Tune in tomorrow when we talk about the rent!

NOTES

[1] Not to imply that Obama’s crew weren’t greedy and venal:

[2] The Senate will return April 20, if all goes according to plan. After Easter.

[3] From Oregon Live, “In ‘once-in-a-lifetime crisis,’ Sen. Ron Wyden accomplishes goal of expanding unemployment insurance“:

And Wyden had a plan. By happy coincidence, he and his people had been working on a thorough modernization and overhaul of the federal unemployment insurance program for much of the prior year.

As the bill approached a vote, Wyden and his allies had managed to include as much as $317 billion worth of expanded unemployment benefits into the legislation. A last-ditch Republican attack led by Sen. Lindsey Graham went nowhere.

With a timely assist from Sen. Bernie Sanders, who threatened to delay the bill if Graham succeeded in reducing the unemployment assistance, the 11th-hour opposition got no traction.

I’ve been trying to run down how much Sanders contributed to the unemployment clauses in the CARES Act, and so far as I can tell, he didn’t craft the legislation or amend it.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.

74 comments

  1. JBird4049

    Commenters and posters here keep commenting on our failing government and our being a nearly failed state, but good grief, this is truly foolish, even Darwin Award winning, in its scale and implementation. I do believe that Congress is staffed with unserious people for it is like Versailles on the Potomac. I am reading figures of 30% unemployment just to start and I am thinking 40% or more is more likely in a few months. A single check and maybe four months of extra unemployment pay is almost nothing in a depression like this.

    Congress had an excellent chance to stop it, but decided to give freebies to the 1% and ignore the collapsing economy. Rifting off this thought, way scares me is not the pandemic, or the economy, but the near complete failure for our government to deal with the situation as adults instead of greedy children; if they cannot, or will not, deal with such a straightforward situation such as this, what will happen when climate change really gets going?

    Does anyone have some good thoughts on what is likely to happen in the next few months as the economic collapse not only continues but speeds up? I am guessing that even when the epidemic is brought under control, the government will try to maintain a quarantine, not to keep the disease under control, but to keep the people under control as large in-person meetings are the best way to get civil unrest going.

    Reply
    1. clarky90

      “Nothing real can be threatened. Nothing unreal exists.
      Herein lies the peace of God.”

      Imo, family, friends, community, charity, barter, ingenuity, the miraculous….. are “real” and cannot be threatened.

      Finance, Insurance, Real Estate, debt….The Fed…are unreal and will be grokked as being “the emperor’s amazing sartorial innovation”. In other words, they exist only in the fevered imaginations of the deluded.

      My friend had a lucid dream. A caterpillar transforms into a butterfly. ………….

      Reply
    2. redleg

      Even a small protest will shut everything down if done by people social distancing…

      …while in their cars.

      Reply
      1. JTMcPhee

        How are the Gilets Jaunes doing these days? Hard to find much amidst the flood of confusing noise with limited signal due to all the ways the coronavirus reality is playing out. I did find this in “Le Figaro,” and it includes some video of what happens recently in Paris at the street level during the Soixante-dixieme Acte of the movement. https://www.lefigaro.fr/gilets-jaunes-mobilises-malgre-le-coronavirus-les-images-en-camera-embarquee-de-l-acte70-20200314

        Not enough Francophile Revolutionary and “activiste” spirit in America, especially given Fusion Centers, https://en.wikipedia.org/wiki/Fusion_centerthat were so successful in the dispersal of that “Occupy” nuisance, and Operation Garden Plot/CONPLAN 2502, an operational document from the “USNORTHCOM.” (For those who don’t follow, the Empire has divided the whole planet, and now outer space, into nine or ten “areas of responsibility,” including the US which is under “NORTHCOM.” https://en.wikipedia.org/wiki/Area_of_responsibility Garden Plot is the blueprint for coordinated “government” action to put down insurrection and quell any civil disturbance. It makes for interesting reading. Here’s some material on the subject: http://www.fourwinds10.com/siterun_data/government/homeland_security_patriot_act_fema/news.php?q=1230057037

        So Trump issues a Cease and Desist order, then the various arms of state power activate their pre-arranged interconnections and go about stopping anything deemed an “insurrection” or “civil disturbance.” Using whatever it takes.

        We can be glad that New Hampshire Governor Meldrim Thompson, who wanted his National Guard equipped with tactical nuclear weapons to deal with “Student unrest,” is dead. https://www.washingtonpost.com/archive/politics/1977/05/11/new-controversy-for-gov-thomson/9eee4dfd-2e36-4c5a-9c4d-40d214edb98b/ But how many other governors, and the various Middle-management “Battlespace managers” within NORTHCOM, would be happy to apply one of the military’s new “dial-a-yield” nuclear weapons to more effectively “restore order” in the event that the current stream of events causes mass protest and violence?

        Reply
        1. RWood

          Or your John Deere, or whatnot iron farm beast that rolled on the cobbles before.
          Though, there are now those domestic peace vehicles that like to tangle…

          Reply
    3. Amfortas the hippie

      a germane anecdote, hot off the press, as it were:
      cousin(#1) talked to cousin(#2), who is in the oil bidness with a company we’ve all heard of, at the level just below The Majors(Exxon, etc)
      told cousin(#1) that it’s all gone to shit and everything’s being packed up and there’s talk of widespread layoffs and bankruptcy.
      of course, being more to the Right of the sentiment thing than I, they’re ruminating about what the Boss Class can do to extract themselves from this owngoal situation…and come up with “war with russia!”/”war with Saudi Arabia!”.
      I think , rather, that a balkinisation is much more likely, if not something much worse and chaotic…but still mostly domestic.
      I’m rambling…the point is: expect many, many more layoffs and lost jobs in the near future.

      in other news….similar to the story about people in apartments panic buying baby chicks(!)…my buddy who is trying to find me some goats called. said there are none,lol…all scooped up by suburban panickers to put in their back yards next to the trampoline.
      expect the news to be filled this summer with stories of wandering goats in suburban mazes, causing all sorts of mayhem…as well as tear jerkers about animal cruelty and the cat lady on the corner who started the suburban goat rescue movement.
      meanwhile, the local market for barbadoes(a kind of sheep that’s common out here) is totally unaffected, because the suburban panickers have never even heard of a barbadoe.
      price for them actually went down, while goat prices doubled.

      it’s just a mad old world.

      Reply
      1. Eclair

        So funny, Amfortas! I am reminded of an interview, a couple of months ago (in a different world) with a tech billionaire (Elon, maybe?), who boasted that one had to have real smarts to be a techie, while absolutely anyone could drop seeds into the ground and be a farmer.

        At one point in my life, after our city allowed backyard chickens, I thought about keeping them. Quite by accident, I ran across a book on the diseases of chickens, in a used book store. Bought it, started reading it, got to the section where they talked about eggs getting stuck in the chicken’s rear. And how, as the chicken-keeping human, I would then be responsible for inserting my hand ….. Decided I would become very friendly with chicken-keeping neighbors. And find out what they would barter. Hell, I would even pay cash for eggs!

        Reply
        1. Allegorio

          That was Michael Bloomberg saying that one didn’t have to have any smarts to be a farmer. As a farmer, with a BS in Technology, farming is the hardest things in the world! So many variables, it’s ridiculous, unless you go the chemical route, as do the planet killers. Convenience is still King.

          Reply
    4. Samuel Conner

      I wonder what US domestic capacity is for manufacture of hand tools suitable for use in home gardening. Me thinks that there might be a lot of demand for these in coming months — echoes of the “Victory Gardens” of two prior existential crises.

      Reply
      1. Amfortas the hippie

        i could do that!
        between the smithy and the ordinary metalworking stuff(till i run out of oxy/acetylene, welding rods, etc)
        for the forge, , if i’m quick, i can finally obtain the barrels(dump) for a retort to make charcoal(bamboo, again), for when i run out of anthracite coke(500# stashed).
        after barbadoes, a trip to the metal pile is pretty high on my list this week.
        neither of those chores involves contact with potentially infected humans…but i have considered whether sheeps can get it, or carry it….

        Reply
    5. Paradan

      The current distribution of printer paper should be enough to support a massive flyer campaign for a month or two. After that the government(oligarchs) could cut off the supply. Need to remind people to isolate computer and printer from internet so they don’t get accused of being “Russian” spies. Volunteers can wear mask and gloves and got house to house to hand out flyers without breaking 6′ rule, and informing people about a corrupt government is an essential task.

      Reply
      1. JBird4049

        So we’re talking about samizdat?

        Almost as a joke I started to use the various historical terms for the Soviet Union when talking about the United States (Nomenklatura for the ruling political elites, Apparatchiks for the Professional Managerial Class, Stasis for the police state, and Pravda for the New York Times and the Washington Post). It is not a true joke anymore. The terms are becoming more synonymous than satirical.

        Reply
        1. drumlin woodchuckles

          Catapulting the samizdata.

          Are those little memory sticks or thumb drives or whatever they call those things . . . small enough to tie to the leg of a carrier pigeon? And light enough that the carrier pigeon could fly it to where it needs to be?

          Reply
    6. Big River Bandido

      Does anyone have some good thoughts on what is likely to happen in the next few months as the economic collapse not only continues but speeds up? I am guessing that even when the epidemic is brought under control…

      How can an epidemic be “brought under control” when this failed state denies treatment to people who can’t afford health care?

      Reply
  2. Tom Stone

    A whole shitpot full of people won’t have enough money to pay their rent or feed their children.
    TPTB are not just venal and incredibly greedy, they are stupid.

    Reply
      1. JBird4049

        Which is just about to happen and in an insulting “let them eat cake” manner. At least with the French, nobody actually planned on having the harvests fail at about the same time as King Louis XVI called up the Estates General for the first in over a century to deal with the kingdom’s collapsing finances.

        Today, under any mainstream economic theory you can name (well, maybe the most crimp Austrian or libertarian economics as I understand them) it is the government, especially the national one, job to do whatever it can prevent the entire economy from cratering and putting much, if not most, of the population into unemployment, homelessness, and destitution.

        Instead, for the second time in twelve years we are seeing the powerful, wealthy, and well connected being deliberately rewarded for helping to weaken the economy enough that it collapsed immediately while stressed and everyone else given pennies when dollars are needed to just survive.

        Reply
        1. OpenThePodBayDoorsHAL

          May the odds be ever in your favor.

          This decade’s episode of The Hunger Games will be quite different from the last one and I do believe they have grossly misinterpreted the strength of their position.

          There is something very important that They.Do.Not.Understand. That the 49% have already been absolutely robbed blind. They are already broke going into this thing. When I say “broke” I mean assets and savings.

          In the previous episode 2008+ they were able to steal the homes out from under about 9 million. Thanks Obama. But the lowest income segment still had the wherewithal and a few tiny reserves to tide them over. But that was spent trying to recover from the last crisis.

          I saw myself that further and further up the income scale people were selling their seed corn just to get by.

          This time around and a few months along I’m afraid all I see is what’s nicely termed “social unrest”.

          The absolute maddening part is that by clinging to the previous system they are condemning us all, including themselves. US Treasury could send $2000/month to every family and we would have an absolute economic renaissance. Instead I fear there will be blood.

          Reply
          1. Hepativore

            Perhaps there is credence to the theory that that the ruling elites and some of the PMC think that by denying treatment for COVID-19 by pricing it out of reach of the precariat, it will infect and kill off the people that they think are deplorables. They might not fear much of an uprising, because they can afford treatment as well as the vaccine if and when one is available. Therefore, the virus can thin out the ranks of the underclass for them as well as discourage people from staging an uprising due to the fact that many people will be too afraid to congregate in large groups for fear of catching the disease.

            Yes, it is a bit of a wacky theory, and there might not even be any concrete plan to do this, but the elites might merely steer things in this direction by continuing to do nothing while elements of this are already happening.

            Reply
            1. Amfortas the hippie

              given the history, and the rhetoric that accompanied it,that i’ve witnessed and experienced in my 50 years, I don’t think that’s a crazy thought at all.
              the really crazy thing is that it is still regarded as crazy to suggest that the Elites hate our guts and want us dead.
              is there some hard, demonstrable evidence to the contrary that i’ve somehow overlooked?
              they just get more and more shameless in demonstrating their hatred of us.

              Reply
              1. Synoia

                it is still regarded as crazy to suggest that the Elites hate our guts and want us dead.

                Except when they can grow food. But the Ariostos always look down on the peasants. Welcome to feudalism.

                Sometimes the aristos get the point. Revolting peasants revolt.

                Reply
            2. drumlin woodchuckles

              Well . . . Jackpot Design Engineering. Why let a good plague go to waste?

              The counter to that which the infected might come up with is going Typhoid Mary Corona Postal. Get in the car for one last ride to where the nearest rich and authority people live and give them corona one way or another.

              Reply
  3. xkeyscored

    I would also guess that if landlord-tenant relations deteriorate as there are many, many anecdotal reports they will …

    It’ll be harder, perhaps, for tenants to be evicted during this pandemic. Will the usual goons be allowed to do their job? Will they even want to, not knowing if the tenants or the property are infected? Or will non-paying tenants be able to ride out the storm where they are, dealing with whatever fallout ensues if things ever get back to normal?

    Reply
    1. JBird4049

      I was thinking that a 30 plus unemployment rate, which is what people usually refer to, means that there would be no one to replace the old tenants. The U-1 number figure is the rosiest one whereas the U-6 is the most accurate one with the latter usually being twice the rate of the former.

      Going further, it is probably realistic to think of an 80% plus U-6 unemployment rate within six months. Just how will landlords evict and then replace the old tenants, especially as the police will not be very interested in helping out?

      Reply
      1. ambrit

        I’ll hazard a guess and apply what I heard from several commercial renters over the past few years in reference to their “Professional Commercial Rental Managers.”
        Big “Landlords,” as distinct from small ‘landlords,’ will plow straight ahead with metrics driven evictions. Their play books are set to deliver a certain level of return on investment for the “shareholders.” Non performing rentals drag down those returns percentages. Much rather have a lot of un-rented units than “rented” units that are “loss producing” on the quarterly books.
        Secondly, to the big players in the rental game, tenants are purely numbers on a spreadsheet. Something similar to the old “Banality of Evil” effect kicks in. When one is two steps removed from the actual human beings who are your ‘clients,’ objectification allows all sorts of bad outcomes to “happen” to the ‘clients,’ without any moral or ethical concerns impinging on the efficiency of the system.
        Thirdly, the past two decades, roughly since the declaration of the ‘War on Terror’ have seen a proliferation of private armies under the guises of ‘rent a cops,’ ‘security experts,’ and the like. When the police demur, call in the Pinkertons!
        I can see a near future where equal opportunity versions of the old Night Riders spring up to combat these private goons.
        Interesting times.

        Reply
        1. JBird4049

          Gee, over a hundred million Americans threaten with eviction, not because of anything they did wrong, where at least 14% of Californians are armed and 25% of adults live in the same household. What could possible go wrong?

          And in an economic climate like this, I don’t think calling for increased gun control and harsher penalties will be very acceptable to most people at least without ensuring an end to evictions. Even if you think that guns should just be eliminated, in a situation like this, just whose side would most Americans be on? Evil, greedy investors or destitute families?

          Reply
          1. ambrit

            Don’t forget that we live in the land of the Protestant Work Ethic. As per Calvin, in this culture, the dogma is that people become destitute because they lack the ‘Grace of G-d.’ So, Financiers can self confidently declare themselves as doing “G-d’s Work,” while the destitute must suffer because it is their fate.
            As for social programs like gun control; that goal can be pursued in a manner designed to keep it completely separate from other “social evils” like poverty and inequality. Some wag a century or so ago described the repeating hand gonne as “The Great Equalizer.” Today, nothing could be more anathema to the status quo than any item or philosophy that threatens social inequality. Why, one would almost think that social equality was some sort of Communist Plot! Thus, gonnes are a Russian Plot, just like Communism! (Even though Marx and Engels were Germans, Communism is a Russian Plot? [Scratches head in puzzlement.])

            Reply
        2. notabanker

          Important point and distinction here, especially considering the securitization of anything that can be loaded in a spreadsheet and the Fed’s willingness to trade dollars for junk.

          Reply
        3. Gregorio

          It will be another awesomely great opportunity for banks, hedge funds, and private equity groups utilizing zero interest fed loans, to “acquire” “distressed” homes and apartments to add to their rental empires. When life gives the peasants lemons, the plutocracy makes lemonade.

          Reply
      2. wilroncanada

        Private equity is waiting with baited breath (sour dough) to scoop up all those properties from smaller-scale landlords who themselves fall on hard times. They will then throw in some extra kitchens and washrooms,or maybe not even that much,making two apartments or homes where one existed before, and convince the government, R or D, to downgrade their standards to meet the “market” the private equity privateers are able to slum these dwellings into.
        If you want a sink, supply your own; a toilet and tub? it’s up to you. Paint? Handrails? Interior doors? Balconies–those are extra apartments. New renters will quickly find out what “unfurnished” really means. The price will be what they are paying now.

        Reply
    2. You're soaking in it!

      Some people in the US are serially evicted, each time making it harder to get settled; most of them have some idea of how to survive whatever comes next, as they bump down the stairway of security.

      This will be very different; there are many eviction virgins out there who are likely to be making decisions between food and shelter, with little in the way of family or societal support I fear. Besides infected, how many of them are armed? How desperate would they get, and how much does a new goon cost?

      Reply
  4. Glen

    Wow, good job Senator Wyden, but please, we will need more, much more. Even now, the companies that were given TRILLIONS in the CARE Act are LAYING OFF workers.

    Reply
    1. epynonymous

      watching the president speak today right now. Just wrapping up it seems.

      He was 45 minutes late, as he spoke with various industry leaders.

      statements from the brief – there will be (says the president, not congress) a return to tax write offs for corporate restaurant spending. He seemed quite moved to hear of his favorite new york restaurants going out of business, and their difficulties recouping losses leading to a future inability to reopen. Something might get done about that.

      Also, 2 top insurance companies offered to waive deductibles, co-pays, and some third category of ‘cost sharing’ during the crisis. When questioned, Trump said that re-reimbursement were for these costs had not been discussed.

      He mentioned that the govt might ‘make money’ off all this printing because payments to corporations will be loans and might include some public ownership. (was the term mandates? close)

      There was a bit of blame going around, naturally, he implied hospitals in New York are sending masks out through back door channels. (likely, patients are using the masks.) Masks will also be cleaned and reused. 10,000 respirators in the stockpile will be kept in reserve to await near-future needs.

      It was also implied that GM wasn’t fully behind the mandate to build ventilators, but it was also said that they had come into line. Trump didn’t seem to be behind the stimulus plans, particuarly unemployment benefits, (“Paying people not to work? That’s not who we are.”) but seemed to be “getting more comfortable with it” given the serious risk of major fatalities.

      Reply
    2. Cat Burglar

      Wyden did something, at least.

      But it was peanuts compared to the bailouts, so as one of his constituents, I wrote him and let him know. I took the Oregonlive story as making a case for how grateful we should be to him and the Dems — and I say what they did was pitiful, almost an insult, compared to the needs of their working constituents.

      Reply
  5. ShamanicFallout

    Yes, I haven’t found out about the Sanders contribution either. I mentioned in a previous comment that Stoller was on Jimmy Dore’s show the other day and said Sanders did nothing and that it was actually Schumer (!) who was responsible for the UI stuff. I am reserving judgment but Stoller called Sanders weak and a coward re the stimulus bill. That particular Dore show is on youtube for anyone interested. Stoller seems to be pretty versed in how the sausage gets made and who is doing what. But he was very angry with both Bernie and Warren

    Reply
    1. urblintz

      I’m of two minds about this. My initial response was intense anger at Bernie for his “yes” vote on the bill, regardless of his “saving” it with his threat to block it. I’m a huge fan of Stoller so I believe much of his criticism. But I also believe that ultimately Stoller is wrong, especially on this specific moment. Why should Sanders help craft a bill when he had already laid out his ideas loud and clear? He certainly owes the Democrats nothing in general anymore, and the dilution of his long stated goals even less. Could he have improved it? I see no reason to believe so. Did he think it good enough. No.

      And still he saved it for them which, politically, is a hell of lot more important than writing it. I do not believe he would ever have been able to stop it or improve it and acted in the only way left. Described as “grandstanding” as if that’s not most politician’s principle occupation.. I guess Sanders has to be “better” to be “equal.” And let’s not forget that post corona (still developing by the minute) is as new a terrain for Bernie as it is for all of us.

      He may be less than we imagined him to be, who isn’t? But Bernie’s the ONLY one left and his ideas are not radical anymore. Clearly they can all be paid for. As Nathan Robinson points out, everything is different now…

      and Biden will not be the nominee, imho.

      Reply
      1. Dune Navigator

        I thought Stoller’s analysis missed the point: Sleepy Joe Biden and the corporate media are running against Teh Drumpf, Sanders is running against Teh System. Accordingly, Sanders has a much higher bar to clear, particularly with the low information voters. That said, Sanders seems to be folding. Stages of Grief for the self-deceived and shepherded.

        Reply
        1. Noone from Nowheresville

          But do you think Sanders is really trying to change the system or he is simply calling out the immorality of said system?

          Reply
        2. ShamanicFallout

          Yes. And there is also something to remember about Matt’s POV on this as well. I think he sees a lot of this in terms of power relationships and the exercise of power. I have heard him say a number of times that basically the Democrats do not want to wield power (for whatever reason). Especially compared to the Republicans.

          Reply
    2. Noone from Nowheresville

      I thought that the one of the most insightful bits toward the end that Stoller had was that people generally like who they pick to represent them.

      I find that when I talk about policies. Here’s the dem example

      You hate such and such policies under Bush, well this is what it looked like under Obama. It’s worse.

      There’s a little back and forth but what it comes down to and has even been said to end the discussion:

      but I like Obama.

      When talking the primary this year: I had similar discussions. I “like” so and so Then they repeated the campaign slogans like the phrase that used to ear wig from a radio station self-promotion ad: WFKU Sunshine in the Morning.

      Reply
    3. Oh

      Initially, I was outraged that Sanders had not blocked the bill but after thinking about it, I feel he should’ve asked for more than just 4 months unemployment compensation. If he had asked for a lot more, such as UComp for the unemployed until they found another job and payments of $2000 per month for as long as CV was a problem, etc., he might have been able to negotiate with corporate servants in Congress. This would’ve turned the tables on them. It looks like “the squad” also fell for the trick where not voting for the bill would’ve have put them in the pariah class.

      Reply
  6. richard

    I am sure I am not the first to note this, but calling this cluster of giveaways with some tiny checks to citizens a “stimulus” package is truly insulting. What tiny % of these trillions will actually be put into service “stimulating” the economy?

    Reply
    1. Noone from Nowheresville

      Nice relaxed interview. AOC has charisma. Concise explanations. Still connected to her roots. Very sharp. Would appear that Maxine Waters has taken AOC under her wings for grooming. Deployed TINA.

      Reply
      1. Noone from Nowheresville

        The other big thing which I forgot to add is:

        When calling to say you can’t pay your mortgage, cell phone bill, etc. you must use the phrase because of the COVID virus I can’t

        or something similar. How AOC phrases it is toward the middle of the interview

        There is also good information on student loans.

        The caveat to all this is how it works in real life may be different than what AOC believes is to happen. So always dot your i(s) and your (t)s to protect yourself.

        Reply
    1. JBird4049

      IIRC, I read a news story about Governor Newsom complaining about California’s inability to reprogram the computers or have the bureaucracy complete the paperwork needed to increase the unemployment by six hundred dollars in a few months, never mind a few weeks. So, counting the votes is the least of problems.

      Reply
  7. lb

    If you think about it, one of the most remarkable features of this whole ongoing debacle is that even after the last Crash, the Federal Government still does not have a simple, universal way to send every eligible resident in the country money.

    Smart people writing legislation (good: Wyden for unemployment, bad: malicious/unscrupulous/greedy lobbyists for industry) were immediately ready to throw text into this thing. How else do we get to 800 pages in short order? One of my myriad initial complaints of this piece of … work … was that there wasn’t even any provision to plan for future payments to the public. Why not tuck something in saying that some particular agency will be funded to prepare for later universal emergency payments to all adults, to streamline for future need? This omission is especially galling given the stated expectation of further money to be sent to the public later.

    So, while I and many others are lucky enough to work from home for the next four weeks, perhaps one of our more responsible congresspeople can draft this sort of thing up in plain, thoughftul language, assemble colleagues who agree, and at least start to build something non-stupid for next time.

    Reply
  8. fnx

    Sorry if this has been covered already, but am behind on my reading…what about all of the people who have court ordered debt judgments against them? Any non-exempt money deposited into their bank accounts automatically gets rerouted to whoever. It’s great that any money owed to the feds – except the child support that is – won’t affect the amount sent to you, but with millions of people who ended up over the last decade having bottom dwelling third party debt buyers getting judges to grant them victories without offering any sort of proof the debt is valid, I can see that the world of hurt is going to continue for far too many people who will desperately need the help.

    Reply
  9. sd

    Unemployment in California

    I freelance.

    My last day of work was Monday March 16. I filed a new claim on Tuesday, March 17. When I went to use the EDD website, it bumped me to a paper claim. I printed out the claim, filled it out and put it in the mail which was picked up on Wednesday, March 18.

    It was public knowledge that thousands of new claims were being filed in the state, so I fully expected a bit of delay to opening the claim.

    Saturday, March 28, I received my first claim form in the mail. It would be an understatement to say that I was really impressed with EDD. It could be that because I am in the system from past years, that my claim went through quickly. Even still, there was a tidal wave of new claims and in my view California delivered.

    Next step will be how quickly funds come thru and for what amount.

    Reply
  10. The Rev Kev

    I saw the debate that now seems forgotten between those that wanted to send a one-off $1,200 cheque and those that wanted a stipend for several months until the worse of the pandemic had passed. It had not escaped my notice that with a one-off payment, that this would force workers to go back into the economy after one month whether the pandemic had passed or not as the need for money would be intense. If you are a person that believes that the economy must not be shut down because reasons, this would be a good way to get workers to participate whether they wanted to or not.

    I saw one example of this mentality at work a coupla days ago. This blond woman was sick with Coronavirus and she was in quarantine in her home on Long Island. And yet, instead of having sympathy with poorer people also with this virus, all she wanted to talk about was having those people get sick too so that they could then be sent back to work to save the economy. I guess that her stock portfolio was not looking good hence her intense concern. No word on what the stock portfolio of the workers was looking like.

    Reply
  11. Bill Carson

    So I have a 21yo daughter who lives at home and has never filed taxes. I claim her as a dependent on my taxes. I wonder if she’ll get a check at all?

    How asinine. Why don’t they just ask the NSA how to find us?

    Reply
    1. cripes

      Bill:
      Dependents will not get a check.
      It’s possible you could get an additional $600 on your account for a dependent, provided age 21 still qualifies as dependent.
      Seems like it would.

      Reply
      1. Noone from Nowheresville

        Bill:

        According to AOC in that video I linked to, there’s a hole and no extra $$s for dependents over the age of 16. In order for your daughter to receive a check, she’d have to file taxes for 2019.

        Reply
  12. Pat

    I hesitate to point out that the government gets forms for every dollar paid to people that is not under the table. Said forms have names and addresses. Send a check to everyone who has a W2 or 1099 on file. That does eliminate means checks and ignores most children. And a small portion might see no check and another multiple checks. But I am willing to bet that more people would get the helicopter money with less hassle than we will see with this.

    The unemployment should be corrected to have the additional benefit amount last for four months and extended for x months for any claim started in this year. No dedicated end dates as this will be a rolling wave of job loss.

    But considering I believe most of our political class are upset they had to pretend any interest in providing spam for the masses while arranging massive air drops of Parma Ham to their owners, recognizing simple facts to facilitate spam delivery is too much to ask.

    Reply
  13. McWatt

    In Illinois a friends unemployment benefits came in the form of a credit card last week. The state was very fast in getting the money out!

    However, the state’s money first went to a credit card company, that gets to play the float with the cash, then deducts 2.75% of every transaction on the card plus fees, with the end result that the state has a record of what the money was spent on for all unemployment benefits.
    Nice!

    Reply
  14. Rod

    Day after day, the information service and analysis you are providing–along with the commentariat–is clarifying, sensible and needed.
    this, todays, amalgamation is just another timely marker
    thanks so much.

    Reply
  15. Richard Hayes

    In 2008, we bailed out the major banks and Freddie and Fanny, so now is the time for them to “bail out” main street and mortgagees. Forego loan payments for 90 days. Spread the repayment over 12-36 months, based on the applicant’s choice. Finance rates still aply, we don’t want to have to bail out the banks TOO. Do it voluntarily or maybe Trump can apply the Defense Procurement Act in some fashion. His people are cleaver (and we need that now more than ever) at figuring out how to do the right thing for the American People with the tools already “on the books.”

    Reply
  16. Active Listener

    CARES can’t catch everyone, I guess. I work for an online transcription company and am technically an independent contractor. Customers log onto the company’s website, submit audio files for transcription, and then a pool of people who have (1) passed an entrance exam of sorts and (2) subsequently managed to maintain good job metrics based on random peer grading are given access to these customers’ files. Many customers assume their transcriptions are done by AI, but they’re done by actual people, most of whom live in native English-speaking-nations such as the US, UK, Canada, Australia, etc.

    Most transcribers earn anywhere from $4 an hour to $15 an hour, depending on individual skill, the algorithm-assigned pay rate of a file (which tends to rise as jobs remain sitting in the queue longer), and the difficulty of the file (if a lot of people are talking at the same time, the accents are challenging, or it’s tough to hear the audio, the pace is going to be a lot slower). A file paying 40 cents per audio minute would generate $10 an hour of pay if you can manage to transcribe at a blistering pace of 25 minutes in an hour, which is more or less worth my time in my current situation. However, if it’s tough to hear and you have to go back and listen over and over again, or do lots of research to figure out the correct spelling of the names and terms being used, as we’re generally expected to do, you might only be able to slog through 7-8 minutes of audio in an hour, earning you a pay rate of $3 or $4. Thus, the pay rate for files tends to rise as they sit longer, because it’s not worth taking them on for such low pay (plus the higher risk of making errors that can affect one’s performance metrics).

    None of us have technically been laid off because of COVID-19. We work from home mostly on our computers, so we’re still here to transcribe the jobs that come in. But the part-timers and occasional transcribers are stuck at home now, so they’ve joined the pool on more of a full-time basis, meaning more competition for files. Meanwhile, the volume of business going on in the world has drastically reduced, not to mention the demand for transcriptions, so where there might be 1500 files available to work on at peak hours, now there are 100, and during slower times the queue might be literally empty, or have a couple of jobs at most. The upshot is that a lot of people can’t get access to any work at all, and even those in the “plus” class (mainly full-timers with really good performance metrics) who get first access to new jobs can’t find much to work on because there are so few jobs being submitted, and the pay rates are very low (30 cents an audio minute is common right now) because nothing is sitting in the queue for very long.

    I’ve already seen my income cut in less than half from what it was three weeks ago (25-30% reduction in minutes transcribed, 35-40% reduction in pay rate for the jobs I can get), and it is unlikely to get better. It’s especially sucky because the company finally made some changes about two months ago (increasing prices a bit, creating higher pay rates and other incentives for the most difficult files) that had me earning over $300 a week for the first time in a few years. But because we’re not laid off and can technically work from home, it doesn’t appear that we US-based transcribers will qualify for any of the pandemic unemployment assistance money for self-employed independent contractors. I earned $160 last week, and I’m going to have to live on that type of money for the foreseeable future. This feels, predictably, like people in my boat are just slipping through the cracks a different way. It’s hard to imagine any kind of help beyond direct blanket stimulus payments reaching workers in our situation.

    Reply
    1. Eclair

      Active Listener, thank you for your informative post. NC excels as a platform that allows us to peek inside the worlds of others, whether in jobs that we never knew existed, or in other countries. I wish you the best in these difficult times.

      Reply
  17. Brenda

    About the child support flagging your stimulus check…….what if you have arrears but have been paying on time the amount set by the treasury for ten years? Would one still be eligible for a check?

    Reply
  18. Jp

    Thanks to NC and some of yews guise for this info. lambert left out a link to the circumstances we self employed can collect that 1/2 of the average unemployment and $600 additional per week. As I said before, I am a musician in Illinois, all my gigs and albums have all been cancelled. Do any of you know what the guidelines are? I have called a few of my muso buddies, but nothing, although quite a few had no idea that this was real.

    Reply
    1. flora

      This CEPR paper presents a lot of the guidelines. Published March 26th.

      The U.S. Response to COVID-19: What’s in Federal Legislation and What’s Not, but Still Needed

      March 26, 2020

      This document is based on the two COVID-19 bills enacted by Congress to date—the Coronavirus Preparedness and Response Supplemental Appropriations Act (C1) and Families First Coronavirus Response Act (C2)—and our best understanding of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (C3). This is not a comprehensive summary of all provisions in the three bills, but does include most major funding increases ($1 billion or more) and very large programs. We will continue to refine and update this document as more information becomes available.

      https://cepr.net/the-u-s-response-to-covid-19-whats-in-federal-legislation-and-whats-not-but-still-needed/

      Reply

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