States Owe Billions Under Trump Plan 08/10 06:25
Whether President Donald Trump has the constitutional authority to extend
federal unemployment benefits by executive order remains unclear. Equally up in
the air is whether states, which are necessary partners in Trump's plan to
bypass Congress, will sign on.
FALLS CHURCH, Va. (AP) -- Whether President Donald Trump has the
constitutional authority to extend federal unemployment benefits by executive
order remains unclear. Equally up in the air is whether states, which are
necessary partners in Trump's plan to bypass Congress, will sign on.
Trump announced an executive order Saturday that extends additional
unemployment payments of $400 a week to help cushion the economic fallout of
the pandemic. Congress had approved payments of $600 a week at the outset of
the coronavirus outbreak, but those benefits expired Aug. 1 and Congress has
been unable to agree on an extension. Many Republicans have expressed concern
that a $600 weekly benefit, on top of existing state benefits, gives people an
incentive to stay unemployed.
But under Trump's plan, the $400 a week requires a state to commit to
Many states are already facing budget crunches caused by the pandemic. Asked
at a news conference how many governors had signed on to participate, Trump
answered: "If they don't, they don't. That's up to them."
Trump expressed a different view on Sunday night, following a day of state
officials questioning how they could afford even $100 per person in additional
weekly payments. He told reporters as he returned to Washington that states
could make application to have the federal government provide all or part of
the $400 payments. Decisions would be made state by state, he said.
Several state officials questioned how Trump's initial proposal would work
and often expressed doubt that they could afford to participate at the level
Trump initially set without using federal funds.
Aubrey Layne, secretary of finance for Virginia Gov. Ralph Northam, a
Democrat, said in a phone interview Sunday he believes it would be feasible for
Virginia to participate in such a program if states are allowed to use money
that's been allocated to them under the already passed CARES Act. He said his
preliminary understanding is that states can do so, but he and others are
waiting to see the rules published.
The better solution, Layne said, would be for Congress to pass legislation.
"It's ludicrous to me that Congress can't get together on this," he said. "I
think it would have been better for the president to use his influence in those
negotiations, rather than standing on the sideline and then riding in like a
Details about the program were confused on Sunday --- and that was even
before Trump's declaration that states could ask the federal government to pay
all or part of the $400 week payments.
On CNN's "State of the Nation" White House economic adviser Larry Kudlow
said conflicting things about whether the federal money was contingent on an
additional contribution from the states. Initially Kudlow said that "for an
extra $100, we will lever it up. We will pay three-quarters, and the states
will pay 25 percent." In the same interview, though, he later said that "at a
minimum, we will put in 300 bucks ... but I think all they (the states) have to
do is put up an extra dollar, and we will be able to throw in the extra $100."
A clarifying statement from the White House said the "funds will be
available for those who qualify by, among other things, receiving $100/week of
existing assistance and certify that they have lost their jobs due to COVID-19."
Several advocacy groups that follow the issue, though, said it's clear the
way the executive order is structured that the federal money will be contingent
on states making a 25 percent contribution.
New York Gov. Andrew Cuomo, a Democrat, called the plan "an impossibility."
"I don't know if the president is genuine in thinking the executive order is
a resolution or if this is just a tactic in the negotiation," Cuomo said. "But
this is irreconcilable for the state. And I expect this is just a chapter in
the book of Washington COVID mismanagement."
In Connecticut, Democratic Gov. Ned Lamont said on CBS' "Face the Nation"
that the plan would cost his state $500 million to provide that benefit for the
rest of the year, and called Trump's plan "not a good idea."
"I could take that money from testing --- I don't think that's a good idea,"
On CNN, Republican Ohio Gov. Mike DeWine praised Trump for issuing the order.
"He's trying to do something. He's trying to move the ball forward," DeWine
Still, he was noncommittal about whether Ohio would participate.
"We're looking at it right now to see whether we can do this," he said.
In Maryland, Michael Ricci, spokesman for Republican Gov. Larry Hogan, said
in an email that "we will wait on new guidance from US Department of Labor
before looking at any (unemployment insurance) changes."
In Minnesota, Department of Employment and Economic Development Commissioner
Steve Grove said his agency is "awaiting further guidance from the U.S.
Department of Labor."
Kevin Hensil, a spokesman for Democratic Gov. Tom Wolf of Pennsylvania, said
"reducing the benefit by a third will make it harder for families to get by and
it places a larger financial burden on states." He said state officials are
studying the impact of the cuts.
In Louisiana, Christina Stephens, a spokeswoman for Democratic Gov. John Bel
Edwards said "Right now we are reviewing the President's order to determine
exactly what the impact to the state would be."
And in Michigan, Democratic Gov. Gretchen Whitmer said in a press release
that Trump "cut federal funding for unemployed workers and is requiring states
that are facing severe holes in our budgets to provide 25% of the funding."
On ABC"s "This Week," Senate Minority Leader Chuck Schumer, D-N.Y., called
it "an unworkable plan.
"Most states will take months to implement it, because it's brand new. It's
sort of put together with spit and paste. And many states, because they have to
chip in $100, and they don't have money, won't do it," Schumer said.
Many states struggled to adjust outdated computer systems to accommodate the
$600 payment, which along with the massive influx of new claims resulted in
long delays in providing benefits. Reprogramming the computers again to
accommodate the new amount could result in similar glitches.
On ABC, Kudlow said that many of those outdated systems have since been
"I don't think there will be a huge delay. Labor Department has been working
with the states. The states are the ones that process the federal benefits
before. So, I don't see any reason why it would be all that difficult," he said.