Wednesday, April 22, 2020

Congress sowed, small business owners reap

During the last full week of March, Congress passed H.R. 748, the so-called Phase III of Congress' response to the corona virus and its economic fallout.

Just before passing it, a debate ensued on the Senate floor about one of it's provisions. In addition to already-existing unemployment benefits, Congress was providing $600 per week to beneficiaries. That works out to $2,400 per month. On an annualized basis that works out to $31,200 per year—for not working at all. Due to the stay-at-home nature of the circumstances, this also meant there was no requirement to look for work either. Over the four months the provision would be in place, this is a total benefit of $9,600 additional for people not working.

Members of Congress may not realize that this works out to more money than many people get paid when they're working their normal job(s).

Several Senators raised concerns about this provision and offered an amendment to “ensure that additional unemployment benefits do not result in an individual receiving unemployment compensation that is more than the amount of wages the individual was earning prior to becoming unemployed.”

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