Senior economist at the nonprofit Upjohn Institute for Employment Research in kalamazoo, michigan. Christopher oleary, lets work away backwards. Can you explain what president trumps executive action when it came to unappointed insurance he signed this weekend, what it did in how it compares to what was offered under the cares act . Guest good morning, john. Thank you for having me on. Pleasure to be on washington journal. Certainly i can address the executive order. I read it. Theink i understand objective. Up and talke back about this whole idea of supplementing unemployment. It is interesting. There have been eight recessions since the eisenhower administration. Every one the federal government has extended the duration of regular state on employment insurance benefits. There was a modest additional compensation added during the Great Recession in 2009. 25 added. Check. D to every benefit it went largely unnoticed. Recognized the existing unappointed insurance system is inadequate in many ways. In particular in terms of income replacement. , think the executive order lets hope it was an effort to bridge the impasse. 600 lumpsumhe made a lot of sense in many ways. Reasons andlot of very little negative affect found in research from it. A lot of positive effects in terms of social distancing and income security. The executive order, i dont know it has standing. I think the house in the ways and means committee, representative neal has the purse strings. Athink they will be involved some point before this thing gets resolved. The president proposed something modeled on the disaster unappointed insurance program, an emergency program. Bill, the cares act inc. Something inc. Unemployment insurance. Disaster Unemployment Insurance requires emergency decorations. The current arrangement is similar. Waspresident s proposal 300, which was the last bargaining position out of the senate on this. Bes said 400 would sufficient. He is counting on in the executive orders to pony up the extra 100 per check. Benefits, laste week there were 17 million checks passed out. 100. That is 1. 7 billion per week. The states are already facing difficulties paying the regular benefits. 19 states have applied for loans from the treasury. 11 have received advances from the treasury. Level of preparation going into this, the state reserves are being depleted. Remember, john, the worst ever week of Unemployment Insurance was aboutthe history one million a week. Day, after st. Patricks that week there were 6 Million People claiming benefits. That is a staggering difference. That persisted for a couple of weeks. Finally dropped to about 3 million. Now it is running about 1. 5 million, greater than the historic high ever. The system is paying out benefits. It is doing its function to a large extent. I read it carefully, the president s proposal. I was disappointed to see the president s supplement would not provide any benefits to people with weekly payments under 100. I asked myself why. The unappointed Insurance Programs serve many people. I have done a lot of work on the relationship between Unemployment Insurance and public assistance, food stamps. People who get a little bit of unappointed insurance really helps them avoid sliding into poverty. Who are lowwage workers or parttime workers and may qualify for a lowlevel benefit, and may qualify for a lowlevel benefit. Benefits can be as low as five dollars a week in some states. Many states it is 50 per week. Why would we exclude them . The supplement is giving people security. It is promoting social distancing and helping tamp down the virus. Me, to end o september on december 6. I hope i addressed some of that. Host we want to talk to some of those people you are referring to and invite those folks to call in. A special line if you are unemployed, 202 7488000. We want to work you into this conversation. Business owners, 202 7488001 is the number. All others, 202 7488002. Andep dive into federal state Unemployment Insurance this morning with Christopher Oleary of the Upjohn Institute for Employment Research. Can you briefly explain who you are and how long you have been around . Guest sure, thank you. This year is our 75th anniversary. Upjohn institute was established in 1945 right after the war. It was established based on an endowment. The founder of the upjohn drug up a month before he died. Dr. Upjohn grew up on a farm. Ofthat time it was a period transition from a farm economy to an industrial economy. , amployment insurances program for an industrial economy where people are separated from the land and the means of subsistence. He set up a farm outside of kalamazoo where people could set up a garden, maybe build a cottage, grow crops. They had some assets that were put into the endowment. Some people did use it as that. Some people got grants. Then the institute operated as a grantmaking foundation. It was finally created as an institute for research in 1945 to study on and ways of dealing with unemployment. That is about the Upjohn Institute. Host Christopher Oleary, senior economist. You have spent a lot of time studying unemployment. When it comes to today and what is happening now with the pandemic, how Many Americans are currently receiving some form of Unemployment Insurance, whether from the state or federal government . Guest last week, the report comes out every thursday morning told us that 31 Million People were continuing claimants on on appointment. 17 million were regular state beneficiaries, state programs. There were about 13 million on the special pandemic unemployment assistance, which is available for selfemployed, gig, and contract workers who dont qualify for regular state benefits. There are several categories. You might not meet the eligibility requirements if you are at home taking care of kids who are in school. You could qualify under pandemic on employment assistance. Unemployment assistance. There are about 13 Million People receiving that. 31 Million People is a staggering number. A fifth of the workforce. Host do we have a total of how much has been spent on Unemployment Insurance additionally because of the coronavirus pandemic . Has anybody totaled that of yet . Recessionng into this there were about 76 billion in reserves. That was enough under recent 1. 6rios to pay about billion a year. 18 months, 19 months of benefits. Given the rate of payout is about three times the worst ever, that reserve level is evaporating in about seven months. Almost every state will have to borrow. Right now there is zero interest being charged on loans to states, at least through december 31. I think any new legislation needs to address an extension of the interestfree period. Injected 100 hundreds of billions of dollars into the economy. A major reason why we have not slipped into a worst recession at this point. Host we would like to chat with a few callers. Plenty for you this morning. Christopher oleary with us until 9 00 a. M. Vegas on the line for those unemployed. Good morning. Caller good morning. Host you are on with Christopher Oleary. Caller i am unemployed right now. Now i dont know if this is a good idea but should they give mandatory stimulus checks to people who are billionaires and they should give nothing to people who are unemployed . Guest thank you for your question. What you are talking about is the payroll Protection Plan and the comparison between the payroll Protection Plan and the Unemployment Insurance. The payroll Protection Plan, i have heard numbers about that. 99,000 perabout person to maintain jobs under the payroll Protection Plan. Anybody with income over it will pay all employer expenses. The money can pay for rent, utilities, the cost of Health Insurance. If you think about the Unemployment Insurance i think the payroll Protection Plan was a way to insulate people from slipping into the unemployment programs. Everybody had to rely on the programss, more people would realize the need to improve the programs. If you think about the Unemployment Insurance program, even with the 600, given the average weekly benefit is about rehundred 75, you are talking 375, you are talking about 1000 a month income replacement on average, which is someone making 52,000 a year. Which is a workingclass person in America Today who has real expenses and real bills to pay and concerned about going out into the virus and wants to avoid transmission. Ingeniousenius to give people adequate security. I think if everybody was looking at the Unemployment Insurance system as their means of support during this crisis, instead of maybe Something Like the payroll Protection Plan which has been suggested some very wealthy people have benefited from, i think we would all have more interest in maintaining an adequate replacement throughout employment insurance. Thank you. Host alexander on the line for unemployed americans. Daytona beach, florida. Good morning. Caller i have one question. Do you have information about the state of florida or who i can contact . I was locked out three weeks ago and i have not received anything. I called every number i can. Emailed. D i they say i am locked out. When i talked to the agency handling system, they said you have to wait until they contact you. Yeah. Thank you, alexander. Excellent question. We have been studying systems for 70 years here at the Upjohn Institute. We looked at with the condition of the under flame insurance system was before the crisis. The Unemployment Insurance system was before the crisis. It varies between about 11 or 12 of all unemployed floridians getting unappointed insurance to about 52 of new jersey residents who are unemployment getting benefits unemployed getting benefits. There are other states clustered at the low end. Several states in the southeast have very low recipients he rates. Recipientcy that meant those states were particularly less prepared to handle an influx of claims. It is not surprising the system is slow. I think you should not give up. If you have numbers you can careeronestop. Org and they will help you. Please keep calling. Dont give up. If you bought something on the internet and you had a problem returning it, you know it is hard to get through those people. Sometimes you have to sit and wait for hours. You have money on the line coming back to you. From the date you first are separated going back at least 12 weeks, you should be able to be retroactively paid. Having difficulty getting through the system, keep trying. Act,ilys first pandemic first stimulus bill had 1 billion for state administration. That was the first thing put on the front line. We are going to need the Unemployment Insurance system. We want to fund the administration, but it is hard to do it overnight. I think florida is trying to supplement temporary staff, improve computer systems. You just need to keep trying because that lump sum will help you get through this crisis. Numbers get a lot of and try to sort through them for the viewers. You talked about the more than 30 million americans who have received Unemployment Insurance throughout this process. Can you square that with the monthly unemployment report that 16. 3 unemployed persons in this country. How does that work . Guest they are based on different data. The undiplomatic insurance is claims data the Unemployment Insurance is claims data. I think close to 50 Million People have applied for benefits. I think 40 Million People have received benefits at some point since midmarch to now. There are still 31 million unclaimed. On claims. , they useoyment rate a monthly survey. They interview people during the week with the 12th of the month and the week. Are you available or actively seeking work . They will classify u. S. Unemployed you as unemployed. You have to answer affirmative to all of those. There is some slippage just in the timing of the thing. At this point i think a more reliable measure of the stress and the economy is the unemployment numbers. If you try to get numbers, john, at the local or in many states, small states, the numbers are based on the Unemployment Insurance claims. The unemployment numbers. They combined census data and Unemployment Insurance claims data. They have about 40 applications to go through. Butnt tell you exactly why there are different methods of gathering data. I think there is no question it is a serious crisis right now. Host we have the line for business owners. Tony is on that line from missouri. Good morning. Caller good morning. Host turn down your television so we can hear you well. Caller yes. I am a handyman service. I work on referral. My business has not been affected so much by this pandemic. I see a lot of businesses that have been affected. I see how it is working. How all of this beneficial money is working against those businesses. The employers are laying off the employees so they can collect the large check every week instead of the smaller check the business pays them. They are working on parttime so they can collect a parttime paycheck and a fulltime unemployment check. On occasion i have to have people help me. I dont keep fulltime employees but it is difficult to get people to work now with this free money. Opinionrious as to your on that. Host thanks for the call. Christopher oleary . Guest thats a very important point, tony. I want to thank you. You are one of the essential workers out there continuing to serve the public during this crisis. Toam sure when you go in provide your service at a business or a home you are trying to practice social distancing. Know, it is a challenge for all of us. But not every business operates one on one like you do. Some businesses, even Small Businesses have several workers in a very close space. Workly, by using the sharing program, an employer could reduce hours for everyone in the workplace by 50 . Everybody continues to get paid half their wages, but there is enough space in the workplace for them to avoid social contact. They get half of their own employment benefit. Instead of getting 400 unemployment benefits, they would get 200. Plus, during the period up to july 31, the 600 extra. Owner, instead of laying half his workers off completely and operating, he keeps everybody on. They get their benefits and maybe Health Insurance and other things, and they would also equally get supplemented. In this period where we are not interacting we have to be at home. We are insecure often at home. Frankly, i would not be surprised if your business benefited from people having a few dollars to repair a few things about the house. Is always more than one way to look at things. I wish you well in this crisis. Host vancouver, washington. This is albert on the line for those that are unemployed. Good morning. Caller good morning john and christopher. I had a question regarding what employers pay. I am unemployed in washington. There is a huge debacle in the state. Anybody politically astute nose it was knows it was hacked by to 1igeria group up billion. They shut down unemployment for hundreds of thousands of washingtonians immediately upon investigation, which has been a travesty. You could go on facebook. There is a support group. Upwards of close to 20,000 participants. Whatcurious about an employers pay into unappointed insurance. I am 58 going on 59. Is it based on the number of employees . Are they multinational . Small business . What the right is . Does it vary from state to state . Anytime you offer a system that will pay someone 600, you will get some outliers, right . They will be when you include a lot of different people, the parameters changed dramatically. That is a big assumption just go back to work your job. There is a huge divide as to what the pay rate is when you do work state to state. It is no wonder people would say i will collect the 600 because i work hard and i get paid very little. At 59, i have worked since 16. I have a tremendous work ethic. I have done right by the entire system and i lost faith incredibly in america during this pandemic. The variety of systems that have failed the constituency. The guys in d. C. , pick a side of the aisle, i dont care. When they are bickering americans are suffering right now. We are getting this pittance from the state. Those guys in washington continue to say i will take a threeday weekend, for perhaps taking a full week off again. It is astounding and saddening. Host Christopher Oleary, go ahead. Guest you put a lot of things on the table. Number one, thank you for calling in from vancouver. Thank you for being s up so early in the morning. Vancouver, washington. I have been there and worked in Washington State. Ive had several Research Projects stating back to the 1980s. Washington state has one of the best Unemployment Insurance systems in the nation. Scam claims, ok, in 1980 when we ran some employment bonus experiments, and there is a difference between the bonus would you give people cash after they get to work off of unemployment and what some people are calling the extra 600, which is not a bonus, its a supplement. To file your days claim for benefits in Washington State you had to walk into the office and sign a register. Frequently they would give you the payment and cash, in dollars at the teller window. You could get your payment right there. He would bring in a form and state i searched for work. You would sign it. I would contacting the employers. There was a lot of control. Washington is a big state. There is a lot of rural areas where it is difficult for people to get in. That led to more automated mechanisms for applications and benefit processing. We are in a Cashless Society now. The first step was to give people cards where the cash was loaded. That could be cumbersome. If youre getting 600, you dont want it on a card. You wanted in your account through direct deposit. With the automated application system and direct deposit, there is fraud possibility. There is pressure on the on claimant system to pay benefits on the unemployment system to pay benefits. Setfornia in the 1970s the standard for payments. There is a difference between assessing eligibility and knowing for sure before you pay the benefit. The court said even of the state has not figured out your eligibility, they cant wait forever to figure out your eligibility. They have to pay on a presumptive basis and then expect he will reimburse if there was fraud. If they are in nigeria or russia or where they are. They could be in United States. They use these automatic claims. There is a lot of effort to prevent that. That could be one of the reasons why states are bulking at some of the more complicated baulking at some of the more complicated efforts. You start doing a wage replacement formula and so forth, there is a lot of automated checks in the computer programs to look at what is going on and what is coming in. Triggersd set up those and prevent checks from going out. Caution onstand the the part of the state agency in olympia to watch the payment. If they identify a serious problem and shut it down. Ithink as part of the reform, think we will learn a lot of lessons. I think the administrative processes have to be one of these things. Should i address the other questions that albert raised . Host we have a lot of calls and only about 20 minutes. Guest maybe we will get back to those. Host harry from winterville, georgia on the line for those unemployed. Good morning. Caller good morning . Host you are on with Christopher Oleary. Caller i have been out of work since march 13. They sent in email out saying we could not in for unemployment. I am a bus driver. Supposed to go back to work on august 3. Now they are saying we will not go back to work on august 3 but they will let us put in for they have us set up for september 8. And we will file a partial unemployment. I asked, what date would you start . They said it would start august 3 for unemployment. Pay ofleica subsidence 700 on the 15th and 30th of the month. Witht paid two times, taxes and every thing. You are living on less than a thousand dollars a month. Us, their buside drivers were allowed to call in they were mandated to pay unemployment. They got the 600 per week. In the state of georgia, they want to open the schools up but they still have all the other things shut down. Banks are shut down for long lines. Poor people like myself, at least i have a phone. They cannot sit on the line waiting for phone calls, especially when they have a minute phone. They have the Unemployment Office closed, but they are rushing to get the schools opened up. Being opened up for people who need it . Host thank you for telling us about your situation. Christopher oleary . Guest harriet, those are all great questions. Thank you for your service as a bus driver. Harriet sheif mentioned another county. Sense it is ahe municipal operation. The transports are municipal operations. I can understand the reluctance of any employer to have Unemployment Insurance benefit payouts. Normally it affects the tax rate. That is part of the question that albert was raising. Employers reluctance to let people have access to benefits. Any mystical agency that puts people on unemployment is getting a 50 reimbursement of the benefit charges. If the tax rate would be affected, it would only go up partly what would normally go look. Go up. It is a way to get people security. I think she sees a bus driver in a neighboring county and says that county administrator was more true in using the features of the cares act to help workers. Harriet, like also, your administrator figured out when you returned to work you will be getting unemployment, at least part unemployment. Extension of the supplement is continued, you should get that fully regardless of if you get a fractional unemployment benefit. Maybe those county administered his got together and figured out to use the Unemployment Insurance system. We go back to the scale of this problem, go back to the achieving social distancing. Harriet is a frontline worker. People to help these continue to provide services when they can in a safe way and recognize it. Helping them through the Unemployment Insurance system, maybe with a Workshare Program and the supplement is a good way. Andeed to look at wages, also employers have complained they cant get people to come and do some of these jobs. Let me remind our listeners that july, the last time. He minimum wage was increased it has not changed. There are 30 some states that have higher minimums than that. There is very little evidence of employment effects. When we hear senator romney talking about a supplement to encourage people to go back to doing essential jobs, thats a very important thing. What about the minimum wage . That will raise all boats. Host back to the line for business owners. Paul of lady lake, florida. Caller good morning. Thank you for the time you have spent educate us here. I am a business owner. I certainly benefit from sharing control with the government and filling out these humongous paperwork forms and bank forms to get big dollars into my business account, which i then dole out to others. True eachto me, is it 1 trillion approved, if divided equally into the 100 million family units would be 10,000 per family unit . Fundedtrillion already and annal additional 1 trillion trump approved is 4 trillion. Wanted 3umer trillion for new heroes payment. Four. Plus one is equal to three plus three is equal to six. Cutting out administrators and researchers means every person listening to my voice would wake up tomorrow with 40,000 or 60,000 new dollars in their bank account. Such money would circulate and stimulate all. Money is spent more than once. Each recipient, whether business unemployed,loyee or chooses to spend the money based on freedom, individual choice, and personal responsibility. Would that not be an effective way, a more effective way to begin to stir the economic pot . Host thank you for that question. What kind of business do you own . Caller software analysis. Where do the 40,000 per family unit go . To pay administrators . To researchers . Mr. Oleary, and dont take this personally. This is the all the mr. Olearys and paid administrators and congressmen and senators. Do you benefit financially by this route goldberg contraction . Dberg contraption . Guest often in simplicity you are obscuring some of the facts. You have a little understanding of the keynesian multiplier, which you are actually right. When people get money in their pockets. That is why we applaud the mechanism of the Unemployment Insurance benefit. The people who get those thears, as compared to thesstheboard rebate, people who are working people who get the dollars are certainly going to spend it. I think you are right. Haslevel of spending definitely kept the economy afloat. If we listen to dr. Fauci, we know even the first wave has not passed over the country yet. There could be a second wave. I think that is why we are at the junction where we are saying now is the time to use that resource. Saidfed chairman powell there is still a role for fiscal policy. You are an educated man. You are a keynesian and you know about the multiplier effect. Chairman powell has said now was not the time to stop. I think that is the first topic that john invited me to talk about. Is it right to continue this . I think yes. Your business will benefit. I think your business has probably been busy during this period and thank you. Host 10 minutes left with Christopher Oleary of the Upjohn Institute, senior economist there at the nonprofit, nonpartisan Upjohn Institute. Ductwork. Ne, upjohn upjohn. Org. Ray out of phoenix, arizona. You are next. Caller thank you for having me. Host go ahead. Caller i work for a major airline. There are only four left so i dont want to give it away. I am actually really worried. I am rooting for the cares act, whatever you want to call it. And peoplei have, are criticizing helping the airlines, it has helped people stay afloat. D keeps me off unemployment. It keeps me off unemployment. Am warylaid off, i about how to make ends meet. I will probably lose everything i own and so forth. I was wondering. How do you feel about helping get the airlines . Is it fair they help us even though we are essential workers . Host Christopher Oleary on the airlines . Guest i think the airlines are essential. Ever since 9 11 there has been a winnowing of the airlines. Its an essential industry for the United States. The question i have is the income replacement. If there could be some kind of arrangement where there are payments to maintain benefits but allowing airline employees to receive unemployment and making the unappointed benefit adequate. I know some airline employees are wellpaid, and some are highly paid. There are social standards for the income replacement. If you are in the airline industry, is there any sense that should i be getting 100 of my salary . While other people are getting a fraction . Chevy all be in the same boat . Should we all be in the same boat . Maybe if we built the boat stronger, everybody would be better off and get through the crisis. Thank you for your service. Its a very essential industry and part of the key economic recovery. Thank you. Host when we look at the heroes act, is there anything specifically in their for the airlines in there for the airlines . Guest i dont know all the details of the heroes act. It is an enormous bill. I would not be surprised if there was something for the airlines. I dont know the details on that. Host linda out of falling waters, west virginia. Caller how are you this morning . Host you are on with Christopher Oleary. That i my comment is have worked all my life. At the factory i worked at. They just put us all out because they did not want nothing to do with this. There were maybe 10 of us that got hurt. Anyway, i have all these restrictions because they took my i have all these restrictions. I finally got a job. I worked there six years. I was making eight dollars an hour. Then they shut us down. My employer could not afford to open back up. She did not have the money. Week on employment unemployment. At least i have a husband that is an essential worker and i get social security, which is only a little over 1000. I feel bad for these other ladies that are working there that was not getting on employment. Was not getting social security. I feel bad for people who cant pay their bills. There are a lot of people down here living intense because in tents because they dont have the money to keep their house. It is really sad. Host thank you for your call. Guest i want to thank you for your call. And your resilience given the challenges you face. I am happy to hear you are receiving some unemployment. I hope this supplement comes through and will help you in this crisis. He requirements for eligibility unemployment of of unemployment have to deal with able and active work. Meaninge requirement, you are healthy and sound, has been somewhat suspended because of the covid crisis. Forced intoever be accepting a position where you are at risk of getting the illness if you are in frail condition. For her story and recognize she is one of those cases that under the executive order would have been excluded by the 100 minimum limit. 6, whichires december is a particularly surprising day for expiration of an extension. I think the extension needs to be through at least the end of the year, and then a reconsideration. I think the 600 was a genius level. It is clean and simple and states have been successful in implementing it. Even if there can be a compromise on the 400, that will be a doubling of the benefit for most people and make a difference. If the congress or senate coast home before this has been resolved for recess, i think they will have difficulties in their districts. I am not a politician but that is just my take on this. Host time for one or two phone calls. Georgia, this is rachel. Good morning. Caller hello. Host go ahead, rachel. Caller i am from miami, florida. I enter saidm the emphasis on paying federal Unemployment Insurance. Knowing how much an investment i is for foreign aid, wondered whether has not been a greater infosys on foreign aid right now emphasis on foreign aid right now when 95 of consumers are outside United States and helping build markets would result in direct host we do talk about foreign aid quite a bit on this program. We are talking about the federal and state unInsurance Programs right now so we will try to keep it to that discussion. Maybe you can try to call in another time. Sean in new york city is next. Caller good morning. How do we intend to pay for these things when you look at the National Debt clock . Our personal debt and federal debt is in the trillions of dollars. When you look at Credit Card Debt and the trillion dollars, total personal debt is in the trillions of dollars, the u. S. National total debt is in the trillions of dollars. How do we think we will fix this . Currente u. S. National debt. Usdebtclock. Org. Guest sounds like a familiar topic for you. You might know more than me. When the last administration left, it was around 12 trillion. Now it is more than doubled. We go back to the idea of the keynesian economics. Also we know the federal borrowing rate is less than 1 . 6 for longterm debt. You can pay it back in 30 years at. 6 . Sounds like a good idea to transfer that spending from the future to now. Lets remember this is not a zerosum game. When we take something, that does not mean when we get something we are not just dividing up a static situation. We can stimulate the economy through the spending programs. The idea is the economy will more employment grows, people have income and there is a bigger pie for more people to share and everybody gets a bigger piece. The idea is in the long run it will all work out. That is the bottom line. Host joseph out of massachusetts on the line for those unemployed. You are on with Christopher Oleary. Caller yes, hello. Good morning. My name is joseph. I am from newburgh, new york. I am a single father. I just got over the coronavirus. I have not returned back to work yet. I dont know what to do. They just stopped unemployment. I really dont know what to do. I have been putting in for it. What should i do now . I am listening to you on the radio or the tv. You said keep applying
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