$400 Unemployment Start Date Might Be Much Later Than White House Thinks

The latest unemployment benefit plans of $400 per week are dividing experts and politicians, with Larry Kudlow commenting that he believes that they will be available in two weeks.

The White House economic advisor told Fox News on Tuesday that the Department of Labor expected the enhanced unemployment checks to go out in around two weeks. "The baseline of unemployment from states is roughly $400 per person per week, that's the median," he says to Fox News' American Newsroom. "On top of that, the federal government is going to put in $300. ... We will work with [governors] if there's any complications."

The new unemployment benefits were announced by President Donald Trump on Saturday. He directed the Federal Emergency Management Agency (FEMA) to assist in providing benefits from the Department of Homeland Security's Disaster Relief Fund (DRF), which has over $70 billion available. State governments have also been instructed to use their Coronavirus Relief Fund (CRF) allocation, to aid Americans who are suffering from unemployment due to the COVID-19 outbreak.

The benefits proposed are set to give $400 per week to Americans who receive $100 or more from the following:

  • Unemployment compensation, including Unemployment Compensation for Federal Employees (UCFE) and Unemployment Compensation for Ex‑Service members (UCX)
  • Pandemic Emergency Unemployment Compensation (PEUC);
  • Pandemic Unemployment Assistance (PUA)
  • Extended Benefits (EB)
  • Short-Time Compensation (STC)
  • Trade Readjustment Allowance (TRA) or
  • Payments under the Self-Employment Assistant (SEA) program

The federal government is set to pay $300 per week to claimants with state governments paying the extra $100. However, according to the National Employment Law Project (NELP), the Administration will allow state unemployment insurance payments already paid to claimants to count as the $100 per week, meaning that in reality there will only be $300 in supplemental funding—a reduction of 50 percent from the previous benefits of $600.

"Egregiously, the Memorandum excludes workers whose state benefit is below $100, a senseless policy that will disproportionately hurt people of color and underpaid workers," NELP says in a statement.

Kudlow's estimations have also faced criticism from other experts. Speaking to Newsweek, Gary Burtless, an economist and senior fellow from the Brookings Institution, confirmed that based on previous benefit changes it could take a while for systems to be up and running. "As experience from mid-March through early June showed, it will take some state unemployment insurance systems a long time to re-program their benefit payment systems to accommodate this change," he explains.

Another economist, Eliza Forsythe, who is also an assistant professor at the University of Illinois at Urbana-Champaign, says to CNBC that implementing this new system is not "something that's going to be quick."

"I don't think anybody knows how long it will take, but it's certainly not something any unemployed person can count on within a few weeks," she comments.

Getty Images Food Bank New York
People wait in line for food assistance cards on July 7, 2020 in the Brooklyn borough of New York City. A report issued by the Center for New York City Affairs last week noted that the city's unemployment rate surged from an historic low of 3.4 percent in February to 18.3 percent in May, with the analysis pointing out that the rate would be an even higher 26 percent in May if unemployed workers who haven't looks for jobs during the pandemic were included. The May umployment rate is twice as high for Black, Latino and Asian New Yorkers as for White New Yorkers. With the $400 per week unemployment benefits having no delivery date in sight, experts are concerned these communities will be hit harder. Spencer Platt/Getty Images