Outflanked XVII: The Authoritarian Vaporware Outflankening
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Trump’s memo purporting to extend unemployment benefits is an awful program on the merits that is also entirely outside the president’s legal authority:
I wish to focus on the fourth action, purporting to offer unemployment assistance. This is by far the most consequential, practically, politically, and legally. If the President can persuade the electorate that this “takes care of” the unemployment compensation problem, he can relieve the pressure on him and Senate Republicans to agree to some of the Democrats’ legislative proposals.
The President directs FEMA to create a new program using $44 billion in Disaster Relief Funds that would allow states to send an additional $400 per week to people receiving UC, PUA, or other public unemployment benefits. To participate in this program, states – which already face $555 billion in budget shortfalls as well as demands to help struggling local governments – would have to pay one-quarter of benefit costs as well as, apparently, the full administrative cost. The President arbitrarily disqualifies the poorest of the unemployed: those receiving less than $100 per week in regular benefits. Once the program has spent the $44 billion, it would shut down.
With roughly 25 million people receiving unemployment benefits, the $300 federal share of the new weekly benefit would last about six weeks, or until mid-September. In practice, many states’ antiquated unemployment automated systems will take a considerable length of time to be programmed to provide these benefits, to exclude workers with benefit amounts below $100, and to account for them so that the state can be charged its matching share. Some states took as long as two months to get PUA fully operational this Spring. Because the funds are not allocated by state, this likely means that the states that can start this program sooner will be able to draw down the full amount before some states with greater obstacles are able to get started. Realizing this, some states likely will conclude that spending several weeks on a major computer reprogramming project that, once finished, with allow them to pay only a few weeks of aid is not viable.
Finding the required matching funds also will be difficult for states, both fiscally and legally. In some, this will require action by a legislature that has adjourned for the year. And with state budgets already in a holding pattern hoping that federal fiscal relief will avoid the need for deep cuts, many may have difficulty locating these matching funds. Although the President states that $80 billion of the fiscal relief CARES provided is unspent, the great majority of that has been committed in state and local budgets in ways that cannot be undone without creating a further hole or reneging on commitments to local governments (which the Administration has pressed states hard to make).
The one-third reduction relative to FPUC, is likely to increase hardship and shrink consumer spending significantly. So is the complete exclusion of workers with histories of working at or near the minimum wage, particularly in states that pay smaller fractions of prior wages as benefits. Families that were living hand-to-mouth when they were working will not have room in their budgets to absorb these cuts. The reduction is likely to cause more people to fall behind on their rent, mortgage, and utility bills, deepen shortages of food, and force heart-wrenching decisions to take jobs that endanger the health of the worker or her or his family members. The impacts on African-American, Latinx, and immigrant households are likely to be especially dire.
Last, and certainly not least, the President’s actions are unlawful. The Stafford Disaster Relief and Emergency Assistance Act does provide for spending Disaster Relief Fund to pay “Disaster Unemployment Assistance” (DUA). That section, however, comes with two conditions that the President’s program violates. First, FEMA may only provide DUA to those who are not eligible for any other form of unemployment compensation. The President’s program, by contrast, is limited to those who are receiving other unemployment benefits. And second, the statute caps DUA benefits at the amount that state UC programs would allow. The whole point of the President’s program is to pay $400 per week more than those (inadequate) benefits. Thus, DUA would probably be a plausible means of replacing PUA should it expire at the end of the year (if any funds remain) but it cannot replace FPUC.
The purported extension of the eviction moratorium, meanwhile, is a joke — it is to protecting tenants what Susan Collins is to oversight of the Trump administration, a mildly sternly worded letter to HUD suggesting that it would be neat if tenants had some kind of eviction protection maybe. He wasn’t even willing to take actions that were plausibly within the scope of executive power:
The United States has about 110 million renters, and many have been hit hard by the layoffs in retail, restaurants and hospitality during the pandemic. Trump’s executive order does little to help them.
Trump has said many times in recent days he wants to prevent evictions, but his latest executive order does not ban evictions. Instead, Trump calls for Health and Human Services Secretary Alex Azar and Centers for Disease Control and Prevention Director Robert Redfield to “consider” whether an eviction ban is needed.
Trump also didn’t provide any more money to help renters. The executive order calls only for Treasury Secretary Steven Mnuchin and Housing and Urban Development Secretary Ben Carson to see if they can find any more funds to help out. It doesn’t promise more aid.
Many housing advocates and landlords were surprised Trump didn’t do more to help renters. The federal government owns the vast majority of mortgages in the nation through Fannie Mae, Freddie Mac and other entities. Back in March, Congress passed a federal moratorium preventing many evictions, but it expired on July 24. That moratorium covered all renters living in places that had a federally owned mortgage. Many thought Trump likely did have the authority to extend at least that eviction ban, but he chose not to do so.
Trump’s offer to people about to be devastated by his failure to deal with a historic pandemic is “nothing,” and any reporter who portrays it as anything else is either malicious or incompetent.