Biden and Congress are setting 'a 5-alarm fire' by letting federal unemployment benefits expire in a week as Delta surges

While addressing the nation from the East Room at the White House, President Joe Biden stops to take a moment. Anna Moneymaker/Getty Images
All federal unemployment benefits programs are due to expire within a week and Congress won't renew them.

Andrew Stettner, an expert on unemployment, says it's a five-alarm fire.

"Now, we are putting people in danger." He said that this would cause a lot of harm to people.

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In exactly one week, federal unemployment benefits from the pandemic will end. According to the Century Foundation, 7.5 million Americans will lose their benefits completely. This is an unprecedented fiscal cliff which will have a significant impact on incomes, spending and the lives of jobless workers.

Andrew Stettner is a senior fellow at the Century Foundation and a jobless policy expert. He tweeted that it was "five-alarm fire."

"Most people live paycheck-to-paycheck, and starting next week they're not gonna be able to count on a regular source of income. Insider reports that they will be in danger.

Insider has heard from jobless workers that they fear the end to their benefits. The Delta variant is on the rise, threatening plans to return to school and work. Some may lose their income, which could affect their ability to remain in their homes. The Supreme Court ruled last week that a temporary eviction moratorium was in effect. This allows local courts to resume evictions that have been stopped.

According to the Census Bureau, 7.4 million renters now face the risk of being evicted. The People's Policy Project estimates that 20 million Americans who are jobless will see their incomes drop as benefits end. Both cases could see people at the mercy local action.

Washington doesn't want to extend the deadline, but other states might.

The Biden administration stated in a letter to Treasury Secretary Janet Yellen, and Labor Secretary Marty Walsh that federal benefits will end as planned in September. States can provide benefits or issue periodic relief payments to jobless workers who are being cut off. However, the Biden administration made it clear that states could step in and provide benefits.

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"To adequately address continued claims payments for those who are not eligible for unemployment assistance, or those facing the completion if available claims weeks," Insider was previously informed by a spokesperson for Washington's governor.

However, Congress is not pursuing a renewal in federal jobless assistance. As they begin drafting a $3.5 billion spending plan, Democrats are largely excluding the issue from their discussions. Republicans are strongly opposed. 26 mostly GOP-led states cut off some of the jobless benefit programs months prior to their expiration.

Sen. Joe Manchin, a key Democratic moderate from West Virginia, has already voted against it. This could threaten an extension in a 50-50 Senate. Each senator must support the party line package to clear the Senate in an arduous reconciliation process.

Rep. Alexandria Ocasio Cortez, a House progressive, said they are currently discussing whether to push for an extension. It would be difficult to achieve this given the resistance of Democratic centrists, Speaker Nancy Pelosi's insistence on creating a spending plan that can withstand wafer thin Democratic majorities in both houses.

White House officials stated Monday that President Joe Biden decided not to press Congress to renew benefits due to the economy's recovery. Jen Psaki, White House press secretary, stated that "I believe he made an assessment of where things stand in the economic recovery at this time."

She stated that the administration was focusing on ensuring that people have access to state relief programs as well as the revised child tax credit. The child tax credit provides cash payments that can reach up to $300 per month, depending on the age of the child.

"This will cause a lot of harm to people."

Some workers will be left in a difficult situation due to the benefit cut-off. Insider previously reported that Amanda Rinehart is a Pennsylvania mother currently receiving federal benefits. She is high-risk for COVID and will stay home with her child as he begins another year of virtual schooling. This means that she won't have the opportunity to return to her beloved hospitality job.

Rinehart stated, "I honestly don't know what I'm going do financially moving forward without these unemployment benefits."

Experts also believe it is too early to end unemployment. Research on states that opt out of federal benefits early has shown a $2 billion drop-off in spending. Researchers estimate that this could lead to an $8 billion decrease in spending between September and October.

Stettner stated that losing a job can be very damaging to your financial and personal health. "We have avoided some of these damages over the past 18 months. Now, we are putting people in danger. This will cause a lot of harm."

Do you have a story about unemployment or are you an unemployed worker? Contact these reporters at jkaplan@insider.com and jzeballos@insider.com.

Business Insider has the original article.

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