- Another 2.4 million people filed for unemployment last week, bringing the total count to more than 38 million.
- This comes as President Trump and GOP leaders said they do not want to extend federal unemployment benefits that give everyone an addition $600 a week and are set to expire in July.
- Those Republicans say the benefits disincentivize people from going back to work because many are currently getting more money from unemployment insurance than they would at their normal jobs
- Others argue that the enhanced benefits are an essential part of the broader economic recovery effort because it puts money in people’s pockets and acts as a stimulus.
Unemployment Continues to Rise
Another 2.4 million people filed for unemployment last week, the government reported Thursday, bringing the official total count to more than 38 million in the last nine weeks.
While the newest numbers still support the continued downward trend the U.S. has seen over the last few weeks, that is only one part of a much bigger picture.
Almost 40 million Americans have filed for unemployment since the coronavirus pandemic forced widespread shutdowns. That does not include the estimated millions more that are currently applying for benefits or waiting for their applications to be approved.
Even though more places are reopening and more people are going back to work, those numbers might not be as optimistic as many have hoped.
In fact, continuing claims— which show how many people are still collecting unemployment after their initial application— rose by 2.5 million to a record 25 million. Some believe that is a sign that unemployment is still straggling even as states being to ease restrictions.
While that figure is reported on a two-week lag and thus might not be representative of recent reopenings, it is clear that many Americans are still hurting.
According to a recent household survey from the Census Bureau, 47% of adults said they or someone in their household have lost employment income since March 13, and nearly 40% “expected that they or someone in their household would lose employment income over the next four weeks.”
Now, more and more economists are warning that many of the job losses meant to be temporary could become permanent. One recent report published by the University of Chicago’s Becker Friedman Institute estimated that 42% of recent layoffs will result in permanent job loss.
Debate Over Extending Enhanced Benefits
Despite these growing concerns, President Donald Trump and other top Republicans have said they want to end the enhanced federal unemployment benefits that were laid out under the stimulus bill.
Normally state governments are the ones that give out unemployment, but under the CARES Act, Congress authorized an additional $600 a week on top of that for all unemployed Americans.
However, those extra benefits are set to expire in July. On Friday, the House passed a $3 trillion stimulus package that would extend those benefits until the end of the year, but Republicans have broadly rejected a number of provisions in that bill.
According to reports, Trump privately expressed his opposition to extending those benefits during a private meeting on Tuesday.
The next day, Senator Majority Leader Mitch McConnell (R-KY) reportedly said that the enhanced unemployment benefits would not be in the next stimulus bill, and added that Republicans are “going to have to clean up the Democrats’ crazy policy that is paying people more to remain unemployed than they would earn if they went back to work.”
That pretty much sums up why Republicans want to end the benefits. They believe that if unemployed people are getting more money from unemployment than they would normally, or even if they are just able to get by existing on those benefits, then they will not go back to work.
There has been some anecdotal evidence of companies saying they are having a hard time getting workers to go back to their old jobs. Although, according to reports, some workers say this is because they are concerned about unaddressed safety issues.
But here’s the thing: legally, people who are offered reemployment and turn it down are likely to lose their unemployment benefits.
That, however, puts employers in a tough position because they have to make hard choices about keeping their business afloat and rehiring people who might be better off on unemployment.
This is true for a lot of people. While some studies estimate that about 40% of workers made less at their jobs than they would get from the expanded benefits, others say two-thirds of unemployed workers who are getting those benefits are taking home more than they would from their previous job.
The Benefits of More Benefits
On the other side of this debate, many argue that giving people more money right now a good thing— not just for everyday people who are hurting, but for the economy as whole.
“Unemployment benefits represent a critical component of the country’s recovery effort, as the weekly payments to out-of-work Americans function as a form of stimulus in their own right,” the Washington Post explained.
Normally, joblessness benefits are supposed to provide around 45% of a person’s wages, but in order to boost the economy, the extra $600 in the CARES Act is intended to be enough to give most people 100% of their lost wages.
“Unemployment insurance in a normal recession is a great stimulus because it has high bang for your buck. People spend it,” Chad Stone, the top economist for Center on Budget and Policy Priorities told the Post. “It’s very valuable to the people receiving it, and it’s beneficial to the economy.”
With rising concerns that more and more of the job losses caused by the pandemic will become permanent, that could be incredibly important for supporting the economy in the long term.
When it comes to unemployment, planning for the distance has proven to be essential in the past.
For example, during the 2008 financial crisis, Congress extended unemployment benefit eligibility up to 99 weeks.
While it was an expensive and controversial move, some experts said the payments were essential for people who were unemployed for way longer than their states would normally give them benefits, which currently is around 26 weeks in most parts of the country.
If more job losses are permanent, some argue extending these federal benefits could be absolutely necessary.
See what others are saying: (The Washington Post) (MSNBC) (ABC News)
US Records 4.8 million Job Gains in June, But Let’s Look at the Full Picture
- The jobs report for June showed that the U.S. gained 4.8 million jobs back last month and the unemployment rate fell to 11.1% from 13.3% in May.
- President Trump touted the report in a press conference, saying the U.S. is seeing record-breaking numbers and that economy was coming back strong.
- However, as many pointed out, unemployment is still the highest its been since World War II and over 1 million people are still filing for unemployment every week.
- Others also noted that the data from the report is from the week of June 12 and does not show the recent business closures made by governors in several states reimposing restrictions due to coronavirus spikes.
- Economists have warned that the renewed closures in some states and the fact that many other states have slowed their planned reopenings will result in more layoffs.
June Jobs Report
The U.S. economy gained 4.8 million jobs in June and the unemployment rate fell to 11.1% from 13.3% the month before, according to a monthly report released by the Bureau of Labor Statistics (BLS) Thursday.
Following the publication of the June report, President Donald Trump touted the new numbers during a press conference Thursday morning.
“Today’s announcement proves that our economy is roaring back,” he said. “It’s coming back extremely strong.”
“This is not just luck, what’s happening. This is a lot of talent,” he continued. “All of this incredible news is the result of historic actions my administration has taken working with our partners in Congress to rescue the U.S. economy.”
Trump also repeatedly claimed the job gains and employment numbers provided in the BLS report were record-breaking on multiple fronts.
However, many have noted that the only reason the U.S. is seeing record-breaking job gains is because it has experienced the record-breaking job losses.
That fact has even been echoed by members of Trump’s administration, including Treasury Secretary Steve Mnuchin, who acknowledged that unemployment is still extremely high by historical standards at the press conference Thursday.
Throughout the pandemic, American’s have seen unemployment rates similar to that of the Great Depression. Even now, unemployment is still the highest its been since World War II.
What the Data Shows
There are still over 17 million American’s unemployed, according to the BLS report. While it is true that we gained 4.8 million jobs back last month, more than 1 million people filed for unemployment every week in June including this past week, which saw 1.4 new claims.
There are also a number of other indicators in the BLS data that show that American’s are hurting.
For example, while the number of people temporarily laid off decreased by 4.8 million, the number of permanent job losses actually increase last month, rising by over half a million to 2.9 million total.
That suggests that many of the people going back to work are those who were furloughed during the shutdowns, meaning that the economy is simply getting back jobs it had temporarily lost, not adding or creating new jobs.
That fact was also noted by numerous Twitter users who sought to point out the holes in the president’s remarks.
“No, Trump did NOT create 4.8 million jobs in June – some people went back to their old jobs,” one user wrote.
Many other users also compared the unemployment rates of Black people and other people of color to that of white people, likely in response to Trump championing minority job growth while speaking at the press conference Thursday.
“African-American workers, really happily for me, made historic gains, with 400,000 jobs added last month alone and that’s a record,” he said. “Hispanic employment is up by 1.5 million jobs, a record by a lot.”
However, the BLS data minority unemployment has consistently remained higher than white unemployment— especially for Black people. In fact, according to a report from Reuters, the gap in U.S. Black and white unemployment rates is widest its been five years.
“Jobless rates for both groups fell in June, but the rate for whites came down at a much faster rate. The white unemployment rate fell 2.3 percentage points to 10.1% from 12.4%, while the rate for Blacks dropped 1.4 points to 15.4% from 16.8%,” the report said.
According to the BLS data, unemployment fell from last both groups in general, the unemployment rate among Black men over 20 actually rose from May to June, growing from 15.5% to 16.3%
While the discrepancy between Black and white unemployment was the most significant, white unemployment is still quite a bit lower than Hispanic unemployment which was 14.5% last month, and Asian unemployment, which was 13.8%.
Those numbers appear to support the claims of numerous experts who have said that people of color have been disproportionately hurt by the economic crisis.
“Disproportionately, the layoffs have been in lower wage occupations, in lower wage positions,” Gary Burtless, a labor economist at the Brookings Institution told the New York Times. “That has disproportionately affected African-Americans and Hispanics.”
While the BLS report does show the discrepancies between Trump’s rosy outlook and reality, it is only part of the picture.
There are several issues with the BLS data, and the agency has made readily apparent. It has repeatedly warned that the actual unemployment numbers are higher than what has been reported because of flaws in the data collection process. On Thursday, the BLS said that it believes the official unemployment rate for June is actually a whole percentage point higher.
But that is not the only problem. Arguably the biggest issue is that the data in this report was taken the week ending June 12, and since then, a number of states have shut down businesses again in response to the recent spikes in coronavirus cases.
Just in the last week, the governors of Florida and Texas have shut down bars and other commercial activities. California has stopped indoor restaurant dining and closed movie theaters in most major cities. Arizona has also shut down water parks, bars, and gyms.
Numerous other states have postponed their planned reopenings. As a result, some workers are now reportedly getting laid off for the second time.
Those closures and delays are expected to grow as cases continue to surge. On Thursday, the U.S. reported a new record of 50,000 coronavirus cases on a single day. New cases have risen a whopping 50% in the last month, according to the Washington Post
With those numbers rising and states with huge economies like Texas and California reimposing restrictions, many economists are worried that Americans will see more layoffs.
“The virus drives the economics,” Betsey Stevenson, a member of former President Barack Obama’s Council of Economic Advisers told the Times. “We’re not going to have people going back to work. In fact, we’re going to see more people staying home.”
See what others are saying: (NPR) (The New York Times) (The Washington Post)
Jeffrey Epstein Confidante Ghislaine Maxwell Arrested
- Ghislaine Maxwell, a British socialite and confidante of Jeffrey Epstein, was arrested by the FBI in New Hampshire Thursday morning.
- Maxwell has long been accused of helping Epstein in an alleged scheme to sex traffic underage girls.
- She is being charged with: enticement of a minor to travel to engage in illegal sex acts, transportation of a minor with intent to engage in criminal sexual activity, two related conspiracy charges, and two perjury charges.
- According to the indictment against her, Maxwell would befriend young women for Epstein, knowing he would later abuse them. She would also allegedly help create and normalize the environment in which they were abused, and in some cases was present for their abuse.
- She has repeatedly denied the allegations against her and is expected to appear in front of a federal court Thursday afternoon.
Maxwell Arrested in New Hampshire
Ghislaine Maxwell, Jeffrey Epstein’s long time associate who has been accused of helping him in his alleged sex trafficking schemes, was arrested on Thursday morning in New Hampshire.
Maxwell has been charged with six counts, enticement of a minor to travel to engage in illegal sex acts, transportation of a minor with intent to engage in criminal sexual activity, two related conspiracy charges, and two perjury charges. She has consistently denied allegations that she procured minors for Epstein.
Last year, Epstein was charged with sex trafficking and later died in his jail cell in August, with authorities ruling his death a suicide. Epstein, a wealthy financier who ran in powerful social circles, had long been accused of grooming underage girls for sex. In 2008, he was convicted of procuring a minor for prositution in Florida.
Maxwell is a British socialite known to be Epstein’s close friend, and at one point, girlfriend. After he was charged in 2019, she seemingly went off the grid. News tabloids speculated on her whereabouts for months, as she was connected to the high profile case and implicated by many of Epstein’s alleged victims.
“Maxwell assisted, facilitated, and contributed to Jeffrey Epstein’s abuse of minor girls by, among other things, helping Epstein to recruit, groom, and ultimately abuse victims known to Maxwell and Epstein to be under the age of 18,” an unsealed indictment claims. “The victims were as young as 14 years old when they were groomed and abused by Maxwell and Epstein, both of whom knew that certain victims were in fact under the age of 18.”
In addition to this, the indictment claims that Maxwell attempted to conceal her crimes and lied when she was questioned about her conduct, including one instance where she was under oath in 2016.
Details of Indictment
According to the indictment, Maxwell would attempt to befriend underage girls by asking them about their lives. She and Epstein would take them to the movies or on shopping trips. During these outings, the victims were either allegedly alone with Maxwell or Epstein, or with both of them at once.
“Having developed a rapport with a victim, Maxwell would try to normalize sexual abuse for a minor victim by, among other things, discussing sexual topics, undressing in front of the victim, being present when a minor victim was undressed, and/or being present for sex acts involving the minor victim and Epstein,” the indictment continues.
Apparently, having Maxwell in the room during these interactions “helped put the victims at ease because an adult woman was present.”
The indictment said Maxwell normalized abuse by massaging Epstein in front of victims, and then encouraging the victims to massage Epstein themselves. Many of those massages involved a minor being nude or partially nude, and then led to Epstein sexually abusing them.
According to the indictment, these crimes happened at Epstein’s residences in New York, Palm Beach, New Mexico and London. While many have accused Maxwell of partaking in this behavior for a long time, this indictment specifically refers to crimes alleged to have happened between 1994 and 1997.
Maxwell is expected to appear in front of a federal court Thursday afternoon.
See what others are saying: (NBC News) (The Guardian) (Bloomberg)
NYC Cuts $1 Billion From Police Budget as Protestors Occupy City Hall
Photo by Reed Dunlea for Rolling Stone
- New York’s City council announced that they were cutting $1 billion from the police budget—a demand made by protesters who have been occupying the area in front of City Hall for over a week.
- However, less than half of the proposed “cuts” actually cut money. Most of the funding being taken away from the police department is just being shifted to other departments.
- Even then, the largest cut is to overtime pay, and DeBlasio has openly said he’s not sure if the cuts can be made if the protests continue. The biggest funding shift is to place school safety officers under the purview of the Education Department—which already pays for the officers.
- Numerous activists and city councilmembers condemned the plan, saying it falls way short, including the Council Speaker, who helped draft the proposal, and who blamed Mayor Bill De Blasio for the lacking legislation.
New York City Council Announces Cuts
The New York City Council announced Tuesday that it was cutting $1 billion from the New York Police Department’s (NYPD) $6 billion operating budget, and moving some of those funds to education and social services.
The decision comes amid intensifying pressure for cities nationwide to reduce the amount of funding allocated to their police departments— which represents the single highest budget expenditure for most major cities.
While several cities have taken steps to scale back police funding at some level, many have been closely watching New York City, which is home to the largest and most expensive police force in the country.
With the city’s July 1 budget deadline looming, there has been increased pressure for officials to act. Over the last week, hundreds of protesters have been occupying the area outside of city hall— with many camping out overnight— to demand deeper cuts to the police budget.
The protest first started last Tuesday when about 100 people occupied City Hall Park, and since then, it has grown significantly. Some activists have reportedly said they will still stay after the budget deadline, but the general aim of the organizers who put together the demonstrations was to get the city council to cut the police budget by $1 billion.
NYPD Budget Cuts
While Tuesday’s announcement may sound like the city council gave the protesters exactly what they wanted, that is not the case for a number of reasons.
First of all, less than half the so-called “cuts” actually cut any funding. According to a press release from Mayor Bill De Blasio’s office, only $430 million will be actually cut from the department’s budget, while the $537 million will just be shifted to other departments.
Even then, some of the cuts are still up in the air. For example, the biggest single cut is more than $350 in overtime pay, but De Blasio has said that might not be possible if protests or other things that require a lot of police happen.
Just since George Floyd’s death on May 25, NYPD paid out $115 million in overtime.
There are also some major holes in the funding that’s being shifted to other departments. For example, over $400 million of funds they say they are shifting will be moved to school safety officers to be under the purview of the Department of Education.
However, according to the city’s Independent Budget Office, the Education Department already funds that program and gives the Police Department $300 million a year to operate it. In other words, one of the biggest funding “shifts” is not a shift at all— it just means that the Education Department will now operate a program it was already funding.
Numerous people have responded to the announcement with anger, arguing that the move is simply smoke and mirrors and that the city is just shifting the money around without making any substantive cuts to the police budget.
“Defunding police means defunding police,” Rep. Alexandria Ocasio-Cortez (D-NY) said in a statement. “It does not mean budget tricks or funny math.”
“It does not mean moving school police officers from the NYPD budget to the Department of Education’s budget so the exact same police remain in schools. It does not mean counting overtime cuts as cuts, even as NYPD ignores every attempt by City Council to curb overtime spending and overspends on overtime anyways,” she continued.
“These proposed ‘cuts’ to the NYPD budget are a disingenuous illusion. This is not a victory. The fight to defund policing continues.”
A number of protest leaders and organizers echoed that sentiment, saying the proposal was not what they asked for.
“We are being gaslit,” said activist Jawanza James Williams. “This movement is about so much more than the $1 billion, and this means they don’t understand what we’re saying.”
Numerous city council members also voiced their dislike of the plan, including Council Speaker Corey Johnson, who helped lead the process in drafting the proposal.
“To everyone who is disappointed — and I know that there are many, many people who are disappointed that we could not go further, I am disappointed as well,” he said. “I wanted us to go deeper.”
“This is a budget process that involves the mayor who would not budge on these items,” Johnson added, placing the blame squarely on De Blasio.
Other council members also said the cuts did not go far enough, like Councilman Brad Lander, who voted no on the proposal and called it “more budget-dancing than meaningful reductions.”
However, at the same time, there were plenty of council members that opposed the cuts because they did not want the police budget to be reduced at all.
“We know what we’re doing and we know that what we’re doing will create a more violent city, and yet we’re doing it anyway,” said Councilman Joseph Borelli.
“Black folks want to be safe like everyone else, we just want to be respected,” Councilman I. Daneek Miller, co-chairman of the Council’s Black, Latino and Asian Caucus, said. “We can’t allow folks from outside our community to lecture us about Black lives and what we need in our communities.”