There likely won’t be any new legislation aimed at softening the economic blow caused by the COVID-19 pandemic for several weeks, but Ohio’s senators already know what they’d like in it.
“The next COVID legislation that is coming up probably won’t be enacted into law without hearing until after the July 4 recess, in other words, sometime in late July,” said U.S. Sen. Rob Portman (R-Ohio).
“I am already engaged in that process in a number of ways, one of which is to be sure that in regard to people who are on unemployment insurance that there is not a disincentive for people to return to work,” Portman said.
He has said in the past that as the economy is opened back up, some business owners have said they are having problems getting employees back to work in light of the $600 in additional unemployment insurance payments approved as part of the Coronavirus Aid, Relief and Economic Security Act.
“We had new retail numbers come out (recently) that were quite positive, the market is reacting positively and we had the better jobs numbers from May,” Portman said.
“It looks like the economy is starting to pick up in ways people had not projected, and most economists are surprised, and this means there is a need for more workers,” the senator added.
He said a recent study by the University of Chicago shows 60%-70% of those currently on unemployment and receiving the extra payment can make more by staying on unemployment than by returning to work.
“This is an issue,” Portman said.
He has proposed a “return to work bonus” which would allow people to continue to get at least a portion of that money even when they return to work.
“That would take away this disincentive, in my view,” Portman said. “You want people to get back to work. That’s where their health care is, that’s where most people get their retirement plan, their 401(k), and it’s certainly where people get the dignity and self respect that comes from work.”
He said he believes people want to go back to work, but admits the decision can be hard when making more money to not work.
“I hope we’ll be able to do this in a bipartisan way. We have been talking to Democrat offices over the last month on this and there’s a lot of interest,” Portman said.
He added the official stance currently from the U.S. House Democratic leadership is to keep the unemployment payment going until sometime next year. He said he feels that would be a mistake.
U.S. Sen. Sherrod Brown (D-Ohio) seems to agree more with that plan, as well as helping states, such as Ohio, that have had to borrow money to keep their own unemployment insurance programs running to meet the high demand.
“Washington should ease that burden, but also should extend the unemployment benefits,” Brown said. “I’m concerned about Ohio businesses always, but I’m especially concerned about Ohio workers.”
He added he expects hundreds of thousands of workers to still be unemployed through August, when the current CARES unemployment bonus is set to expire.
“We would be both hardhearted and stupid as a congress if we didn’t extend benefits beyond July 31,” Brown said.
He also said there could be a large increase in the number of evictions over the next several months.
Portman also said there should be some relief for retirement plans hurt during the pandemic. Portman said he would try to use that as an opportunity to expand private investment as part of retirement packages.
“Let’s be honest, people’s 401(k)s got killed during the downturn in the market, but more importantly, people are taking money out just to survive,” Portman said.
He added part of the CARES Act was to allow people to draw on those funds without the usual penalties that are involved.
“Even so, it’s tough to save right now, and a lot of people aren’t at work, so they’re not getting the payroll deduction,” Portman said. “I think it’s important to re-energize that.”
He added retirement savings were already low, particularly with Baby Boomers. He would like the penalty removed for those who are over 70 but still working. They are forced to take a minimum out each month whether they need it or not and pay tax on it.