Coronavirus stimulus: Mitt Romney and other GOP senators propose 11th hour extension of extra unemployment benefits

The extra $600 in weekly unemployment benefits provided the federal government to Americans amid the coronavirus pandemic is expected to expire after Friday as Congress struggles to agree upon the next stimulus package.

A few Republican senators are pitching a last-minute proposal.

U.S. Senators Mitt Romney (R-UT), Susan Collins (R-ME), and Martha McSally (R-AZ) introduced an alternative unemployment benefits (UI) legislation on Thursday aiming to prevent a gap in the distribution of the benefits.

“Unemployed workers should not be left in limbo while Congress continues to negotiate the next relief package,” Romney said in a statement. “Our solution extends the supplemental benefits for three months and incentivizes states to update their UI processing systems. We should act with urgency to help the millions of Americans who are on the verge of losing these additional benefits.”

The proposal suggests allowing states to choose between reducing the unemployment benefits to an 80% wage replacement rate or gradually reducing the extra benefits to — $500 per week in August, $400 per week in September, or $300 per week in October.

Until a deal is reached between both parties, jobless Americans will not receive any unemployment benefits beyond what their states allow. Most states pay those benefits on weeks ending on Saturday or Sunday. That means July 25 or July 26 was the last time those workers got the extra $600.

“We're already at the point where people will likely see delays in distribution of benefits,” Martha Gimbel, manager of economic research at Schmidt Futures told Yahoo Money earlier in the week. “That deadline was this past weekend and we blew past it.”

In May, the Democrat-led House passed the HEROES Act, which would have extended extra UI benefits among other stimulus measures, but the legislation was never considered by the Senate. Senate Majority Leader Mitch McConnell (R-KY) called the $3 trillion HEROES Act a “socialist manifesto” but did not present a GOP counterproposal until this week.

‘We’re nowhere close to a deal’

Also on Thursday, the GOP-led Senate passed a “shell” bill — legislation with no substantive provisions which is amended later to include the actual proposals — in an apparent attempt to make progress on unemployment benefits.

"It makes it the pending business for next week," McConnell told reporters on Thursday. “And we can keep talking and hopefully making progress because no progress is being made anywhere else.”

However, as the negotiations between Democrats and Republicans continue, a deal is unlikely to be reached by the end of the month when the unemployment benefits expire.

“We’re nowhere close to a deal,” White House Chief of Staff Mark Meadows told reporters on Wednesday afternoon. “It means enhanced unemployment insurance provisions will expire.”

While the additional benefits from the CARES Act expire on July 31, the last payment with the extra $600 went out this past weekend. That means unemployed Americans will receive vastly smaller benefits in their next checks this weekend.

On Monday, the GOP released its proposal that calls for cutting the extra unemployment benefits to $200 a week through September and then ultimately transitioning to unemployment benefits that replace only 70% of wages. But Democrats, who have proposed a full extension of the $600 in the HEROES Act, aren’t on the same page.

Read more: Do you have to pay taxes on unemployment benefits?

“We don’t know why the Republicans come around here with a skinny bill that does nothing to address, really, what’s happening with the virus and has a little of this and a little of that,” Speaker Nancy Pelosi (D-CA) said on Wednesday. “We’re not accepting that.”

‘We’re going to take care of the people’

Until a bill is passed, some Republican senators and President Donald Trump have been hinting at a short-term extension.

When asked about the temporary extension by reporters at a press briefing on Tuesday, Trump said: “We’ll do something. We’re going to take care of the people.”

Sen. Rob Portman (R-OH) also supports a temporary extension if a deal can’t be reached this week.

“We cannot allow there to be a cliff in unemployment insurance given we're still about 11% unemployment, about 17 million Americans out of work, some through no fault of their own," Portman told reporters last week. “So I think we should do something.”

However, Meadows previously said the Trump administration doesn’t favor the extension and that they’re looking to address unemployment “in a longer term manner.”

Read more: What to do before you lose your job

“Having some short term extension of UI, or unemployment insurance benefits, just to allow for a longer negotiation is certainly not worthy of consideration,” Meadows told Politico’s Jake Sherman last week.

Democrats, including Pelosi and Senate Minority Leader Charles Schumer (D-NY), also don’t support the short-term extension. Pelosi said Congress “cannot piecemeal” a deal on stimulus, while Schumer said you can’t “take care of one portion of suffering people and leave everyone else hanging.”

Denitsa is a writer for Yahoo Finance and Cashay, a new personal finance website. Follow her on Twitter @denitsa_tsekova.

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