Senate Democrats strike deal to extend US unemployment benefits

Senate Democrats have struck a deal to extend emergency unemployment benefits until October in Joe Biden’s $1.9tn stimulus bill, providing relief for the jobless for an extra five weeks in one of their final changes to the plan.

The compromise between centrist and liberal members of Biden’s party will see the pandemic top-up to unemployment benefits cut to $300 a week from $400 as part of the deal to pay it out for longer, according to a Democratic aide.

It came as the upper chamber began a marathon session to consider a series of amendments to the stimulus bill before it moves to a final vote in the coming days.

The need to maintain emergency unemployment benefits after they expire on March 14 has been one of the primary catalysts of the push for extra stimulus from Biden, who wants to offer protection to millions of Americans who remain out of work because of the pandemic.

But until Friday it had been the focus of intense haggling among Democratic lawmakers who were unhappy with the House version of the bill, which extended the benefits at $400 a week until the end of August.

The deal includes a new provision for a tax exemption on the first $10,200 in jobless benefits. Jen Psaki, the White House press secretary, said the combined changes would provide more help to the unemployed than the previous version.

The agreement marks the second significant change to the stimulus bill this week, after Democratic senators agreed to narrow eligibility for the $1,400 direct payments in the plan.

The changes to the stimulus bill are designed to maintain Democratic unity around the legislation and ensure that there are no hiccups as it moves to a final vote. The upper chamber is evenly divided between 50 Democrats and 50 Republicans, and Kamala Harris, the vice-president, casts any tiebreaking votes, giving Biden’s party a narrow edge but no room for defections.

The agreement on unemployment benefits was reached as data from the US labour department showed jobs growth rebounding from its winter slump but still far short of pre-pandemic levels, prompting Democrats to stress the need for more stimulus as Republicans said the economy would recover without it.

“The February jobs report shows some progress, but much more is needed to address the daily reality of joblessness and financial insecurity facing millions of Americans,” said Nancy Pelosi, the Democratic House speaker, on Friday.

Even though opinion polls show a large majority of Americans support the stimulus, Republican lawmakers have mounted united opposition to the legislation, saying the aid is not sufficiently targeted at those who need it most and that the overall price tag is excessive.

“[Democrats] are dead-set on ramming through an ideological spending spree packed with non-Covid-related policies,” said Mitch McConnell, the Republican leader in the Senate, on Friday morning.

Ron Klain, the White House chief of staff, responded to the Republican criticism on Twitter: “If you think today’s jobs report is ‘good enough,’ then know that at this pace . . . it would take until April 2023 to get back to where we were in February 2020”.

On Friday afternoon, Biden was expected to meet his top economic officials, including Cecilia Rouse and Brian Deese, to discuss the administration’s economic response to the pandemic.

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