Evictions, loss of unemployment aid threaten millions while COVID-19 resurges

Coronavirus news image header
Photo credit
CentersforDiseaseControl Senate UnemploymentInsurance Coronavirus Covid-19 BidenAdministration EvictionMoratorium AmericanRescuePlan

The next wave of COVID-19 is hitting in every state, but not surging everywhere thanks to effective vaccines. However—and this is a big caveat—a good part of the the country is being swamped by the virus at the same time that some of the safety nets created by Congress are expiring or states are refusing to continue them, including some of the states in the middle of this new surge.

The federal moratorium on evictions enacted by the Centers for Disease Control and Prevention (CDC) expires at the end of this month, and the possibility of the administration extending it was complicated Friday when a federal appeals court ruled that the CDC exceeded its authority in extending the eviction freeze this year. It’s not clear where this leaves the expiring moratorium.

The government could appeal to the Supreme Court, but last month when the Supreme Court voted 5-4 to reject an attempt by a landlord group to lift the ban, one member of that majority—Brett Kavanaugh—indicated that any further extensions of the moratorium would require action from Congress, which only has one week to do so if it’s going to happen. But economists and housing activists are lobbying for the administration to act.

About 6 million renters face eviction at the end of the month. One analyst, Paul Williams, a fellow at the Jain Family Institute, estimates that about 80% of those households are in counties with rapid delta variant COVID-19 surges.

The Center on Budget and Policy Priorities has been tracking economic insecurity during the pandemic, and finds that about 11.4 million renters are behind on rent. The administration has extended the moratorium on mortgage foreclosures.

At the same time, unemployment has stagnated while a couple dozen states have either cut off or will cut off boosted unemployment insurance (UI) before the Sept. 6 expiration of the program. In the 12 states that cut federal UI in the first half of June, unemployment has not decreased as lawmakers insisted it would. “Certainly there was no immediate boost to employment during the 2-3 weeks following the expiration of the pandemic UI benefits,” Arindrajit Dube, an economics professor at University of Massachusetts Amherst, has found.

Dube found that “even as there was a clear reduction in the number of people who were receiving unemployment benefits—and a clear increase in the number of people who said that they were having difficulty paying their bills—that didn’t seem to translate, at least in the short run, into an uptick in overall employment rates.” That means that cutting off unemployment was not the magic wand to make the economy come roaring back, as Republicans promised. It just means more people are facing economic insecurity. This is dangerous for the nation’s economic recovery, particularly when coupled with a new surge in the pandemic.

While it might be tempting to think that these vaccine refusers in the states that are experiencing the sharp increases in infections deserve what they’re getting, remember that a big chunk of the unvaccinated are not refusers, but are people of color in communities that have longstanding barriers to accessing health care and also face complications in the logistics of getting the vaccine. Some can’t afford to take time off work to get the vaccine, nor do they have the option of taking a sick day if they have side effects from it. Regardless of who is getting sick and why, the reality is it’s bad for the entire nation.

And it’s a particularly bad time for Congress to agree to the bipartisan infrastructure group’s idea to take “unused” COVID-19 relief funding away to use on infrastructure in lieu of raising taxes on rich people for the funding. According to people familiar with the negotiations, the group of bipartisan senators is “targeting unspent COVID-19 relief aid to health care providers and extending multiyear, modest reductions in a wide array of federal benefit programs.” That’s a bad plan right now.