The Democrats’ HEROES Act Could Extend Our Economic Distress

Thanks to the economic relief packages that have already been implemented, the U.S. is set to run a $3.8 trillion deficit this year. But Speaker of the House Nancy Pelosi and her fellow House Democrats have proposed yet another round of spending—the $3 trillion “HEROES Act.”

The bill includes a federal bailout for financially struggling states and localities and additional broad-based $1,200 relief checks for individuals. But the most significant provision could be its extension of enhanced unemployment benefits through January 2021. Critics warn this could undermine states’ efforts to reopen and put a drag on our economic recovery through 2021. 

Here’s why.

The original $2 trillion CARES Act, passed in March, expanded eligibility for state-level unemployment benefits, and it gave workers an additional $600 weekly in federally funded benefits. This made it more profitable for some workers to stay home than return to work. 

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