According to a new report, the US government is in for a welfare trap. Due to the ongoing Covid-19 pandemic, the government announced federal unemployment benefits for eligible citizens, which has become a long-term threat to the government in the coming fiscal year.
The government expanded eligibility for unemployment benefits under emergency response legislation. The unemployment benefits extend for only a year, but they can be extended further for 53 weeks with additional bonuses under the new legislation. The amount of welfare received by the individuals can be broken down as $3,700 a month, or $44,000 a year with up to $300 with additional weekly bonuses. With an extension of welfare added to the benefits, the people are paid to stay at home.
The term is about to end by September. The congressional Democrats are pushing the federal government to extend the benefits to additional weeks because the already designated are not enough according to them, hence the addition of bonuses. Though it paints a clear picture that the people are becoming more dependent upon the government as they are being provided with benefits while at home and do not have any motivation to look for a job. Once the term for benefits ends, they can look for a job if they want to keep availing the benefits. Still, the democrats are pushing to exempt that by continually stating the pandemic as a barrier to economic opportunities. Maybe it’s the democrats’ other strategy of bribing their way to gain people’s support.
Incentivizing unemployment can prove to be a political threat and long-term liability if not controlled timely. With the threat of another lockdown due to the Delta Variant, the tax-paying citizens are reducing. On top of that, the benefits introduced as the disaster response mechanism to Covid-19 can lead to a financial burden on the state. Biden better come up with a solution to pay off the debts of the previous fiscal year before the pandemic strikes with another socio-economic crisis.