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November 28, 2020
Health News

Listen: The Virus Is Peaking, but Help Is Going Away

Many provisions of the CARES Act ran out in July. Soon, state unemployment insurance will start to run out for people who lost work at the beginning of the pandemic. Congress and the White House have failed to pass new support, and even if an agreement is reached, Senate Republicans have signaled that they’ll prioritize confirming Amy Coney Barrett to the Supreme Court before the election.

On this episode of the podcast Social Distance, the executive producer Katherine Wells and the staff writer James Hamblin talk with Diane Whitmore Schanzenbach, an economist at Northwestern University who studies the social safety net. She describes a dire situation for poor Americans and a tremendous need for new relief funding.

Listen here:

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What follows is a selection of the conversation, edited and condensed for clarity:

Katherine Wells: One thing I’ve had a hard time grasping is the scale of the problem we’re facing right now. How do you describe it in a way that people can understand how big it is?

Diane Whitmore Schanzenbach: A way to think about it is through the access to food that families have. And we’ve got two broad measures of that. One is food insecurity. That’s the idea that families don’t have enough money to buy the foods that they want to eat. Sometimes it means hunger, and sometimes it means shifting to cheaper foods. And the rate of food insecurity—especially among families with kids—has skyrocketed during COVID-19. The best estimates are that the numbers have tripled. It used to be around 10 percent. Now it’s around 30 percent. Three out of 10 people with kids are food insecure right now.

And that’s a broad measure. We can think about people reporting they don’t have enough to eat. And similarly, we’ve seen levels of people in the United States not having enough to eat that are unconscionable. They’re higher than anything we’ve seen on record. I just pulled the most recent numbers, and 14 percent of people report to the Census Bureau that, over the first half of October, they sometimes or often don’t have enough to eat in their house. That’s a lot of kids.

Wells: As I’m listening to you, rage is welling up inside of me. Why is this happening?

Schanzenbach: When it comes to kids, two big things have shifted. One is schools, and the other is family money that allows them to buy food. The question of schools is hard, right? We need to get the virus under control, and there’s all sorts of moving parts. That’s a hard problem to solve. What is not a hard problem to solve is feeding people. We can give them money. We can give them food stamps, what is now called the SNAP program. There’s a lot of very straightforward policy solutions that could be implemented.

And I should be quick to say that we’ve done some of those. [The CARES Act created] the Pandemic EBT program, which provides families money for school meals that they missed. We’ve been able to study it and we can show that it reduces food hardship as experienced by kids. That’s a really good program. We were worried that Congress wasn’t going to reauthorize it, but in the nick of time, they decided that they would reauthorize it through this year.

What’s staggering is these numbers would be even worse if it weren’t for what we’re already doing. Just fundamentally, this is not hard to solve. It just takes money.

Wells: How much did the CARES Act help?

Schanzenbach: That’s a hard question to answer because so much other stuff was going on with the economy. It’s hard to know how much worse things would be if it weren’t for the CARES Act, but we can say they made some really smart policy decisions. That initial boost to unemployment insurance, that extra $600 a week, really made a big difference. Another policy change that they made was they increased SNAP benefits to people who weren’t already getting the maximum benefit. And it also gave states—this is not very exciting, but, boy, it makes a difference on the ground—they gave states flexibility to concentrate only on enrolling new families who were newly eligible for SNAP and not processing renewals and things like that.

I wrote a paper for the Brookings Institution that tried to understand, given how much we’ve spent, why is there still so much suffering? We came up with three reasons. The first is that aside from that unemployment-insurance bump, the rest of the benefits just weren’t all that generous. The second was, many of the benefits came with delays. At the beginning, people had to really wait to get their unemployment insurance. And the third is that there are a lot of holes in our safety net. A lot of families suffering food insecurity and hunger didn’t lose their jobs, but they lost income anyway. They lost shifts or they lost gigs. But because they didn’t lose their job, in most places, they’re not getting unemployment insurance. They’re just having to weather the shock without any additional public benefits.

Wells: What’s the situation we’re in right now, given that many of the provisions of the CARES Act have expired, and the federal unemployment is out? What do we need now and what’s happening?

Schanzenbach: We need something from Congress. And, of course, it’s been very frustrating as someone who studies the amount of hardship that the poor face, to see so much inaction. But I think we need a couple of things. We need more unemployment insurance. I’m not sure it needs to still be at $600, but it has to be something. A lot of people think $400 is maybe the right amount. I think it’s a no-brainer that we should be increasing SNAP benefits. During the Great Recession, we increased them by 15 percent. That was a very effective policy, both in terms of stimulating the economy and in terms of reducing hardship.

We’re seeing so much hardship and we’re spending precious little relief aimed at the poor, which doesn’t make a lot of sense. And, of course, as someone who studies kids, I would argue that states really do need additional resources so they don’t have to cut school spending. As you may know, many states are under balanced-budget requirements. So when you get hit with an economic shock like this, the budget gets balanced on the backs of kids and other vulnerable populations.

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