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- White House press secretary Jen Psaki said GOP states "have every right" to cut federal unemployment aid.
- The moves in red states imperil jobless aid for 4 million workers in the coming weeks.
- Biden also signaled he supported allowing the jobless aid to expire in September as scheduled.
White House press secretary Jen Psaki said on Friday that Republican states have the right to cut federal unemployment benefits set to expire in three months.
"Those governors who have made the decision, as they have every right to do, to pull back on unemployment benefits or not accept them, I should say accurately – that hasn't even taken effect in any state across the country," she said at her daily press conference.
She went on: "It is important for people to understand, factually, that the president – no one from the administration – has ever proposed making these permanent or doing it over the long term."
Psaki underscored that states could choose whether they wanted to opt out of the program, saying "every governor is going to make their own decision."
The comments mark a striking change of tone for the White House on federal unemployment benefits as the economy picks up more jobs and Republicans step up their political attacks on the stimulus aid. Currently, a weekly federal $300 supplement to state unemployment insurance is scheduled to expire in September, which President Joe Biden said "makes sense" on Friday.
Just over a month ago, Biden called for long-term jobless aid reforms to form part of his infrastructure plans, though he did not attach funding or specifics to it. Psaki's comments on Friday could signal a shift in the administration's position on that provision.
Asked last month whether the jobless aid was impeding people from returning to work, Biden responded there was "nothing measurable."
Currently, half of states have opted to slash their federal unemployment benefits early. All of them are led by GOP governors. Many of those governors cited the increased benefits as a disincentive for workers to return.
But, as Insider's Ayelet Sheffey reported, none of those cuts have been enacted yet - but the labor market's recovery still accelerated in May. That shows that, even while the increased benefits were still in place, people returned to the workforce.
That tracks with a working paper from the Federal Reserve Bank of San Francisco, which found that just about one in 28 unemployed workers would opt to remain on benefits rather than return to the workforce.
Workers that Insider spoke to said they were still seeking out new positions, but that governors preemptively cutting benefits have left them scrambling. For some, the issue is a mismatch between their skills and experiences and open positions; that widespread situation may well be one of the primary drivers of the current labor crunch.
"I just wish the Biden administration could just jump in and just stop what the governors are doing, or make sure that we still have something coming in to live with," Cindy Walker, 57, told Insider in May. Walker is currently unemployed in Missouri, where federal unemployment benefits are set to end on June 12. She's one of those workers still seeking a new position.
Some advocates and politicians have called on the Biden administration to step in and pay out some unemployment benefits. Specifically, they argued that the government was mandated to distribute Pandemic Unemployment Assistance (PUA), which expanded eligibility for benefits to gig workers, among others. Sen. Bernie Sanders even wrote a letter to Labor Secretary Marty Walsh calling on him to continue providing PUA.
"Workers who lack access to childcare, have lost employer-sponsored health insurance, and fear for their health and safety as we work to get every American vaccinated are entitled to these benefits," Sanders wrote. "They will be forced into poverty - either with poor jobs with unfair wages or no income at all - if you fail to provide these benefits."
However, the Labor Department ultimately concluded it likely won't be able to pay out PUA. Now, with the latest from the White House, it seems as though the Biden administration won't be stepping in.
This story is developing.
