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Axios' Felix Salmon (left) and Rep. Pramila Jayapal. Photo: Axios

The Paycheck Recovery Act could serve as an "automatic stabilizer" in future unemployment crises like the coronavirus pandemic by offering direct grants to affected businesses, the bill's sponsor, Rep. Pramila Jayapal (D-Wash.), said Wednesday at an Axios virtual event.

The big picture: Under Jayapal's proposal, which has bipartisan support and is under consideration in the House Financial Services Committee, the federal government would subsidize the benefits and salaries of qualified workers if unemployment hits 7% or higher. The intent is to limit the number of people filing jobless claims.

  • Overwhelmed unemployment systems are backlogged, causing delays in some benefits.
  • The proposal would be permanent and would not require congressional approval for each round of grant distributions.

What they're saying: "When you overload an already diminished system of unemployment, you essentially limit a whole bunch of people from getting any kind of support."

  • "So if you do the Paycheck Recovery Act, and you expand unemployment, and you provide additional relief... that would have been the kind of comprehensive package where perhaps we could have kept unemployment numbers lower...."

Watch the event, "Reimagining capitalism in America."

Go deeper

Updated Dec 27, 2020 - Politics & Policy

"Too many people are relying on this": Lawmakers urge Trump to sign COVID relief bill

Photo: Saul Loeb/AFP via Getty Images

Several lawmakers on Sunday railed against President Trump and demanded he sign the $900 billion coronavirus relief bill and $1.4 trillion government funding measure passed by Congress last week.

Why it matters: Unemployment benefits for millions of Americans lapsed overnight, and the federal government may be forced to shut down this week if Trump does not sign the measure.

Trump signs COVID relief bill, averting government shutdown

Photo: Doug Mills/Getty Images

President Trump signed a bill to extend unemployment benefits and avert a government shutdown, the White House said in an emailed statement Sunday evening.

Details: While Trump signed the current bill providing $600 checks for most Americans hours before a midnight government shutdown deadline, he is continuing his push to bring that amount to $2,000, as Axios reported earlier.

Updated 2 hours ago - World

U.S. and U.K. blame Iran for drone strike on oil tanker

Britain's Foreign Secretary Dominic Raab. Photo: Sameer Al-DOUMY / AFP

Secretary of State Antony Blinken and British Foreign Secretary Dominic Raab said on Sunday that the United States and United Kingdom, respectively, now believe Iran was likely responsible for last week's drone strike on an oil tanker in the Arabian sea.

Why it matters: The United States and Britain now join Israel in accusing Tehran of being behind the July 29 attack off the coast of Oman. Iran has denied involvement.