The Cares Act: A Look At The Realities of Reform

August 18, 2020 by Aburiyeba Amaso

by Victoria King

The first coronavirus (COVID-19) case was identified in the United States on January 20, 2020.[1] Months later, COVID-19 cases continue to rise[2] and lay bare persistent economic disparities that necessitate long-term solutions.[3] To date, the combined efforts of global leaders, institutions, and businesses tasked with managing the public health crisis along with differing federal, state, and local government responses have not stymied the spread of disease in the United States. Instead, these disconcerted relief efforts have deepened the racial and economic inequalities that persisted in America before the pandemic.[4] These deeply rooted inequities push community members, organizers, and activists to persistently challenge the government to provide better access to healthcare, more robust social services, and a livable wage for all workers. The disproportionate impact of COVID-19 highlights[5] why these areas of concern desperately require not only national attention, but also robust national policies that can outlast times of crisis. This post discusses how COVID-19 and the subsequent passage of the Coronavirus Aid, Relief, and Economic Security (CARES Act) may broaden our collective understanding of the need for expanded social services and greater workers’ rights post-COVID-19.

Congress passed the CARES Act on March 27, 2020[6] which included strikingly broad protections for low-income workers and small businesses.[7]  For example, the Act extended financial bailouts to households “in the form of stimulus checks sent directly to most Americans [and] expanded unemployment benefits, paid sick leave, [and] temporary student debt relief.”[8] Such progressive measures would have represented a victory for labor and civil rights advocates had Congress passed them under more ordinary circumstances. For example, labor and civil rights advocates have been consistently campaigning to secure more robust workplace protections for gig economy workers. These workers are currently classified as independent contractors and, outside the CARES Act, receive very little workplace protections.[9] Congress’s decision to qualify gig economy workers, who are not traditionally eligible for state unemployment benefits,[10] as eligible beneficiaries of the CARES Act, demonstrates which potential measures may be taken to protect all workers. The passage of the CARES Act demonstrates that Congress is capable of enacting progressive policies that respond to the systemic issues of workplace discrimination and economic inequality. Some may wonder if, after passing the CARES Act, Congress may finally be willing to modernize employment and labor protections,[11] consider amending existing legislation, like the Fair Labor Standards Act (FLSA), and provide greater workplace protections through more long-term solutions.[12]

Although COVID-19 is not the first time that advocates have pushed for broader policies to support the most vulnerable workers, the CARES Act should still be considered a step in the right direction. New studies report that the CARES Act may be successful in assuaging poverty – at least in the short-term.[13] However, concerns remain about the law’s failure to address the long-term financial instability and concerns of low-income, households of color, whose financial hardships are exacerbated by the ongoing nature of the pandemic.[14] Although there is bipartisan support for a second-round of stimulus checks, the timeline for when these stimulus checks will be issued is largely dependent on the Republican controlled Senate.[15] As lawmakers debate these details, respected economists are encouraging Congress to also consider recurring stimulus checks[16] with an understanding that these payments help keep low-income families “afloat and drive economic activity.”[17] But the sad reality is that these stimulus checks are a short-term fix rather than a solution that reduces and eliminates poverty.

Ongoing debates in Congress about a second federal relief package shows that lawmakers are keenly aware of the extent of their power to provide direct relief and fund much broader social services to address longstanding economic issues. Unsurprisingly, progressive leaders have already begun to urge Congress to pass additional legislation that “puts workers, Black and brown communities, and the most vulnerable families ahead of Wall Street and massive corporations.”[18] In a recent COVID-19 press release, these leaders discussed four key principles to: (1) “build economic resilience for the long term”; (2) “reinforce essential responders, including workers, small businesses, and state and local governments”; (3) “repair the economy by helping people”; and (4) “prevent further accumulation of corporate power.”[19] This push for long-term federal interventions demonstrates how advocates are using Congress’s pandemic response to make a case to lawmakers urging them to pass legislation that eradicates the root causes of poverty. Ultimately, the CARES Act serves as a baseline that advocates can point to as they continue the fight for more holistic policy solutions.

In 1967, Martin Luther King, Jr. wrote: “Laws are passed in a crisis mood…but no substantial fervor survives the formal signing of legislation. The recording of the law in itself is treated as the reality of the reform.” While in crisis mode, Congress passed several anti-poverty measures in the CARES Act. Advocates should not allow Congress’s efforts to address economic inequalities to subside and Congress should resist the temptation to treat the bill’s passage as the culmination of economic reform. Instead, during these unprecedented times, advocates may leverage the CARES Act and find greater success in forcing Congress to develop federal legislative solutions that respond to the disproportionate economic harms even beyond the ongoing crisis. It is my hope that the fervor with which Congress responds to the realities compounded by COVID-19 represents a much larger shift in their response to our more permanent crises – related to economic inequality, healthcare, and the like – that will survive the eventual passing of the pandemic.

 

 

 

[1] Jennifer Harcourt, et al., Severe Acute Respiratory Syndrome Coronavirus 2 From Patent With Coronavirus Disease, 26 emerging infectious diseases 6, 1266 (2020).  https://wwwnc.cdc.gov/eid/article/26/6/20-0516_article

[2] Matt Berger, States Are Learning What Happens to COVID-19 Cases If You Reopen Too Early, Healthline (June 30, 2020), https://www.healthline.com/health-news/covid19-cases-rising-states-reopened.

[3] Liz Theoharis, Inequality and Poverty Were Destroying America Well Before Covid-19, The Nation (Apr. 22, 2020), https://www.thenation.com/article/society/inequality-and-poverty-were-destroying-america-well-before-covid-19/.

[4] See e.g., id.

[5] U.S.: Address Impact of Covid-19 on Poor, Human Rights Watch (Mar. 29, 2020, 5:48 PM), https://www.hrw.org/news/2020/03/19/us-address-impact-covid-19-poor

[6] The CARES Act Works for All Americans, U.S. Dep’t. of Treasury, https://home.treasury.gov/policy-issues/cares (last visited Aug. 3, 2020).

[7] Emily Cochrane et. al., Here’s What’s in Congress’s Coronavirus Bill, N.Y. Times (Mar. 14, 2020), https://www.nytimes.com/2020/03/14/us/politics/congress-coronavirus-bill.html.

[8] Kelly Anne Smith, Your Guide To The Federal Stimulus Package, Forbes (Mar. 27, 2020, 5:11 PM), https://www.forbes.com/sites/advisor/2020/03/27/your-guide-to-the-federal-stimulus-package/#4a17a8ca2711.

[9] Rebecca Smith, Independent Contractors and Covid-19: Working Without Protections, Nat’l Employment L. Project (Mar. 24, 2020), https://www.nelp.org/publication/independent-contractors-covid-19-working-without-protections/.

[10] Nicole Clark, INSIGHT: Gig Workers Can Qualify for CARES ACT Unemployment Aid, Bloomberg L. (May 6, 2020), https://news.bloomberglaw.com/daily-labor-report/insight-gig-workers-can-qualify-for-cares-act-unemployment-aid.

[11] Orly Lobel, The Debate Over How to Classify Gig Workers Is Missing the Bigger Picture, Harv. Bus. Rev. (July 24, 2019), https://hbr.org/2019/07/the-debate-over-how-to-classify-gig-workers-is-missing-the-bigger-picture.

[12] Patricia Barnes, Proposed Law Would Protect Independent Contractors From Employment Discrimination and Wage Theft, Forbes (Nov. 13, 2019, 4:14 PM) https://www.forbes.com/sites/patriciagbarnes/2019/11/13/proposed-federal-law-would-extend-protection-from-discrimination-to-independent-contractors/#420038bb44a5.

[13]  Study Calls for Ensuring Access to CARES Act Benefits for Poor, Philanthropy News Digest (June 24, 2020), http://philanthropynewsdigest.org/news/study-calls-for-ensuring-access-to-cares-act-benefits-for-poor.

[14].

Zachary Parolin et. Al., The CARES Act & Poverty in the COVID-19 Crisis: Promises and Pitfalls of the Recovery, 4 Poverty & Soc. Pol. Brief June 21, 2020, at 9, https://static1.squarespace.com/static/5743308460b5e922a25a6dc7/t/5eefa3463153d0544b7f08b4/1592763209062/Forecasting-Poverty-Estimates-COVID19-CARES-Act-CPSP-2020.pdf.

[15] Tanza Loudenback, Congress Is Deadlocked Over The Next Relief Package, But A 2nd Round of Stimulus Checks Already Has the Green Light, Bus. Insider (Jul. 31, 2020, 2:50 PM),  https://www.businessinsider.com/personal-finance/second-stimulus-check-coming-proposals-details-2020-7.

[16] Joseph Zeballos-Roig, ‘An Essential Tool:’ 156 Top Economists Call for Recurring Stimulus Checks Until the Economy Recovers From the Coronavirus Pandemic, Bus. Insider (July 7, 2020, 10:41 AM), https://www.businessinsider.com/recurring-stimulus-checks-top-economists-pandemic-coronavirus-economic-recovery-2020-7.

[17] Letter from Olugbenga Ajilore, Senior Economist, Ctr. For Am. Progress, et al., Open Letter From Economists on Automatic Triggers for Cash Stimulus Payments, (July 7, 2020), , https://www.economicsecurityproject.org/wp-content/uploads/2020/07/emp_economists_letter.pdf.

[18] Press Release, Geo. Ctr. for Poverty & Inequality, Progressive Group Leaders to Congress: Major Federal Intervention Needed to Meet Scale of Crisis; Congress Must Put People Ahead of Corporations to Save Economy, (Apr. 9, 2020),http://www.georgetownpoverty.org/issues/progressive-group-leaders-to-congress-major-federal-intervention-needed-to-meet-scale-of-crisis-congress-must-put-people-ahead-of-corporations-to-save-economy/.

[19] Id.

[20] Martin Luther King, Where Do We Go From Here: Chaos or Community? 5 (Harper & Row 1st ed. 1967).