WEBVTT - America’s Safety Net Is Failing Its Workers 0:00:00.040 --> 0:00:02.640 Hi, I'm Carol Masser and I'm Jason Kelly. It's time 0:00:02.680 --> 0:00:05.320 for one of the big features in the magazine this week. Well, 0:00:05.680 --> 0:00:08.880 in the almost three months since isolation measures were put 0:00:08.920 --> 0:00:11.760 into place to slow the spread of the coronavirus in 0:00:11.800 --> 0:00:15.720 the United States, the economy has all but collapsed, and 0:00:15.760 --> 0:00:19.160 the damage it has been swift. It certainly has Jason, 0:00:19.160 --> 0:00:21.919 and while the virus has devastated almost every economy it 0:00:22.000 --> 0:00:26.400 has touched, Americans entered the crisis in an especially vulnerable position. 0:00:26.720 --> 0:00:30.319 By June and estimated one in four American workers was 0:00:30.360 --> 0:00:33.479 out of a job. Forty million people have filed for 0:00:33.560 --> 0:00:37.120 unemployment so far. The world's wealthiest country, home to more 0:00:37.120 --> 0:00:40.199 than two fifths of all millionaires. Let that sit for 0:00:40.240 --> 0:00:43.000 a second, has one of the widest wealth gaps of 0:00:43.080 --> 0:00:46.640 any developed nation, And Jason, the country's middle class, presumably 0:00:46.680 --> 0:00:49.600 the bedrock of the economy, was in a weekend position, 0:00:49.760 --> 0:00:52.440 and things were especially bleak for minority groups when the 0:00:52.479 --> 0:00:57.000 shutdown began, especially Black Americans. A big takeaway the US 0:00:57.120 --> 0:00:59.880 also has a weak social safety net, one that is 0:01:00.000 --> 0:01:02.880 failing its workers. So here they are stories from a 0:01:02.920 --> 0:01:08.160 country that was widely unprepared for a pandemic fallout. The 0:01:08.240 --> 0:01:11.440 pandemic has sent American workers plummeting into a safety net 0:01:11.880 --> 0:01:16.800 that wasn't prepared to catch them. By Claire Steth. Chrissie 0:01:16.959 --> 0:01:19.840 Ormand de Swart was having a cookout when she learned 0:01:19.880 --> 0:01:22.960 she'd lost her job. She and her husband, Benny de 0:01:23.040 --> 0:01:27.000 Swart had spent the first week of March in Indian Wells, California, 0:01:27.200 --> 0:01:30.480 setting up for the BNP Paraba Open, a two week 0:01:30.560 --> 0:01:34.640 tennis tournament expected to draw half a million spectators. Chrissie 0:01:34.680 --> 0:01:40.080 works in event production, overseeing players walk out routines, award presentations, 0:01:40.080 --> 0:01:44.400 and other minute Benny, a camera operator and supervisor, make 0:01:44.480 --> 0:01:48.040 sure the matches look good on TV. On March eighth, 0:01:48.240 --> 0:01:50.680 the night before the qualifying rounds were set to start, 0:01:51.160 --> 0:01:53.640 the couple invited some colleagues over to the house where 0:01:53.680 --> 0:01:57.160 they were staying for a barbecue. Benny grilled salmon and 0:01:57.200 --> 0:02:00.440 steak as people debated whether Raphael nadal Or or Novak 0:02:00.480 --> 0:02:05.040 Djokovic would beat the defending champion Dominic team. Chrissy was 0:02:05.080 --> 0:02:07.640 inside getting napkins when her phone buzzed with the text 0:02:07.720 --> 0:02:11.040 from a friend. B n P is canceled. What does 0:02:11.080 --> 0:02:14.760 that mean for you, and Benny. Confused, Chrissy checked the 0:02:14.760 --> 0:02:18.679 event's website. A banner appeared announcing that because of confirmed 0:02:18.720 --> 0:02:22.440 cases of COVID nineteen in Coachella Valley, the tournament wouldn't 0:02:22.440 --> 0:02:25.560 be held. It was the first professional sports event to 0:02:25.639 --> 0:02:29.280 be canceled in the US. We were so naive about 0:02:29.280 --> 0:02:33.120 what would happen, Chrissie recalls. We thought we'd still be 0:02:33.160 --> 0:02:36.079 able to work. At the time, there were only five 0:02:36.480 --> 0:02:39.520 and fifty confirmed cases in the US. There were no 0:02:39.600 --> 0:02:43.280 stay at home orders, yet no shuttered businesses. The couple 0:02:43.320 --> 0:02:45.720 assumed they just move on to their next job, a 0:02:45.720 --> 0:02:49.359 golf tournament. For years, they had traveled the world, helping 0:02:49.360 --> 0:02:52.440 produce everything from the World Cup to the Olympics. Like 0:02:52.520 --> 0:02:55.560 almost everyone they worked with, they were freelancers, with no 0:02:55.680 --> 0:02:59.919 paid vacation time, no sick leave, no employer backed health insurance. 0:03:00.639 --> 0:03:03.520 Their only job security was that a sport was always 0:03:03.520 --> 0:03:08.079 in season Somewhere. Over the next ten days, all their 0:03:08.120 --> 0:03:11.799 gigs through August were canceled. It just kept coming and 0:03:11.840 --> 0:03:16.000 coming and coming, event after event. Chrissie says it was brutal. 0:03:16.800 --> 0:03:19.520 On the flight home to Chicago, the couple listed their 0:03:19.520 --> 0:03:23.800 monthly expenses on a cocktail napkin. Property taxes and utilities 0:03:23.840 --> 0:03:27.720 were non negotiable, but they could cancel cable the thousand 0:03:27.720 --> 0:03:30.280 dollar monthly premium they paid for health insurance through the 0:03:30.280 --> 0:03:33.760 Affordable Care Act marketplace. The pandemic wasn't the time to 0:03:33.800 --> 0:03:37.600 drop that. To keep some money coming in, Chrissy would 0:03:37.600 --> 0:03:40.160 fall back on her side job as a substitute teacher. 0:03:40.880 --> 0:03:43.040 No sooner do we land in Chicago than I see 0:03:43.040 --> 0:03:46.880 that schools are shutting down too, she says. Freelancers didn't 0:03:46.920 --> 0:03:50.600 yet qualify for unemployment. They were out of options and 0:03:50.640 --> 0:03:53.880 staring down six months with no income. They only had 0:03:54.000 --> 0:03:58.560 enough savings for two as Benny and Chrissie tallied their finances. 0:03:58.960 --> 0:04:01.360 Andrea Lockhart is working out how to pay rent on 0:04:01.400 --> 0:04:04.480 her house in Taos, New Mexico. She'd lost her job 0:04:04.520 --> 0:04:07.720 as admissions director of a local school in December after 0:04:07.760 --> 0:04:11.680 a toxic mold discovery closed the building indefinitely. As a 0:04:11.680 --> 0:04:14.840 single mother with three children under age seven, she'd taken 0:04:14.880 --> 0:04:17.720 the first two gigs, both part time that had come 0:04:17.760 --> 0:04:21.760 her way, selling women's clothing at one store and Southwestern 0:04:21.839 --> 0:04:25.560 jewelry and gifts to tourists at another. The fifteen dollars 0:04:25.560 --> 0:04:28.159 an hour she made plus six hundred and seventy six 0:04:28.200 --> 0:04:31.560 dollars in food stamps each month kept her afloat or 0:04:31.560 --> 0:04:35.360 not afloat exactly. She also owed one point five million 0:04:35.400 --> 0:04:38.159 dollars in medical bills from the birth of her youngest child, 0:04:38.440 --> 0:04:41.520 two year old Abbey, who arrived prematurely and spent a 0:04:41.520 --> 0:04:45.400 month in a neonatal intensive care unit. Lockhart let those 0:04:45.400 --> 0:04:48.839 bills go to collections. Things were tight. It was paycheck 0:04:48.880 --> 0:04:52.159 to paycheck, but I'm super diligent about my budget, she says. 0:04:53.240 --> 0:04:57.480 On March fifteen, both stores closed. Lockhart could have filed 0:04:57.480 --> 0:04:59.920 for unemployment, but the owner of the store she worked 0:05:00.000 --> 0:05:03.240 at most discouraged her from doing so. She said if 0:05:03.240 --> 0:05:06.440 I did that, it would financially ruin her. Lockhart says, 0:05:06.800 --> 0:05:10.360 I don't know how unemployment works, so I didn't. With 0:05:10.400 --> 0:05:13.080 no money coming in, she stopped paying bills and cut 0:05:13.120 --> 0:05:15.960 back on groceries. The little ones used to go through 0:05:16.000 --> 0:05:18.520 about a gallon of milk a day. Now they're only 0:05:18.520 --> 0:05:20.919 getting one cup at naptime and sum at dinner, and 0:05:20.960 --> 0:05:24.880 that's it. She says. There's a lot of crying in 0:05:24.920 --> 0:05:27.800 the almost three months since isolation measures were put in 0:05:27.839 --> 0:05:30.480 place to slow the spread of the coronavirus. In the US, 0:05:31.000 --> 0:05:34.040 the economy has all but collapsed, and the damage has 0:05:34.080 --> 0:05:37.440 been swift. A quarter of small businesses and two fifths 0:05:37.440 --> 0:05:41.080 of restaurants have closed at least temporarily by June, and 0:05:41.240 --> 0:05:44.200 estimated one in four American workers was out of a job. 0:05:44.640 --> 0:05:48.200 Forty million people have filed for unemployment so far, more 0:05:48.240 --> 0:05:52.200 than the population of California. And while the virus has 0:05:52.200 --> 0:05:56.400 devastated almost every economy it's touched, Americans entered the crisis 0:05:56.400 --> 0:06:00.760 in an especially vulnerable position. The world's wealthiest country, home 0:06:00.839 --> 0:06:04.200 to more than two fifths of all millionaires, also has 0:06:04.320 --> 0:06:07.200 one of the highest poverty rates and widest wealth gaps 0:06:07.240 --> 0:06:10.880 of any developed nation. Despite the booming stock market and 0:06:11.000 --> 0:06:14.040 robust job growth of recent years, more than thirty eight 0:06:14.080 --> 0:06:18.080 million Americans live in poverty. In January, the Federal Reserve 0:06:18.120 --> 0:06:21.760 reported that almost forty of US adults would struggle to 0:06:21.800 --> 0:06:25.520 come up with four hundred dollars in an emergency. Things 0:06:25.520 --> 0:06:28.559 were especially bleak for minority groups when the shutdown began. 0:06:29.320 --> 0:06:32.240 Black Americans have less than three percent of the country's wealth, 0:06:32.480 --> 0:06:36.400 despite making up at least of the population. They're more 0:06:36.440 --> 0:06:39.920 likely to lack access to healthcare and nutrition, which left 0:06:39.920 --> 0:06:42.920 them more exposed to the virus, and the jobs they 0:06:42.960 --> 0:06:46.040 and Latino workers tend to hold were more susceptible to 0:06:46.120 --> 0:06:49.680 layoffs than ones held by white workers. These jobs are 0:06:49.720 --> 0:06:54.479 also disproportionately consumer facing, putting minority workers at greater risk 0:06:54.560 --> 0:06:57.880 if the country reopens too quickly and infections spike again. 0:06:59.040 --> 0:07:02.839 Even the country's mid class, presumably the bedrock of the economy, 0:07:03.320 --> 0:07:06.760 was in a weekend position. According to the FED, middle 0:07:06.760 --> 0:07:10.000 class families have the smallest share of US wealth, just 0:07:10.120 --> 0:07:15.239 twenty five percent since tracking of this measure began. In 0:07:15.280 --> 0:07:19.040 the top twenty of income earners, meanwhile, have amassed seventy 0:07:20.560 --> 0:07:23.920 Adjusted for inflation, Median household income is about the same 0:07:23.960 --> 0:07:26.560 as it was twenty years ago, even as the costs 0:07:26.600 --> 0:07:31.640 of housing, healthcare, childcare, and college tuition have skyrocketed. In 0:07:31.680 --> 0:07:34.480 the nineteen eighties, middle class families used to have enough 0:07:34.520 --> 0:07:37.120 financial reserves to support about two or three months of 0:07:37.160 --> 0:07:41.320 normal consumption, says Edward Wolfe, a New York University economist 0:07:41.480 --> 0:07:45.520 who studies wealth disparity. Now it's about one week. The 0:07:45.680 --> 0:07:49.280 US also has a relatively weak social safety net, the 0:07:49.320 --> 0:07:52.960 product of decades of political inertia, a widespread belief that 0:07:53.080 --> 0:07:56.240 government is the cause of society's problems rather than a 0:07:56.320 --> 0:07:59.800 vehicle to solve them, and politicians who have railed against 0:07:59.800 --> 0:08:04.560 ex banded benefits using racist stereotypes of minorities seeking handouts 0:08:04.920 --> 0:08:10.040 I think Ronald Reagan's invocation of welfare queens. Some European countries, 0:08:10.080 --> 0:08:13.480 by contrast, were able to rely on existing social programs 0:08:13.480 --> 0:08:16.520 to ease the pain of their shutdowns, for example by 0:08:16.560 --> 0:08:19.960 subsidizing businesses so workers could keep receiving a paycheck while 0:08:20.000 --> 0:08:24.400 sheltering at home. In the US, employers rapidly shed tens 0:08:24.400 --> 0:08:27.880 of millions of people from payrolls, forcing them to apply 0:08:27.960 --> 0:08:31.320 for financial assistance with no guarantee of regaining their jobs. 0:08:32.000 --> 0:08:35.040 In May, the FED reported that almost of people who 0:08:35.080 --> 0:08:38.480 earned forty dollars or less a year, the group least 0:08:38.520 --> 0:08:40.960 likely to have health insurance or enough savings to get 0:08:41.000 --> 0:08:44.600 through the crisis, had been laid off or furloughed. This 0:08:44.679 --> 0:08:47.000 is not something you can address by just fixing the 0:08:47.040 --> 0:08:50.880 markets or pushing a big influx of money, says Sandra Black, 0:08:51.400 --> 0:08:55.600 Columbia University economist. There is something fundamental going on here, 0:08:56.120 --> 0:09:00.280 The US is really behind. The virus has posed an 0:09:00.320 --> 0:09:03.840 essential question for Americans, how will we take care of 0:09:03.840 --> 0:09:07.320 each other now and in the future. The early stages 0:09:07.360 --> 0:09:10.959 of the crisis saw a broad bipartisan support for federal intervention, 0:09:11.400 --> 0:09:14.200 including the two point to trillion dollars provided by the 0:09:14.240 --> 0:09:19.520 Coronavirus Aid Relief and Economic Security or CARES Act. It 0:09:19.559 --> 0:09:22.240 was a staggering amount of money, equivalent to about a 0:09:22.280 --> 0:09:25.840 tenth of the US's annual gross domestic product, but much 0:09:25.840 --> 0:09:28.520 of the aid was designed to be temporary, even though 0:09:28.559 --> 0:09:31.199 the needs had addressed were new only in their scale. 0:09:32.040 --> 0:09:36.000 Because they'd ignored these problems in healthier times, Legislators were 0:09:36.040 --> 0:09:39.640 forced to create entire programs on the fly. They'd essentially 0:09:39.640 --> 0:09:42.400 watched the country fall out of an airplane and only 0:09:42.480 --> 0:09:45.880 later decided to look for a parachute. The result was 0:09:45.920 --> 0:09:50.160 a shifting, friction laden response that sometimes created more problems 0:09:50.200 --> 0:09:53.480 than it solved as it unfolded. I talked to more 0:09:53.480 --> 0:09:56.520 than two dozen workers and small business owners about how 0:09:56.520 --> 0:10:00.440 they were managing. Only two of them, a cybersecurity expert 0:10:00.480 --> 0:10:03.480 in North Carolina who was confident he could find another job, 0:10:03.920 --> 0:10:06.640 and a retired General motors engineer who owned a rental 0:10:06.679 --> 0:10:10.960 property in Detroit, thought they'd emerged from the pandemic relatively unscathed. 0:10:11.720 --> 0:10:15.520 Everyone else spoke of overriding feelings of confusion and uncertainty. 0:10:16.160 --> 0:10:19.440 Nobody knew what was going on, and so I tracked 0:10:19.480 --> 0:10:26.400 the chaos. On March sixteenth, Bob Bernstein called his managers 0:10:26.400 --> 0:10:29.400 in for an emergency meeting. For twenty seven years, he'd 0:10:29.400 --> 0:10:32.880 owned Bongo Java, a collection of six coffee shops and 0:10:32.960 --> 0:10:37.720 casual restaurants in Nashville. Bernstein's sweet potato biscuits and pork 0:10:37.760 --> 0:10:41.760 belly scrambles had inspired a devoted following, and he'd built 0:10:41.840 --> 0:10:46.000 robust wholesale bakery and coffee bean businesses to his one 0:10:46.400 --> 0:10:49.480 and fifty employees could get health insurance, and his managers 0:10:49.520 --> 0:10:52.040 got as much as three weeks of paid vacation every year. 0:10:52.720 --> 0:10:55.479 Aside from one outlet that was destroyed by a tornado 0:10:55.559 --> 0:10:59.160 earlier this year, he'd never closed a store, not even 0:10:59.200 --> 0:11:01.800 after the two thou and seven and eight financial crisis. 0:11:02.520 --> 0:11:06.160 People still drink coffee in a recession, he says. The 0:11:06.240 --> 0:11:09.520 day Bernstein called the meeting, though there were forty hundred 0:11:09.600 --> 0:11:13.080 confirmed cases of coronavirus in the US, twenty five of 0:11:13.120 --> 0:11:16.040 them in Nashville. The city was still a week away 0:11:16.040 --> 0:11:19.160 from closing its shops and restaurants, but he was concerned 0:11:19.160 --> 0:11:22.280 for his workers safety. Do we try to employ people 0:11:22.360 --> 0:11:24.560 or do we shut down to not spread virus, he 0:11:24.600 --> 0:11:28.520 recalls thinking. At first, his managers agreed to stay open. 0:11:29.120 --> 0:11:32.160 Then San Francisco announced a shelter in place order and 0:11:32.200 --> 0:11:35.240 the White House recommended that people stay home for fifteen days. 0:11:35.880 --> 0:11:39.760 That was it, Bernstein says. We had to close Bongo 0:11:39.880 --> 0:11:43.200 Javas chefs cooked all the perishable food and packed it 0:11:43.280 --> 0:11:46.960 up for their coworkers. Bernstein wanted to keep everyone on 0:11:47.040 --> 0:11:50.040 his payroll so they wouldn't lose their health insurance, but 0:11:50.160 --> 0:11:53.240 his policy stipulated that covered employees had to work at 0:11:53.280 --> 0:11:56.760 least thirty hours a week. He contacted his insurer to 0:11:56.800 --> 0:11:59.800 see if the rule would be suspended, then tried calculating 0:12:00.000 --> 0:12:03.400 on go Java's share of the premiums. He soon realized 0:12:03.400 --> 0:12:05.839 that the company couldn't afford to cover everyone even if 0:12:05.880 --> 0:12:08.520 his insurer waived the thirty hour rule, and that he 0:12:08.600 --> 0:12:11.960 definitely couldn't keep paying their salaries. He had to lay 0:12:11.960 --> 0:12:15.760 off all but four of his employees. I couldn't even 0:12:15.760 --> 0:12:19.160 do it in person, Bernstein says, I would have, but 0:12:19.240 --> 0:12:22.640 we weren't supposed to meet in large groups. His manager 0:12:22.720 --> 0:12:25.520 spoke with staff who were in that day. Everyone else 0:12:25.559 --> 0:12:28.000 got an email. I told them they have to go 0:12:28.040 --> 0:12:31.480 on this Cobra thing, which I don't totally understand. He says. 0:12:32.320 --> 0:12:34.760 He was referring to the federal program that allows the 0:12:34.760 --> 0:12:38.240 newly unemployed to temporarily extend their health coverage by paying 0:12:38.240 --> 0:12:42.400 the full premium plus a two percent administrative charge. Only 0:12:42.440 --> 0:12:44.960 one of the many workers I spoke to considered Cobra 0:12:45.040 --> 0:12:48.440 a viable option. The rest said it was too expensive. 0:12:49.160 --> 0:12:52.079 In the early days of the pandemic, several House Democrats 0:12:52.120 --> 0:12:56.360 proposed subsidizing Cobra premiums, as Congress did in two thousand nine, 0:12:56.720 --> 0:12:59.679 but the proposal didn't make it through the House. The 0:12:59.720 --> 0:13:02.920 god did little to address that millions of Americans were 0:13:02.920 --> 0:13:06.120 losing their health insurance. A study published in the Annals 0:13:06.120 --> 0:13:09.480 of Internal Medicine on April seven, just two weeks after 0:13:09.520 --> 0:13:12.120 the law passed, put the number of Americans who had 0:13:12.160 --> 0:13:16.040 lost employer provided coverage at seven million. The for profit 0:13:16.080 --> 0:13:19.880 hospital system Health Management Associates estimated that the number could 0:13:19.880 --> 0:13:22.520 top thirty five million by the time the pandemic has 0:13:22.600 --> 0:13:26.400 run its course. Even a reduction in hours was enough 0:13:26.440 --> 0:13:30.640 to make people lose coverage. Jessica Hodge, a behavior specialist 0:13:30.679 --> 0:13:33.760 who works with autistic children in Virginia, had this happened 0:13:33.760 --> 0:13:37.280 to her. She's pregnant, and when she told her employer 0:13:37.360 --> 0:13:40.720 she was uncomfortable making house calls without protective gear, the 0:13:40.800 --> 0:13:43.679 company said it couldn't provide any. She was given the 0:13:43.760 --> 0:13:46.480 choice of quitting or dropping to part time and losing 0:13:46.480 --> 0:13:50.959 her insurance. She chose the latter. It's scary, Hodge says, 0:13:51.360 --> 0:13:54.840 who wants to lose their insurance when they're pregnant. Those 0:13:54.840 --> 0:13:57.720 who lost their jobs didn't find the exchanges created under 0:13:57.720 --> 0:14:00.640 the Affordable Care Act to be much help either. The 0:14:00.720 --> 0:14:03.080 plans I found came out to about a thousand dollars 0:14:03.080 --> 0:14:05.560 a month. Who has an extra thousand dollars a month 0:14:05.640 --> 0:14:08.840 right now? Asks Marie O Bauschon, who was laid off 0:14:08.880 --> 0:14:11.720 from her job hauling sand for a Texas fracking company. 0:14:12.360 --> 0:14:16.319 Oh Buschon has Lupus and Eller's Danlos syndrome, both of 0:14:16.360 --> 0:14:19.880 which caused severe joint pain. I'm just taking tail in 0:14:19.920 --> 0:14:23.640 all and trying to muddle through. As Bernstein was closing 0:14:23.680 --> 0:14:27.360 down Bongo Java Briggs, Anderson was having a different problem 0:14:27.400 --> 0:14:31.400 in Montana. Three of his employees had gotten sick, two 0:14:31.440 --> 0:14:35.840 of them with symptoms consistent with COVID nineteen. Anderson owns 0:14:36.000 --> 0:14:39.480 seven Jiffy Lubes that collectively employ about forty eight people. 0:14:40.160 --> 0:14:43.200 He wouldn't have to close up automotive repair shops have 0:14:43.240 --> 0:14:46.800 been declared essential businesses, but people weren't bringing in their 0:14:46.840 --> 0:14:50.000 car unless they absolutely had to. In the first week 0:14:50.040 --> 0:14:54.680 of Montana's shutdown, his sales dropped thirty percent. Anderson isn't 0:14:54.720 --> 0:14:57.960 sure if his workers actually had the virus. No one's 0:14:57.960 --> 0:15:01.520 getting tested out here, he says. He offers health insurance, 0:15:01.560 --> 0:15:04.200 but given that his employees make twenty five thousand to 0:15:04.240 --> 0:15:07.840 forty thousand dollars a year and premiums are expensive, only 0:15:07.840 --> 0:15:10.760 about a fifth of them opt for coverage. The rest 0:15:10.800 --> 0:15:14.800 either qualify for Medicaid or go without. As a result, 0:15:15.200 --> 0:15:18.680 just one of Anderson's sick employees sought medical attention a 0:15:18.800 --> 0:15:21.120 tell a health visit with a nurse who told him 0:15:21.160 --> 0:15:23.360 he couldn't get tested, but to go ahead and self 0:15:23.400 --> 0:15:27.640 quarantine for two weeks. Twelve u estates have paid sick 0:15:27.720 --> 0:15:32.080 leave laws, but Montana isn't one of them. Anderson knew 0:15:32.080 --> 0:15:33.920 what a burden it would be for his workers to 0:15:33.960 --> 0:15:37.000 stay home. I told them I'd make sure they were okay, 0:15:37.160 --> 0:15:40.760 he says. He wound up paying about four thousand dollars 0:15:40.760 --> 0:15:43.880 so they could take twenty five days off combined. How 0:15:43.880 --> 0:15:47.000 many people can I realistically do that for, he asks, 0:15:47.440 --> 0:15:50.600 The lack of testing exacerbates the problem. You stay home 0:15:50.640 --> 0:15:52.680 for two weeks and I pay you for two weeks, 0:15:52.920 --> 0:15:55.120 but I don't even know if you have it. That's 0:15:55.120 --> 0:15:57.480 an expensive way to do things. There has to be 0:15:57.560 --> 0:16:00.560 a better way. Workers can't just rely on getting paid 0:16:00.560 --> 0:16:03.680 out of the goodness of my heart. The goodness of 0:16:03.720 --> 0:16:07.680 an owner's heart approach doesn't scale well either. For years, 0:16:07.720 --> 0:16:10.720 the Cheesecake Factory gave its restaurant workers the option to 0:16:10.720 --> 0:16:13.200 have money set aside from their paycheck for a help 0:16:13.360 --> 0:16:15.880 fund that would provide as much as a thousand dollars 0:16:15.920 --> 0:16:20.040 to cover shelter, food, utilities, and or childcare in the 0:16:20.040 --> 0:16:23.920 event of an emergency. On March nineteenth, the company furloughed 0:16:23.960 --> 0:16:27.640 forty one workers, which left it facing tens of millions 0:16:27.640 --> 0:16:31.240 of dollars in potential payouts. The same day, the chain 0:16:31.320 --> 0:16:34.440 sent an email telling employees that loss of income due 0:16:34.480 --> 0:16:39.080 to the pandemic does not meet help Fund grant requirements. Instead, 0:16:39.120 --> 0:16:41.160 it was establishing a two and a half million dollar 0:16:41.240 --> 0:16:44.440 COVID nineteen assistance fund, which would pay up to five 0:16:44.520 --> 0:16:48.440 hundred dollars to those most impacted. So many people applied 0:16:48.440 --> 0:16:51.360 for the assistance fund that the company had to temporarily 0:16:51.440 --> 0:16:56.080 pause the application process. After four days, it was briefly restarted, 0:16:56.400 --> 0:16:59.400 then shut down again. I've been paying into the help 0:16:59.440 --> 0:17:02.320 fund for seven years. I couldn't even tell you how 0:17:02.400 --> 0:17:05.560 much I've contributed, says caid Stone, a server at a 0:17:05.600 --> 0:17:10.080 cheesecake factory outside Dallas. What was the point? A spokesperson 0:17:10.119 --> 0:17:12.560 for the company said it had distributed almost two and 0:17:12.560 --> 0:17:18.280 a half million dollars, but otherwise declined to comment. Other 0:17:18.359 --> 0:17:21.159 countries have been managing to keep people at home without 0:17:21.240 --> 0:17:25.160 mass unemployment and all the problems that come with it. Denmark, 0:17:25.240 --> 0:17:27.920 for example, poured the equivalent of an eighth of its 0:17:27.960 --> 0:17:32.320 GDP into a program that guarantees sevent of workers salaries 0:17:32.359 --> 0:17:36.240 for at least thirteen weeks. Germany relied on a similar 0:17:36.320 --> 0:17:39.520 century old program that pays the majority of salaries when 0:17:39.520 --> 0:17:42.800 there's a temporary shortage of work. When the pandemic hit, 0:17:43.080 --> 0:17:46.080 the program was already so well funded that officials didn't 0:17:46.080 --> 0:17:48.680 need to do much beyond relaxing the rules for applying. 0:17:49.600 --> 0:17:53.040 One advantage of this approach is that when the economy restarts, 0:17:53.200 --> 0:17:56.040 workers and employers don't have to scramble to find or 0:17:56.119 --> 0:18:00.720 fill new jobs. It also reduces paperwork. In Arch, Germany 0:18:00.760 --> 0:18:03.040 had to process only the four hundred and seventy thousand 0:18:03.119 --> 0:18:07.560 applications filed by companies rather than nine million unemployment claims 0:18:07.560 --> 0:18:11.560 from their employees. That helped money get out faster. I 0:18:11.640 --> 0:18:15.120 haven't had to do anything, says Liliya Prelevich, who manages 0:18:15.160 --> 0:18:18.040 a clothing store in Denmark. I didn't miss a paycheck. 0:18:18.520 --> 0:18:21.399 In general, I felt quite calm about the whole situation. 0:18:21.960 --> 0:18:25.080 The Cares Act did include temporary provisions meant to keep 0:18:25.119 --> 0:18:29.280 Americans employed, notably a paycheck protection program that offered three 0:18:29.320 --> 0:18:33.480 hundred forty nine billion dollars and potentially forgivable loans, but 0:18:33.560 --> 0:18:37.040 it implemented all sorts of restrictions. Companies had to hire 0:18:37.080 --> 0:18:41.000 back of their workforces and use the money within eight weeks, 0:18:41.040 --> 0:18:45.080 for example, and was designed to end on June. The 0:18:45.119 --> 0:18:47.199 rest of the CARES Act focused on what to do 0:18:47.280 --> 0:18:50.119 once millions of people were already out of work, adding 0:18:50.160 --> 0:18:53.840 six hundred dollars to states weekly unemployment payouts and creating 0:18:53.880 --> 0:18:57.960 the Pandemic Unemployment Assistance or p U, a program which 0:18:57.960 --> 0:19:01.440 allowed fifty seven million self employ a freelance, and contract 0:19:01.480 --> 0:19:04.920 workers to qualify for unemployment insurance for the first time. 0:19:05.680 --> 0:19:09.080 It also sent a one time twelve check to adults 0:19:09.080 --> 0:19:12.399 whose income was below a certain threshold last year, plus 0:19:12.480 --> 0:19:16.040 five hundred dollars per child. There was a big difference, though, 0:19:16.080 --> 0:19:19.600 between what the CARES Act offered and what many people experienced. 0:19:20.119 --> 0:19:24.600 Take unemployment insurance. It's a complex partnership whereby states administer 0:19:24.760 --> 0:19:27.280 the payouts while the federal government covers some of the 0:19:27.320 --> 0:19:32.240 administrative costs, such as payroll and tech support. In recent years, 0:19:32.280 --> 0:19:36.800 many states have cut unemployment insurance funding dramatically, while federal 0:19:36.840 --> 0:19:39.679 contributions have been funded through a payroll tax stuck at 0:19:39.680 --> 0:19:42.680 the same level six percent of a worker's first seven 0:19:42.720 --> 0:19:48.480 thousand dollars in salary. Since during the two thousand eight recession, 0:19:48.560 --> 0:19:51.639 we had twenty two hundred employees. Right now, we're at 0:19:51.680 --> 0:19:55.679 about a thousand, says Kersher Cartwright, director of Communications at 0:19:55.680 --> 0:19:58.680 George's Department of Labor. We're hiring folks, but we don't 0:19:58.720 --> 0:20:01.600 have time to train them. All of us are helping customers. 0:20:02.280 --> 0:20:05.720 In one month, the state processed one million unemployment claims, 0:20:05.960 --> 0:20:09.800 which worked out to about one in seven working age Georgians, 0:20:09.840 --> 0:20:13.600 but there was a backlog of many more across the country. 0:20:13.600 --> 0:20:18.040 Decrepit state websites crashed. People spend hours filling out forms 0:20:18.119 --> 0:20:21.680 only to lose their work. At one point, Florida's online 0:20:21.680 --> 0:20:24.800 and phone systems were so overwhelmed the state asked people 0:20:24.840 --> 0:20:29.200 to mail paper applications instead. In Illinois, the diswarts spent 0:20:29.280 --> 0:20:31.760 a week trying to get the unemployment website to work. 0:20:32.200 --> 0:20:34.840 We tried for a couple of days, Benny says. I 0:20:34.960 --> 0:20:38.920 finally got up early one morning, six o'clock. Chrissie interjects, 0:20:39.119 --> 0:20:41.280 I clicked and clicked, and at about eight a m. 0:20:41.359 --> 0:20:44.639 I got through the p U, A fund they and 0:20:44.720 --> 0:20:47.880 other freelancers have been applying for, is designed to expire 0:20:47.960 --> 0:20:51.639 on December thirty first. Some states, such as California and 0:20:51.640 --> 0:20:55.760 New York incorporated it into their existing unemployment application process. 0:20:56.320 --> 0:21:00.320 Others asked people to first apply for regular unemployment, get 0:21:00.359 --> 0:21:04.320 formally denied, and then reapply for the new fund, delaying 0:21:04.359 --> 0:21:09.160 payments and causing widespread confusion. Three weeks after the diswards applied, 0:21:09.480 --> 0:21:12.240 Chrissy was notified that she'd qualified for seven dred and 0:21:12.320 --> 0:21:15.200 forty one dollar a week, including the six hundred dollars 0:21:15.240 --> 0:21:19.440 from the Cares Act before taxes. She didn't understand why 0:21:19.440 --> 0:21:22.680 it was so low. There's no explanation, just a deposit 0:21:22.720 --> 0:21:26.040 in the bank account, she says. Benny didn't hear anything 0:21:26.080 --> 0:21:29.760 at all. The forty million people who filed for unemployment 0:21:29.840 --> 0:21:32.480 so far are just a portion of those out of work. 0:21:33.119 --> 0:21:36.159 Tiffany Black isn't counted in that figure, even though she 0:21:36.200 --> 0:21:39.439 was among nine hundred employees laid off by Airbnb on 0:21:39.520 --> 0:21:43.040 May five. Black, who had been a senior marketing manager 0:21:43.080 --> 0:21:46.240 at the company's headquarters in San Francisco, hasn't applied for 0:21:46.320 --> 0:21:50.040 unemployment because Airbnb is paying her severance until July six. 0:21:50.720 --> 0:21:52.520 Once it runs out and she has to rely on 0:21:52.560 --> 0:21:56.840 the state program, she'll be in trouble. California's average unemployment 0:21:56.840 --> 0:21:59.040 payment is three hundred and thirty eight dollars a week, 0:21:59.560 --> 0:22:01.919 not enough to live on in the Bay Area, and 0:22:02.000 --> 0:22:05.480 the six Cares Act bonus ends right around the time 0:22:05.560 --> 0:22:08.840 she'd likely to start receiving payments. You're going to have 0:22:08.920 --> 0:22:11.960 all these tech workers and other salary people needing help 0:22:12.119 --> 0:22:14.760 right as this runs out, she says. I don't think 0:22:14.800 --> 0:22:19.080 anyone realizes that yet. Last year, Black gave up a 0:22:19.119 --> 0:22:22.560 more expensive apartment closer to her former office, but even 0:22:22.600 --> 0:22:25.360 the cheaper one she found outside the city costs two 0:22:25.400 --> 0:22:29.000 thousand dollars a month. She's also forty five thousand dollars 0:22:29.000 --> 0:22:31.040 in debt from a failed attempt to start her own 0:22:31.040 --> 0:22:34.119 business last year. She plans to look for a new job, 0:22:34.480 --> 0:22:36.760 but if that doesn't work out, I'm going to have 0:22:36.840 --> 0:22:38.760 to pack it up and move home to New Jersey 0:22:38.800 --> 0:22:42.440 and live with my mom. She says. I'm forty years old. 0:22:43.400 --> 0:22:47.200 Also uncounted in unemployment statistics are those who have found 0:22:47.240 --> 0:22:51.080 the system too daunting. I looked into unemployment insurance, but 0:22:51.200 --> 0:22:54.040 I can't tell if it applies to me, says Tabitha Driver, 0:22:54.520 --> 0:22:56.960 a twenty one year old housekeeper and hair stylist in 0:22:57.040 --> 0:23:00.520 New Olm, Minnesota. When the freelancer try to apply for 0:23:00.640 --> 0:23:03.720 unemployment in early April. The website said the state was 0:23:03.800 --> 0:23:06.800 waiting for guidance on p u A from the federal government. 0:23:07.359 --> 0:23:09.880 Because her parents claimed her as a dependent on last 0:23:09.960 --> 0:23:13.400 year's tax returns, she wouldn't be getting a tw stimulus 0:23:13.440 --> 0:23:17.280 check either. Her parents got the five dollar bonus for her, 0:23:17.720 --> 0:23:19.800 but her mom is also out of work now. She 0:23:19.880 --> 0:23:23.360 told her parents to keep the money. Driver is among 0:23:23.440 --> 0:23:29.200 the estimated percent of Americans without savings. I have zero income, none, 0:23:29.359 --> 0:23:32.920