September: Make or Break Economic Month
Every month is an important month for the American economy. It's a huge, multifaceted machine with countless moving parts. The economy isn't just the products and freight that ship and the businesses that remain open, but also the people who go to work every single day and perform labor so that they can cash a check at week's end. The economy is people paying their bills and the power and water working and on and on. So, every single day is an important day for America's economy, and it's always in a state of flux, especially with something like COVID-19 and politicians intent on imposing restrictions because of it. Though September is going to be a special month in a few ways, and it might end up being the most important month for America's economy in the country's history.
The main reason why September is so important is that it's the month that the $300/weekly supplement unemployment payments from the federal government expire. There are still 24 states that are offering this federal supplement, and those 24 states are predictably showing much slower economic growth than the 26 states who have already done away with the supplement. Of course, that's not to say that those 26 states have discovered some secret formula for economic growth. Growth overall is still very slow in those states. Though comparing the data side by side, it's clear that the 24 states still offering added incentive to not work have many more unemployed people.
The fact is that if you pay people not to work, most people are not going to work. This is not rocket science, nor should it be some hot-button debate topic in America that polarizes the country. When people get enough money, they retire. Most people don't like working, especially in the sorts of fields that require them to wake up early every morning, travel, perform labor, and do it all over again, week after week. People win the lottery and retire. Celebrities and such who make money don't start construction jobs or go to work in retail. Most people, if they can avoid it, do not work when they do not have to. So there are a few million Americans who are making an average of $600 per week with state-based and federal unemployment, and they have decided to collect checks instead of working.
September is such an important month because it's going to dictate how things go for those people once the supplement is removed. If they decide to go back to work, that's going to greatly spur the economy. Which leads us into the second reason September is important: A potential business boom.
Tens of thousands of businesses have had to either downsize a lot of close entirely due to a labor shortage. COVID has nothing to do with this; it's all about that federal supplement. So, if people theoretically head back to work after the supplement is cut off, many more businesses will have the labor they require to open back up, which is a huge boon for our economy overall.
A Whole Lot Going On
There has been so much going on that the White House hasn't even mentioned this unemployment benefit in weeks now. The Taliban taking control of Afghanistan; oil prices surging; inflation rates spiking out of control; problems and controversies, one after the other. The Biden Administration has been completely silent on this issue. Theoretically, all that needs to happen is President Biden signing another Executive Order to extend the federal supplemental benefits, though few are confident that this is even being considered. There are just too many moving parts in America right now, and President Biden seems to be having a hard enough time pulling off a scripted 15-minute press conference once every three weeks.
So, in all likelihood, that federal supplemental unemployment payment is going to disappear, at least for a few months. After 2022 gets here, likely is the case that the Biden Administration will have enough political capital with the new year to start more spending initiatives or such payment programs. Though, for the foreseeable future, Biden is really being pressured to do something about Afghanistan, and he has already drawn $500 million out for potential refugees, not to mention the over $1 billion for immigrants who have crossed the border. To put it simply, America's money is going to people from outside of the country, so they can live here comfortably. As far as citizens being able to take advantage of the unemployment supplement after September, it seems highly unlikely.