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On The Money: Millions of Americans in poverty as Black, Native American wages stagnate | Jobless claims jump to 853K | Economists warn against excluding state aid from COVID-19 relief

On The Money: Millions of Americans in poverty as Black, Native American wages stagnate | Jobless claims jump to 853K | Economists warn against excluding state aid from COVID-19 relief
© Clare Mulroy

Happy Thursday and welcome back to On The Money, where the light at the end of the tunnel may have gotten a little bit brighter. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL—Millions of Americans in poverty as Black, Native American wages stagnate: More than 42 million Americans live below the federal poverty line, a figure that is virtually equal to the number of people living in poverty a decade ago, even as the economy has boomed, according to new data released Thursday by the U.S. Census Bureau.

The figures also show that the median income of Black households has increased only slightly in the same timeframe, while households headed by Native Americans and Alaska Natives remain virtually unchanged.

  • Across the nation, the median household income from 2015 to 2019 stood at $62,843, an increase of 2.3 percentage points from the decade prior.
  • Non-Hispanic whites saw their median income increase to $68,785, up about three percentage points, while households headed by Asian Americans and Hispanic Americans notched larger gains of about 8 percent and 6 percent, respectively.
  • But Black households saw their income increase just 1.9 percentage points, to $41,935. 
  • The median income of a household headed by those of American Indian or Alaska Natives grew by just 0.5 percentage points.

The Hill’s Reid Wilson breaks down the data here. 

LEADING THE DAY

Jobless claims jump to 853K as record coronavirus cases hinder economy: The number of new applications for unemployment insurance surged last week to 853,000, a jump of more than 100,000 from the previous week, amid record-high coronavirus cases that are slowing economic growth.

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  • In the week ending Dec. 5, initial weekly jobless claims rose by 137,000 from a revised total of 716,000 applications. 
  • The non-seasonally adjusted number of claims totaled 947,504 last week, rising by 228,982, according to data released Thursday by the Labor Department. 
  • Another 427,609 people applied for Pandemic Unemployment Assistance (PUA), a program created to expand jobless benefits to contractors, gig workers and others who do not typically qualify for traditional unemployment insurance. 

More than 19 million Americans were on some form of jobless aid as of Nov. 21, according to the Labor Department.

What it means: While the weekly jobless claims data can often be distorted by state backlogs, the sharp rise last week appears to be a troubling sign for the U.S. economy as the country suffers through record-breaking coronavirus cases, hospitalizations and deaths. I have more here.

Economists warn against excluding state aid from COVID-19 relief: Economists are warning that a COVID-19 relief bill without aid for state and local governments would mean passing up an opportunity to include a proven stimulus provision.

Congressional leaders are at odds over not only the price tag of a new relief measure, but what should be in it. The various proposals on Capitol Hill range from tens of billions of dollars in government aid for states, cities, tribes and territories to no funds at all.

“The most effective form of relief and stimulus for the overall economy is flexible money that states can use depending on need,” said Tracy Gordon, senior fellow with the Urban-Brookings Tax Policy Center, which is led by a former Obama administration official. The Hill’s Niv Elis explains here.

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Senate squabbling sparks shutdown threat: The threat of a brief government shutdown is growing as the annual defense bill and a stopgap funding measure hit snags that could delay them into the weekend or next week.

Senate leadership had hoped to pass both the National Defense Authorization Act (NDAA) and a one-week continuing resolution Thursday Instead, multiple senators are delaying the bills, meaning the Senate might fail to pass the stopgap measure before Friday night's deadline, raising the prospect of a government shutdown.

“It’s got to get done by tomorrow night at midnight ... or a temporary shutdown,” said Sen. John ThuneJohn Randolph ThuneGOP votes in unison against COVID-19 relief bill Senate holds longest vote in history as Democrats scramble to save relief bill Biden gets involved to help break Senate logjam MORE (S.D.), the No. 2 Senate Republican.

Thune pointed to multiple hurdles: 

The Hill’s Jordain Carney tells us more about the obstacles ahead.

 

GOOD TO KNOW

ODDS AND ENDS

  • Starbucks is set to raise its wages Monday, bringing 30 percent of its employees or "partners" above $15 an hour.
  • Op-Ed: Desmond Lachman, a resident fellow at the American Enterprise Institute, describes “Joe Biden's economic challenge”