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COVID‐19 and the US Safety Net *
Author(s) -
Moffitt Robert A.,
Ziliak James P.
Publication year - 2020
Publication title -
fiscal studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.63
H-Index - 40
eISSN - 1475-5890
pISSN - 0143-5671
DOI - 10.1111/1475-5890.12243
Subject(s) - safety net , unemployment , covid-19 , earnings , recession , pandemic , economics , cash , net income , income support , business , labour economics , demographic economics , public economics , economic growth , finance , macroeconomics , medicine , environmental health , disease , pathology , infectious disease (medical specialty)
We examine trends in employment, earnings and incomes over the last two decades in the United States, and how the safety net has responded to changing fortunes, including the shutdown of the economy in response to the COVID‐19 pandemic. The US safety net is a patchwork of different programmes providing in‐kind as well as cash benefits, and it had many holes prior to the pandemic. In addition, few of the programmes are designed explicitly as automatic stabilisers. We show that the safety net response to employment losses in the COVID‐19 pandemic largely consists only of increased support from unemployment insurance and food assistance programmes, an inadequate response compared with the magnitude of the downturn. We discuss options to reform social assistance in the United States to provide more robust income floors in times of economic downturns.