Stimulus programs set to expire at year-end

Yahoo Finance’s Julie Hyman, Myles Udland, Brian Sozzi, and Jessica Smith discuss which COVID-19 stimulus programs are expiring soon.

Video Transcript

MYLES UDLAND: Well, the year is fast wrapping up, and that means the expiration of a number of essential programs. Perhaps the biggest story here for the Main Street economy that has gone a bit under the radar, we're looking at paid-leave programs expiring, payroll-tax deferral expiring, student-loan relief, eviction protections. All of this is pending.

Jessica Smith joins us now for more on this. And, Jess, I think I remember talking with you about the benefits cliff when the CARES Act expired back in July, but the totality of what you're going to lay out for us I think might add up to a bigger economic issue come Jan 1.

JESSICA SMITH: Yeah, I talked to some experts and an economist who said this is really a perfect storm as we're seeing all of these programs expire as COVID cases rise. This could be devastating on a personal level for individuals, but it could also slow the economic recovery.

So let's look at some of these programs that are set to expire next month. First, you have the unemployment-insurance expansions. We have those two programs, one that lets gig workers and independent contractors access benefits, the other that gives 13 extra weeks of benefits to laid-off workers. Those are set to go away right after Christmas. So reportedly millions of people could lose their benefits if those are not extended.

I did speak to Congressman Richard Neal yesterday. He's the chairman of the House Ways and Means Committee. He told me it's imperative that those are extended, and he's hopeful maybe as lawmakers try to avoid a government shutdown on December 11 that they'll be able to work out some sort of extension.

We also have the eviction ban that's set to go away at the end of the year. And renters don't just automatically have to start paying January rent. If they haven't been paying rent for the past few months, they have to pay that back. So that's why we're hearing lawmakers push for forgiveness or more relief for renters to help them pay the back rent that they may owe.

It's a similar situation with student loans. Those payments have been paused, but they're set to pick up again in January. One expert told me that that's just another example of kicking the can down the road, and there needs to be cancellation to actually make a difference for many borrowers.

And we also have paid family leave that's set to go away. One of the initial coronavirus relief bills included paid leave for some workers at businesses with fewer than 500 employees. They got paid leave if they got coronavirus or if they had to care for someone who had it or if they had to care for kids whose school was closed. That is, again, set to go at the end of the year.

And then two more, state and local aid. States and cities have to spend the money they got from the CARES Act by December 30 or it goes back to the federal government.

And then a small-business loan program, not the Paycheck Protection Program, but this is another one that allows small businesses to get emergency loans at a low interest rate. The last day to apply for that is December 21.

So again, all of these things are happening as COVID rates are rising. One economist told me that this is an antistimulus measure if Congress doesn't act here instead of moving forward with more relief that is needed.

And, of course, President Trump and President-elect Biden could do a few things to enact these, extend these provisions. But, really, it's Congress that needs to step in and make a real difference.

MYLES UDLAND: Shades of the sequester back in 2014 at the very least. Also a reminder that in a normal year or in most years, Jan 1, OK, it is a new, clean sheet of business. We're going to have a lame-duck administration with three more weeks in power there and I think a lot of anxiety over what happens over the next-- I believe it's 56 days before Joe Biden's inauguration.

All right, Jessica Smith with the latest on the goings-on down in the capital.