Is this what happens when you build a real social safety net, then take it away?

IT’S A riddle that economists have struggled to decipher. The US economy seems robust on paper, yet Americans are dissatisfied with it. But hardly anyone seems to have paid much attention to the whirlwind experience we just lived through: We built a real social safety net in the United States and then abruptly ripped it apart.

Take unemployment insurance. The CARES Act, passed in March 2020, included the largest increase in benefits and eligibility in American history. It offered people “a sense of relief”, said Francisco Diez, senior policy strategist for economic justice with the Centre for Popular Democracy, which organised unemployed people in the pandemic. “A feeling like they could breathe and figure out what they could do.”

LaShondra White was one of them. When she was furloughed from her job at a Kohl’s department store in Detroit in March 2020, she started receiving more than US$600 a week. It was “my chance to get out of this situation”, she told me last year, a situation in which her pay was “horrible”. She had always wanted to own her own business, so with the extra money she fixed her credit score, rented out a commercial space and opened an eyelash studio. Her studio is still open and largely booked.