Billionaire Tilman Fertitta told CNBC on Tuesday that ending the $600-per-week federal unemployment supplement will impair the U.S. economy’s recovery from coronavirus-induced damage.
“You’re going to see this economy go backwards when we cut out this $600 a week,” Fertitta, chairman and CEO of restaurant giant Landry’s, said on “Power Lunch.”
Fertitta, who also owns the NBA’s Houston Rockets, said the weekly check — which comes on top of state-level benefits — has been a major catalyst for consumer spending during the nation’s Covid-19 outbreak. And that spending has in turn created additional jobs, Fertitta argued.
“You don’t need as many employees to run this business if you’re not getting that $600 because they’re not out there spending it,” said Fertitta, adding it applies to “all these retail stores, all these restaurants, any business out there, even automotive and home repair.”
The unemployment supplement — established as part of the $2.2 trillion CARES Act passed in March — is set to be in place until Friday. However, due to a technicality with state unemployment programs, millions of Americans likely already received their final $600 weekly check.
Senate Republicans have proposed a reduced benefit of $200 a week through September. Then in October, the GOP plan proposes to replace it with a different formula that would cap total state and federal unemployment benefits at 70% of lost wages.
Democrats in Washington have expressed opposition to the Republican plan, contending a more generous benefit is needed for the more than 30 million Americans who were receiving jobless benefits as of early July. The Democratic-led House passed a $3 trillion coronavirus relief package in May that extended the $600 weekly benefit through January.
In advocating for a lower benefit, some Republicans say the $600-per-week supplement has created a disincentive for people to return to work and impeded the U.S. economic recovery as a result. Some people, particularly low-wage workers, may have made more on unemployment with the $600 weekly check than they did while employed.
“We don’t want to make it more profitable to stay home than to go back to work,” Senate Majority Leader Mitch McConnell, R-Ky., said Tuesday on CNBC’s “Power Lunch.” “That’s not what unemployment insurance is about.”
Fertitta, whose business empire includes Golden Nugget casinos and more than 600 restaurants, said he does not believe the federal unemployment supplement has been a major barrier to rehiring workers.
“We might have 20 or 30 people out of 50,000 that are taking advantage of us. Maybe 100,” he said. “But when you take this $600 out of these 25 million people’s hands, it is going to affect your economy.”