Well before he was elected governor of California or president of the United States, Ronald Reagan in 1964 said “governments’ programs, once launched, never disappear.” He added that the agencies running those programs are “the nearest thing to eternal life we’ll ever see on this earth.” Reagan didn’t live to witness the creation of the supposedly temporary “Federal Additional Compensation” (FAC) program in 2009. But he correctly described how it would end up—by continuing indefinitely.

FAC was one of scores of “timely, targeted, and temporary” benefits included in the February 2009 Obama stimulus law. Former Rep. Jim McDermott (D-WA) described its historic birth: “For the first time ever, this legislation provides a Federal supplement to increase unemployment benefits by an extra $100 a month for the next year.” That’s shorthand for unprecedented $25-per-week supplements paid to all unemployment benefit recipients. Originally authorized from February through December 2009, the payments were extended in December, again in March 2010, and yet again in April 2010. Current recipients when the program nominally closed in June 2010 could continue to receive $25 supplements as late as December 2010, when the Department of Labor (DOL) says “the FAC program ended.”

But that really was just the beginning. After spending over $10 billion in fiscal year 2010, FAC issued payments in all fiscal years since, as “states continue to report activity such as appeals, reversals, and overpayment recoveries for the program,” according to DOL. As displayed below, for most of that past decade FAC appeared to be winding down, with annual payments dropping from $53 million in 2011 to $3 million in 2019. But then the pandemic struck and spending under this supposedly temporary and long-since expired program soared in 2020 to over $218 million, a 6442 percent increase from the year before!

FAC Spending by Fiscal Year, 2010–2021

Source: Department of Labor.

What could account for that? As with too much unemployment spending in the past two years, it’s possible that fraud—especially serial attacks on individual state systems—played a role. The two largest FAC spikes in 2020 were in April and September. As displayed below, in April, half of all states reported relatively tiny overpayment recoveries (typically involving tens of thousands of dollars and most too small to be seen even in a chart magnifying them). Meanwhile, Hawaii reported over 4 million FAC payments totaling $101 million (Hawaii has 1.4 million residents).

FAC
Recoveries (Red) and Payments (Blue) by State, April 2020

Similarly, in September 2020, over 99 percent of nationwide FAC spending of $59 million was in Puerto Rico, where 2.3 million payments were reported (Puerto Rico has 3.2 million residents). Unless Hawaii and Puerto Rico decided to suddenly process millions of FAC payments after a decade of delay—in the middle of a pandemic and the greatest surge in demand for benefits in US history—something is amiss.

Regardless of the cause of that surge, that’s still not the end of FAC. The controversial $600-per-week unemployment benefit supplements provided during the pandemic were nothing more than vastly enlarged FAC payments. In fact, the legislative language in section 2104 of the March 2020 law initiating the $600 supplements is almost identical to section 2002 of the Obama stimulus law that created FAC—with the exception of $600-per-week supplements replacing the former $25 increases.

Those $600 supplements ended in July 2020 before being revived in 2021 as $300-per-week bonuses, which in turn expired (at least in the same sense that FAC “ended” over a decade ago) last Labor Day. Some lawmakers naturally proposed reviving the larger $600 supplements well after the economy reopened and their original logic evaporated. Others policymakers would make such supplements automatically payable whenever unemployment is elevated in the future. That’s what a recent Brookings Institution volume means by making unemployment “benefit generosity and duration . . . a function of economic conditions.” Secretary Janet Yellen last month called it “building the ‘pipes’ to distribute relief in a timely manner.”

That would ensure that the legacy of the FAC program, which continues to spend tens of millions of dollars now over a decade after this “temporary” program supposedly ended in 2010, continues indefinitely. It would also further confirm Reagan’s prescient quote that government programs “once launched, never disappear.”

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