CAP Action Memo: South Dakota Unemployment Rate Explodes to Historic High. 22,000 Could Lose Health Coverage

Washington, D.C. — On Friday, President Donald Trump will join Gov. Kristi Noem (R) at Mount Rushmore National Memorial in Keystone, South Dakota, for an early Fourth of July fireworks celebration and flyover. The event is expected to gather thousands of spectators—who, according to Gov. Noem, “won’t be socially distancing”—even as Trump’s own top infectious disease expert, Dr. Anthony Fauci, warns that the United States could see a rise of 100,000 new cases of COVID-19 per day. This event comes as officials in South Dakota report 800 active cases of the virus and as the country remains in the throes of the worst economic recession in nearly 100 years. The recession can be largely attributed to the Trump administration acting too slowly to contain the spread of COVID-19, failing to implement widespread testing, and refusing to take action to protect public safety. 

In South Dakota, the economic impact of President Trump’s failed coronavirus response has been particularly devastating. The unemployment rate in the state exploded from 3.1 percent in March to 9.4 percent in May. Between February and May, South Dakota lost 37,800 jobs—an 8.5 percent drop. The unemployment rates in April and May represented the highest unemployment rates in the state’s recorded history. Moreover, a new report shows that 22,000 people in South Dakota could lose their health coverage during the pandemic if the Trump-backed lawsuit to repeal the Affordable Care Act (ACA) is successful.

In previous visits to South Dakota, President Trump made sweeping promises to working families on kitchen-table issues such as health care and the economy. In reality, his administration has led the country and South Dakotans into its worst recession in nearly a century. 

Learn more about how President Trump’s policies and broken promises have hurt South Dakota families below.

Health care

Promise: President Trump promised South Dakota families: “Those with preexisting conditions will always get the quality coverage they need.” – Donald Trump, September 24, 2016

Reality: The Trump administration has doubled down on its commitment to taking health care away from millions of Americans by backing a lawsuit to repeal the ACA while offering no viable replacement plan. Below are several ways South Dakotans would be harmed if the administration succeeds in fully repealing the ACA:

• 22,000 South Dakotans would lose health care coverage during the coronavirus pandemic.
• 354,000 South Dakotans with preexisting conditions would face higher premiums or be barred from coverage altogether—a discriminatory practice that the ACA outlawed.
• The state of South Dakota would lose $200 million in federal Medicaid funding, and demand for uncompensated care would increase by $73 million, straining hospitals.

Profits and wages 

Promise: “I will be the greatest jobs president that God ever created … our poorer citizens will get new jobs and higher pay and new hope for their life.” – Donald Trump, October 5, 2016

Reality: Trump promised Americans that he would prioritize the interests of the middle class. Instead, his administration is rewriting the rules to reward corporate interests and making it harder for working Americans to get ahead: 

• The Trump-appointed director of the Consumer Financial Protection Bureau proposed rolling back restrictions on predatory payday lenders that require them to ensure borrowers can repay loans.
• The Trump administration abandoned a rule designed to ensure that middle-class workers are properly compensated for working overtime, lowering the Obama-era income threshold so that fewer workers are covered. Under Trump’s proposed threshold, South Dakotans would lose $2.9 million in overtime protections. 
• Trump’s Department of Labor weakened rules that required financial advisers to act in the best interests of their clients. Now, sophisticated investment advisers can effectively exploit consumers by offering conflicted financial advice, costing South Dakota retirement savers an estimated $73 million per year.

Taxes

Promise: “No one will gain more from tax cuts than low- and middle-income Americans.” – Donald Trump, August 8, 2016

Reality: Because of the Trump administration’s Tax Cuts and Jobs Act, the wealthiest 1 percent of all South Dakotans, whose average annual income is $1.7 million, received a tax cut of more than $88,000 last year. Meanwhile, the middle 20 percent of South Dakotans, whose average income is $52,100, got average tax cuts of just $820.

For more information on this topic or to speak with an expert, please contact Freedom Alexander Murphy at [email protected].