The U.S. Supreme Court on Friday agreed to decide whether charities run by religious groups have to pay unemployment taxes that cover their employees.

Most, but not all, states generally exempt religious groups from having to pay into the state’s unemployment tax system. Federal law does exempt religious schools from having to participate in the federal-state program. But the court has never ruled on the question of participation by charitable organizations run by religious groups. Now the court has agreed to tackle the question in a case brought by Catholic Charities against the state of Wisconsin.

The Catholic Charities Bureau of the Diocese Superior, Wisconsin, a non-profit corporation, is the social ministry arm of the Catholic Church. Its mission is to “carry on the redeeming work of our Lord by reflecting gospel values and the moral teaching of the church,” and it carries out that mission by “providing services to the poor and disadvantaged” without making distinctions “by race, sex, or religion.” The organization hires staff without regard to religion, instructs that the charity should be exercised “in an impartial manner towards members of other religions,” and operates “dozens of programs in service to the elderly, the disabled, the poor, and those in need of disaster relief.” In addition, the charity avowedly does not proselytize.

In light of all that, Catholic Charities applied to the state for an exemption from paying unemployment taxes for its employees. But the state labor commission refused the application, on grounds that the charitable group was engaging in activities that “are not religious, per se,” and thus are not entitled to be exempt from paying unemployment taxes.

In March, a closely divided state Supreme Court agreed, citing what it called objective criteria. The state court said that the charity’s activities were mostly secular, noting that the organization does not “attempt to imbue program participants with the Catholic faith, nor supply any religious materials.” The state court also observed that the charity “did not proselytize, did not conduct worship services, religious outreach, or religious education.” Therefore, the state court concluded, the charity is not qualified to be exempt from state unemployment taxes as a religious institution.

Catholic Charities promptly appealed to the Supreme Court, asserting that the Wisconsin decision violates the First Amendment guarantee to the free exercise of religion, as well as the separation between church and state.

The court will hear arguments in the case after the first of the year, with a decision expected by late June.

President Emmanuel Macron has selected long-time ally François Bayrou as prime minister in a bid to stabilise the political turmoil in France that has bogged down his second term.

The 73-year-old centrist’s appointment came after a tense, nearly two-hour meeting at the Élysée Palace, which sparked speculation that Macron had reconsidered other names at the last minute.

It followed a year of political instability in which Macron has now named three prime ministers — a crisis that deepened when the president called and lost early elections in July that left no party or alliance with a majority in the National Assembly.

Bayrou faces the task of building a government with sufficient cross-party support to survive a confidence vote, pass a budget and reassure financial markets and businesses rattled by the recent instability.

The crisis has undermined Macron on the international stage, just as neighbouring Germany is gearing up for early elections in February. With US president-elect Donald Trump due to take office next month, both leading EU powers are weakened by political uncertainty.

“Everyone knows the difficulty of the task and everyone also knows that there is a path forward to be found that unites people instead of dividing them . . . There is a long road ahead,” Bayrou said on Friday afternoon shortly after his appointment.

Bayrou’s predecessor, Michel Barnier, the EU’s former Brexit negotiator, was toppled last week in a no-confidence vote in the National Assembly after just under three months in office. Barnier’s government was voted down over a deficit-cutting budget for next year, a hurdle that Bayrou will now have to surmount despite having no parliamentary majority.

A three-time presidential candidate himself, the new prime minister combines a market-oriented view of the economy with support for social justice measures such as taxing the wealthy.

He has also called for proportional voting to boost the culture of compromise in parliament and more power to be devolved from Paris to the rest of the country.

But his appointment was immediately met with criticism from Macron’s opponents, including from the far-right Rassemblement National (RN) of arch Macron opponent Marine Le Pen, which was instrumental in bringing down Barnier.

“Macron is a president in a bunker, and his new prime minister must take into account the new political situation,” said Jordan Bardella, RN party chief. “He must accept that he does not have democratic legitimacy or a majority in the assembly, so must dialogue with all parties,” he added.

The moderate left, whose support is crucial to neutralising the RN, also made clear its dissatisfaction with Bayrou’s appointment.

Chloé Ridel, a Socialist party spokesperson, slammed Macron for picking an ally rather than a candidate from the left, which came first in July’s parliamentary elections.

“If Bayrou wants our support, he will have to take steps to take on parts of our agenda, such as on pensions or salaries,” she said.

A person close to Macron defended the choice, saying that Bayrou had “emerged in recent days as the most consensual figure . . . and [the one] best suited to form the government of national unity called for by the president”.

The person added: “His mission will be to engage in dialogue with all political parties . . . to establish the conditions for stability and effective action.”

The uncertainty now afflicting French politics contrasts not just with Macron’s first term, when he had a commanding majority, but with much of the history of the 66-year-old Fifth Republic, during which most governments have proved relatively stable.

Investments and growth have slowed and unemployment has ticked up during the political crisis.

France is under pressure to narrow its deficit, which will stand at 6 per cent of national output by the end of the year — far above the EU limit of 3 per cent of GDP.

Macron has sought to prepare the ground for the new government with a non-aggression pact with opposition party chiefs — excluding the far right and far left.

To cut out the RN, he and Bayrou will need to reach an agreement with the Socialists, who hold 66 seats, and perhaps the Greens with 38 and the Communists with 17, while not losing the rightwing.

Fabien Roussel, the communist party head, said the nomination of a loyalist as prime minister sent “a bad signal that is not what the public wants”, adding: “They want a change of political direction, and there is little chance of that now.”

However, in a more conciliatory tone, he added: “We will not censure this new government automatically, and will judge based on his actions.”

Much will depend on how substantially Bayrou deviates from Macron’s pro-business policies and tax cuts to chart his own course.

His support was key to Macron first getting elected in 2017 and his MoDem party supports the president. But legal difficulties forced him to step aside as Macron’s first justice minister after only one month in office.

Bayrou and his party were accused of embezzling EU funds by using Brussels staffers for national political activities. He was acquitted this year, but prosecutors have appealed, raising the possibility of a retrial.

If another prime minister were to fall, pressure would intensify on Macron, whose presidential term still has two-and-a-half years left to run, to resign to break the political impasse. 

The president has insisted he will not step down, since he wants to push through more reforms and protect previous changes such as raising the retirement age and efforts to make France more attractive to investors. 

In a survey by pollster Elabe this week, only 6 per cent of respondents said they wanted a prime minister from Macron’s centrist camp, compared with 41 per cent who preferred a non-political choice.

But a large majority of respondents — 76 per cent — said they wanted parties to find compromises to end instability, in a sign that it may be risky for the opposition to topple another government. 

Macron’s popularity has fallen to a record low since his election in 2017, with just 21 per cent of people having confidence that he can tackle France’s problems, according to a separate Elabe poll on Thursday. 

Among potential prime minister candidates, Bayrou got the backing of only 29 per cent of respondents in the same poll.

Data visualisation by Janina Conboye

A House-passed bill that would expand Social Security benefits to millions of Americans just got a lifeline in the Senate.

Senate Majority Chuck Schumer said Thursday he would start the process for a final vote on the Social Security Fairness Act, which would get rid of two federal policies that keep a portion of Americans from getting their full Social Security benefits, including cops, fire fighters and teachers. 

One living-and-breathing example is Terry Hoover, a firefighter in Louisville, Kentucky, for more than 20 years. Now retired, he says these two provisions cost his family more than $1,000 a month.

“My Social Security is reduced due to my pension,” Hoover, told fellow first responders at a rally earlier in the week, as reported by a local CBS affiliate. “And then my wife, she was a nurse for 41 years and paid into the Social Security system, you know, and I cannot draw one penny off of her because of my pension.”

Schumer, a Democrat and co-sponsor of the legislation, tweeted the bill would “ensure Americans are not erroneously denied their well-earned Social Security benefits simply because they chose at some point to work in their careers in public service.” As majority leader, he can invoke a Senate rule that would skip a committee hearing and send the bill directly to a floor vote by the full Senate. 

That’s important, as the clock is ticking as to its fate, with only days left in the current session of Congress.

Decades in the making, the bill would repeal two federal policies — the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) — that broadly reduce payments to nearly 3 million retirees. 

That includes those who also collect pensions from state and federal jobs that aren’t covered by Social Security, including teachers, police officers and U.S. postal workers. The bill would also end a second provision that reduces Social Security benefits for those workers’ surviving spouses and family members. The WEP impacts about 2 million Social Security beneficiaries and the GPO nearly 800,000 retirees.

Various forms of the measure have been introduced over the years, but like many legislative proposals, they had failed to get enacted. 

“I’ve been working at the league 25 years, and I don’t remember ever not having a version,” Shannon Benton executive director of The Senior Citizens League, or TSCL, an advocacy group devoted to protecting retirement benefits, said of the proposal, which the league supports. “We’re guardedly optimistic,” she told CBS MoneyWatch earlier in the month.

The bill had 62 cosponsors when the Senate version was introduced last year, and would now need at least 60 votes to pass Congress and then head to President Biden.

In a speech earlier this month, Louisiana Senator Bill Cassidy took to the Senate floor to call for a vote in the chamber. “If Schumer brings it up, it’ll pass,” said Cassidy, among its Republican sponsors.  

Will the Senate pass the Social Security Fairness Act?

At least one GOP senator who signed onto similar legislation last year, Sen. Mike Braun of Indiana, said he was still “weighing” whether to vote for the bill next week. “Nothing ever gets paid for, so it’s further indebtedness, I don’t know,” Braun said, according to the Associated Press. 

Opposition includes the Committee for a Responsible Budget, a nonpartisan organization committed to educating the public on issues with significant fiscal policy impact. In a statement responding to Schumer’s announcement, the group’s president, Maya MacGuineas, said it was “truly astonishing” that lawmakers would consider speeding up the trust fund’s demise.

The measure would increase the burden on Social Security’s trust funds, which are already estimated to not be able to pay the full amount of scheduled benefits starting in 2035. According to the Congressional Budget Office, the proposed legislation would add a projected $195 billion to federal deficits over a decade. 

“The Senate should reject WEP and GPO repeal. Instead, they should come together to try to fix the issues with WEP and GPO as part of a comprehensive package to strengthen Social Security, prevent insolvency and make the program’s finances sustainable over the long term,” MacGuineas urged. 

Introduced by Reps. Abigail Spanberger, D-Va., and Garret Graves, R-La., the bill was passed by the House in a vote of 327-75 last month.

If the Senate does not act, the measure “dies December 31, at the end of the second session of Congress,” Benton said. “Not only would this bill have to start from scratch, but a new person would have to introduce it.”

The Associated Press

contributed to this report.