Have the odds of a $2,000 payment improved? – CBS Detroit – Community News
Stimulus Check

Have the odds of a $2,000 payment improved? – CBS Detroit

(CBS Detroit) — Before last Tuesday, a $2,000 stimulus check seemed highly unlikely. The results of the second round in Georgia, in which Democrats Jon Ossoff and Raphael Warnock won seats in the Senate, are changing the political landscape. A $2,000 payment has now become a distinct possibility in the not-so-distant future.

Congress approved a second stimulus package on December 21, and President Trump signed it on December 27. The $900 billion in economic aid expanded Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC). PUA helps unemployed freelancers and gig workers. PEUC adds 13 weeks of unemployment benefits to the number of weeks a given state offers (usually around 26 weeks). The second package also includes incentive payments of $600, as opposed to the $1,200 payments issued through the CARES Act last spring. The latest stimulus has already started pouring into people’s bank accounts and will last through January 15.

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Many economists argue that this stimulus package will not be enough to prop up a fragile economy or put the money in the hands of the right people. Many Democrats and some Republicans also feel it falls short. The effects will be better understood in the coming weeks and months. This also applies to the need for a possible third stimulus round.

President Trump also believed that the second stimulus package, specifically the one-off payments, was inadequate. He insisted on paying $2,000 while the bill lingered on his desk and millions of Americans saw their unemployment insurance voided.

The House quickly passed a bill to increase the amount of the second stimulus payment from $600 to $2,000, but the Senate did not pass the measure. Senate Majority Leader Mitch McConnell blocked a vote and instead introduced a bill that included the $2,000 stimulus along with other matters important to the president. These included the formation of a committee to investigate electoral fraud and the repeal of the Social Media Shield Act. Both were non-starters for Democrats, and the Senate bill was about nothing.

A $2,000 stimulus check would have had an uphill battle in the Senate anyway. Fiscally conservative Republicans had already abandoned a broader second stimulus package with a price tag north of a trillion dollars. They certainly didn’t support additional incentives. But it also gained some support, including from Republican Senators Kelly Loeffler and David Perdue, who were both embroiled in tight runoff election campaigns.

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Those races had a broader meaning than representation for the citizens of Georgia. Control of the Senate was at stake. With Ossoff and Warnock having the upper hand, the upper house is now split 50-50. (Democrats actually have 48 seats, but independents Angus King of Maine and Bernie Sanders of Vermont usually vote with them.) Vice President-elect Kamala Harris will cast the casting vote for all bands. And the bitter partisanship that exists suggests the likelihood of party-line votes on hot-button issues.

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Once President-elect Joe Biden takes office on January 20, Democrats will control the presidency and both houses of Congress. Their simple majority in the Senate will not give them the 60 votes to overcome a filibuster without bipartisan support. But it does give them enough votes for the president-elect to run when he takes office. That means Biden can confirm his cabinet candidates and pass legislation related to budgets and spending through a legislative process known as reconciliation.

A $2,000 incentive check is clearly tied to budgets and expenses. And it has a lot of support among Democrats. As mentioned, the House recently passed a bill to increase the incentive to $2,000. It passed the $3 trillion HEROES law in May. And House Speaker Nancy Pelosi negotiated with Treasury Secretary Steven Mnuchin on a near $2 trillion stimulus package ahead of the election.

Biden referred to the latest stimulus as a “deposit” for tackling the pandemic. In those same comments to reporters, the president-elect emphasized what he plans to ask Congress in terms of additional COVID relief. The list includes another round of stimulus checks.

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Another stimulus package could cost in the neighborhood of $1 trillion to $1.5 trillion and come into effect as early as mid-March. Then the extensions of the unemployment benefits from the second incentive package will expire.

Whether people can wait that long remains to be seen. Unemployment remains historically high. Initial claims for the week ending January 2 were 787,000, compared to the initial claims of 212,000 for the same week the previous year. The unemployment rate for November 2020, the most recent month available, was 6.7 percent, well above the 3.5 percent of November 2019.

A true economic recovery remains dependent on the coronavirus pandemic. Domestic cases are approaching 21.5 million and the death toll is over 364,000. Herd immunity requires about 70 percent of the population to be vaccinated. But vaccination coverage among the public is slower than expected. The US reportedly has the capacity to vaccinate 1 million people a day. Even at that rate, it would still be about eight months before 70 percent of the population would receive one dose (not the required two doses).

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The second stimulus package will expire in March. The chances of the country achieving herd immunity by then, bringing the economy back to somewhat normalcy, are slim. Millions of people will still need help. So the probability of a third and even a fourth stimulus package — and stimulus control — is pretty good.