Some Senate Democrats urge President Joe Biden to overhaul the country’s dispensary, the direct financial aid that Congress has deployed to help millions of Americans affected by the economic collapse that followed the coronavirus pandemic.
Rather than providing discrete rounds of stimulus checks that are negotiated over and over and arrive months at a time, the federal government should provide recurring checks to help families make ends meet.is over, the 10 lawmakers said in a letter released Tuesday.
The request comes as the Senate takes up Mr. Biden’s requestthis week, which would include a third round of stimulus checks that would send $1,400 to millions of eligible Americans. Congress handed out $1,200 checks under the Coronavirus Aid, Relief and Economic Security (CARES) Act a year ago, and sent an additional $600 payment in December as part of a broader stimulus bill. The senators have not specified an amount they are seeking for monthly direct aid.
The idea of issuing recurring stimulus payments as a way to accelerate economic recovery has been championed by progressives and some Democrats. More than 50 house members in Januaryto support a proposal for $2,000 monthly payments until the pandemic ends.
Supporters of the idea point out that financial difficulties are still rife in the US, nearly a full year after COVID-19 effectively shut down the economy. Despite the ongoing recovery, a third of adults are struggling to pay their bills, while employers cut about 10 million jobs from their payrolls during the crisis, according to an analysis by the Center on Budget and Policy Priorities.
“The decades of research on stimulus controls confirm the argument that much of this is being spent, which helps stimulate the economy, and sources like the Census show that there is a huge need” for more funding despite the erratic recovery, said Claudia Sahm, a researcher. economist who has worked at the Federal Reserve and the Washington Center for Equitable Growth.
She added, “The reason we’re not in the world of 1933 when things were really bad is because the federal government and the Federal Reserve stepped in — but we’re not out of the woods yet.”
The senators who signed the letter, including Bernie Sanders of Vermont, Elizabeth Warren of Massachusetts and Ron Wyden of Oregon, argue that aid such as increased unemployment benefits has not reached all families affected by the economic crisis.
Millions “are not eligible for unemployment insurance after seeing their hours reduced, switched to lower-paying jobs or temporarily left the workforce to care for relatives during the pandemic,” they wrote in the letter. “Immediate payments are critical to supporting families in difficulty not reached by unemployment insurance.”
Cut back $1,400?
Still, such arguments are unlikely to gain traction among congressional Republicans and even some moderate Democrats, as many have already opposed the $1,400 checks that are part of Mr Biden’s US bailout plan. Some lawmakers have also urged that the third round of stimulus be distributed to fewer households by focusing on lower-income Americans.
According to the US bailout plan, a person’s income is the main determinant of whether or not to get a check, as well as the amount of payment — similar to the previous two rounds of stimulus checks.
Singles can receive $1,400 each, while married couples applying together can receive $2,800. Only individuals earning up to $75,000 would get the full payments, as would married couples earning up to $150,000. For incomes above those thresholds, payment amounts would drop and disappear completely for singles earning over $100,000 and married couples with combined incomes over $200,000.
Some lawmakers have cited research showing that higher-income families are recovering well from the economic impact of the pandemic, as a reason for lowering those income thresholds. Given that debate, many lawmakers are unlikely to support recurring incentive payments.
Still, some elements of the US bailout plan could provide a similar form of ongoing assistance to some households. First, it would send an additional $400 a week to unemployed Americans, against $300, which would be helpful for unemployed workers and their families, but not for those struggling with unemployed hours or other income losses.
The bill would also expand the tax credit for children, transforming an annual break claimed on tax returns — usually reflected in people’s annual repayments — into a monthly payment. Under the plan, the tax credit would increase from $2,000 to $3,600 for children under age 6 and to $3,000 for children under age 17. The IRS would pay the tax credit in monthly installments. That means, for example, a family with two children under the age of six could receive $600 monthly checks from the IRS.
In making their argument, the senators noted that the $1,400 probably won’t help many families for long.
“Families should not worry about having enough money to pay for the essentials in the coming months as the country continues to fight a global pandemic,” they wrote. “Nearly six in ten people say the $1,400 payments to be included in the rescue package will take less than three months.”