Stimulus Controls Significantly Reduced Deprivation, Study Shows – Community News
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Stimulus Controls Significantly Reduced Deprivation, Study Shows

“It bridged a gap,” Mrs. Ray said, waiting for slower forms of help, such as rent assistance.

Then she got cancer. To confirm the diagnosis and guide her treatment, she had to contribute $600 towards the cost of a CT scan, which she did with an April payment totaling $2,800.

Besides taking care of the test, Ms Ray said, the checks brought hope. “I got really depressed and depressed,” she said. “Part of the benefit of the incentive for me was that God said, ‘I got you.’ Spiritual and emotional reassurance, it took me a lot of stress.”

Scott Winship, who studies poverty at the American Enterprise Institute, questions the reliability of the census data used in the University of Michigan study, noting that fewer than one in ten of government-contacted households have answered the biweekly surveys.

He also argued that hardships would have eased anyway, as the latest round of stimulus has coincided with tax season, which sends large amounts of money to low-paid workers through tax credits. Between the payroll tax credit and the child tax credit, a single parent with two children can receive up to nearly $8,500 per year.

Columbia University researchers estimate that poverty fell sharply in March, but Zachary Parolin, a member of the Columbia team, said about half of the decline would have happened without the pandemic relief, mainly because of the tax cuts.

Mr. Winship noted that the incentive checks awarded as much to households with incomes over $100,000 as to households under $30,000, calling them inefficient and a poor model for future policy. “It is not sustainable to give people enough money to eradicate poverty,” he said. “And in the long run, it can have negative consequences by reducing incentives to work and get married.”

Analysts have long debated the benefits of cash versus targeted aid such as food stamps or housing subsidies. Cash is easy to send and flexible to use. But targeted benefits provide greater assurance that aid is being used as intended, and they draw political support from related businesses such as grocers and landlords.