The coronavirus stimulus checks issued in 2020 and 2021 had an undeniable impact on American families. They helped lift people out of poverty in an economically difficult time. And in fact, for some individuals and families, they helped raise household incomes above pre-pandemic levels.
As money deposited directly into people’s bank accounts proved to be both popular and successful in reducing poverty, some lawmakers are now calling for more monthly payments.
On Friday, July 30, Rep. Ilhan Omar even introduced a bill called the Sending Unconditional Payments to People Overcoming Resistances to Triumph (SUPPORT) Act, which would provide for payments of $1,200 per month per adult and $600 per month per child. This money would be offered on an ongoing basis, unlike the one-time payments made available in each of the three coronavirus relief accounts.
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How would ongoing incentive payments work?
The Support Act does not refer to the ongoing monthly payments as incentive payments, but as a Universal Basic Income. Rep. However, Omar makes it clear that the stimulus measures against the coronavirus were the inspiration for the proposed legislation.
“The silver lining during COVID-19 has been for the federal government and local governments to recognize the urgency and effectiveness of delivering immediate resources to struggling Americans, Rep. Ilhan Omar said in a statement on The SUPPORT Act. in fact, our economy weakened and strengthened through increased consumer spending during one of the worst recessions in recent history.
Rep Omar does not believe that these stimulus payments should end with the pandemic. Instead, she feels they should become a fixture because of their poverty alleviation benefits. “It’s time for Congress to improve our communities by simply putting money back in people’s pockets,” she said.
The SUPPORT Act would do just that. Under the terms of the law, a new Treasury Department would be created to oversee a $2.5 billion grant that would fund pilot local programs to provide regular direct payments to Americans.
Based on the results of those pilot programs, the federal government would then implement a guaranteed income program for all Americans. The program would provide:
- $1,200 per month for US residents over 18 years old
- $600 per month for dependent children
The payments would phase out once income reaches $75,000 for single taxpayers; $150,000 for married joint filers; and $112,500 for householders.
If passed, pilot programs would begin distributing money to Americans in eligible communities as early as 2023. The national program that provides funds to all eligible Americans is set to begin in 2028.
For this to happen, of course, the bill must be passed by Congress and signed by the president. Although it has several Democratic co-sponsors, the chances of that happening in the current Congress, where Democrats have a small majority, are slim.
Nevertheless, the introduction of the bill makes it clear that the success of incentives can eventually lead to a policy shift, whereby the government does provide more direct financial support in the context of its poverty reduction.