Biden To Announce Comprehensive Stimulus Package Thursday

In a Tuesday letter, Senate Majority Leader-to-be Chuck Schumer (D-NY) announced plans for another COVID-19 relief bill that would provide $2,000 stimulus checks. He told fellow Senate Democrats that the measure would be “the first order of legislative business” after the new Congress is inaugurated on January 20.

“Democrats wanted to do much more in the last bill and promised to do more if given the opportunity,” Schumer wrote.

Another stimulus package would allocate more funding for state and municipal governments, vaccine distribution, schools, and small businesses, Schumer continued. “As our first order of legislative business, please prepare to address additional COVID emergency relief legislation.”

Both President-elect Joe Biden and Vice President-elect Kamala Harris have expressed support for a third round of larger checks. “$600 is simply not enough when you have to choose between paying rent or putting food on the table,” Biden tweeted last Sunday. “We need $2,000 stimulus checks.”

Schumer revealed that his first move was to pass a bill for the $2,000 payments last week following the Senate election results in Georgia, where Democrats Jon Ossoff and Raphael Warnock flipped both Republican-held seats. 

Schumer’s proposed legislation would include infrastructure, health care, child care, tax, immigration, and criminal justice reforms. 

Schumer pressed outbound Senate Majority Leader Mitch McConnell (R-KY) to reconvene the Senate in light of President Trump’s impeachment proceedings. During a news briefing, Schumer cited a 2004 law that gives majority and minority leaders the authority to call their respective chambers to Capitol Hill. 

“The bottom line is that Leader McConnell has the ability to call us back into session and we can then move to convict Donald Trump, draw on the impeachment trial and try him,” Schumer told reporters. “And that’s what we hope McConnell will do.

The $900 billion relief bill President Trump signed into law at the end of December allocates a second round of stimulus checks to eligible taxpayers. According to the Internal Revenue Service (IRS), over 80% of the payments were issued last week in the form of direct deposits, physical checks, and Economic Impact Payment (EIP) debit cards.

Before signing the law, President Trump criticized the bill for only giving Americans $600 instead of the $2,000 backed by the House and many Republicans. However, McConnell repeatedly barred the proposal from a Senate vote.

$2,000 Checks Would Boost Low-Earning Families’ Income More Than 25%

A recent study from the Institute on Taxation and Economic Policy (ITEP) discovered that $2,000 direct payments would increase the country’s lowest-income households by over one quarter. 

Researchers found that a larger payout under the CASH Act would benefit the bottom 20% of families with a 29% rise in income.  

In an interview with Yahoo Money, Steve Wamhoff, ITEP director of federal tax policy, observed, “That’s going to be a significant boost in their income. For people who work for Congress or people who work in policy, we can easily forget just how little money some people have.”

On the other hand, they found that $600 stimulus payments would increase incomes by a mere 8%. Incomes rose 11% with the $1,200 checks, which many experts say prevented an even larger crisis among low-income families when the pandemic first struck.

Studies found that the first round of direct payments (and the additional $600 per week in federal benefits) contributed to a growth in Americans’ personal income, spending, and savings despite the severe economic downturn. 

The country’s most impoverished families (those earning less than $21,300) would stand to benefit the most from larger stimulus checks, with the average household receiving $3,160. Income among the second-lowest 20% would increase by 12%, with an average payment of $3,530.

As well as raising the amount of the stimulus checks, the CASH Act would broaden eligibility criteria to include any dependent, regardless of their age. For both the first and second stimulus checks, only children younger than 17 qualify.

“The $2,000 payment as it’s written into the House bill is more generous even besides the fact that it’s just more money,” Wamhoff continued. “It’s also more generous because it’s going to more people.”

The Joint Committee on Taxation found that the boost would come with a $464 billion price tag. Currently, data from the Committee for a Responsible Federal Budget shows the cost at $166 billion. Altogether, more generous federal support would tack an extra $300 billion onto the stimulus bill.

Biden will outline his proposal — which is estimated to be in the “trillions of dollars” — for a comprehensive relief bill this Thursday.

 

Sources
  • Salant, Jonathan D/. “Second Stimulus Check Update: $2,000 Payments Will Be ‘the First Order of Legislative Business,’ Schumer Says.” NJ.com, 13 Jan. 2021, www.nj.com/coronavirus/2021/01/second-stimulus-check-update-2000-payments-will-be-the-first-order-of-legislative-business-schumer-says.html.
  • Tsekova, Denitsa. “$2,000 Stimulus Checks Would Be a Massive Boost for America’s Poorest.” Yahoo!, Yahoo!, 12 Jan. 2021, money.yahoo.com/stimulus-checks-massive-boost-for-poorest-182646846.html.

 

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