It is notable that the Democrats in the Congress are tightly united under President Joe Biden’s administration’s leadership. They have a common goal of reducing economic inequality caused by the pandemic.
The coronavirus rescue legislation of Biden introduced $1,400 relief checks to qualified Americans. Such a move was able to catch the attention of the people. However, there are still multiple provisions in the $1.9 trillion economic package that can produce a long-term positive impact on the economy. If appropriately implemented, these policies would help curb income disparities.
Various congressional committees started to organize themselves to roll out the provisions in the economic package, while the people are glued to the impeachment trial of former United States President Donald Trump. With its recent draft of the bill, we can see that the current Congress members will try to uplift the standing of Americans who belong to the working class. They will do this by extending the subsidies of health insurance, providing child tax credits to families, and paying for child care costs so that all parents will be able to work conveniently without any worries.
The draft also proposes to give subsidies for the employment of low-income Americans who don’t have any children.
There is also a provision of doubling the minimum wage of the working class to $15 per hour for the next five years. However, Democratic lawmakers are expecting that such a move would be restricted by the special budget rules, which is favorable if they want to prevent a filibuster from the Republicans.
But even without the wage hike, the existing provisions in the stimulus package already have a substantial impact. It would reduce the number of hungry and needy children. It would also provide coverage to families that are not covered by health insurance. The smooth passage of these provisions is an aftermath of the successes sustained by the Democrats in Georgia. Unexpectedly, Democrats were able to get a narrow control of the Senate and Congress. This is the kind of momentum, unification, and opportunity that previous Democrat Presidents Barack Obama and Bill Clinton could only wish for.
“There’s more Democratic unity than ever on taking bold steps on an economic dignity compact,” Gene Sperling said, the author of a book that narrated his experience of serving under the recent Democratic presidents. “(It’s) possible for 2021 to be one of the greatest years of progressive accomplishment in the past century.”
Interestingly enough, Biden’s rescue package has not given enough attention and emphasis. One possible reason for this is that the economic provisions in the said legislation to curb the coronavirus pandemic effects have been drafted as tentative measures.
However, Biden and the majority of the Democrats have no intentions of making them temporary. Even former US President Donald Trump did not intend to have his 2017 personal income tax cut policy end after a decade. They have to adhere to this budget rule to prevent skyrocketing deficits in the country’s budget.
Similar to the tax cuts of Republicans, the Democrats will also have to utilize the expiration date of their tax cuts to compel Congress to stretch the temporary economic benefits to low-income families in the United States. Regardless of how long these sustenances last, they will still generate favorable effects.
In fact, the Congress’ Joint Tax Committee estimated that these extended health insurance benefits, child care credit, child tax credit, and other forms of tax credits would have a total value of $125 billion in 2022.
The Child Tax Credit, for instance, would give $300 monthly checks to all low-income families with children under six years old. According to the liberal advocacy group Center on Budget and Policy Priorities, the said tax credit would rescue 4.1 million of 40% of children from plummeting poverty.
Meanwhile, the expanded Earned Income Tax Credit is estimated to benefit 17 million low-income workers without kids. If implemented, it would almost triple their maximum credit to roughly $1,500. It would also increase the income cutoff to $21,000 from the original cutoff of $16,000. The child care tax credit is intended to reduce the cost of child care by half. It is designed for families whose annual income is less than $125,000.
The COVID relief bill also has health care provisions that would provide assistance to Americans whose income is less than 400% to get coverages from the Affordable Care Act. For low-income workers and unemployed individuals, the said coverage would be made free.