Stimulus Check Latest: Will The $1,400 Payment Survive Negotiations On The American Rescue Plan?
(CBS Detroit) -- A third stimulus check can't come fast enough for some people. The pandemic rages on, leaving a trail of suffering and economic destruction. COVID case numbers keep climbing; unemployment remains historically high. More help has been promised, in the form of a $1.9 trillion economic relief package known as the American Rescue Plan. It would include a $1,400 stimulus payment, higher unemployment insurance, an expanded child tax credit and much more if passed in its proposed form. But that's a big if. What's in the relief package, and how soon could aid reach those in need?
The American Rescue Plan aims to stop the worsening COVID-19 pandemic and prop up the economy that it continues to ravage. The Plan has three main thrusts: $400 billion to stop the advance of COVID and improve the nation's vaccination capacity; $1 trillion to financially support struggling families and $440 billion to help communities and small businesses. The proposal, in its current form, faces a potentially difficult road to becoming law.
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Economic aid accounts for a little more than half the Plan's cost. And that aid could come in many forms. Topping the list is another round of stimulus checks, amounting to $1,400 (or $2,000, when added to the $600 payments that went out at the start of the year). These direct payments have broad support across party lines, and seem likely to become a reality. It's really more a matter of how and when.
But many Republicans continue to push back against the $1.9 trillion price tag attached to the latest overall stimulus bill containing that third check. Without the support of 10 Senate Republicans, there won't be enough votes to overcome a filibuster. Democrats would have to resort to budget reconciliation, which would extend the process but reduce the vote threshold to 51. Another option, at least in theory, is to separate out stimulus checks into their own bill.
The Biden administration would like to pass the next stimulus package before the current one expires on March 14. Chuck Schumer, the Senate Majority Leader from New York, is aiming for the middle of March as well. Experts believe that the end of March is probably a more realistic timeline. Given recent experience, payments would begin to roll out a week or two later. But with tax season in full swing at that point, the IRS may encounter further delays.
A group of more left-leaning Democrats want to take it a step further. Representative Ilhan Omar of Minnesota and at least 50 other House members, including Representatives Alexandria Ocasio-Cortez of New York and Rashida Tlaib of Michigan, are advocating for $2,000 monthly payments through the end of the pandemic. The request to consider recurring payments came in a letter sent to President Joe Biden and Vice President Kamala Harris.
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According to the letter, "we are experiencing the worst economic crisis since the Great Depression, with millions of Americans either unemployed, forced out of the workforce, or facing a decline in hours and wages. Worsening systemic inequities, such as food insecurity and housing instability, are most severe for Black, Brown, and Indigenous communities, who are suffering higher infection and mortality rates of COVID-19 and higher unemployment levels, compared to white Americans. At the same time, many people of color are encountering reduced or stagnant incomes as frontline workers while not being able to access vital relief programs, such as unemployment insurance."
"Recurring direct payments until the economy recovers will help ensure that people can meet their basic needs, provide racially equitable solutions, and shorten the length of the recession," the letter continues. "One more check is not enough during this public health and economic crisis. Many families cannot afford to wait for 8 months between payments."
Beyond stimulus checks and the possibility of monthly stipends, economic relief could increase the flow of money to households in other ways. The American Rescue Plan calls for the $300 weekly federal unemployment supplement provided by the recent $900 billion stimulus package to be increased to $400 and extended through September. Those whose benefits elapsed, as well as those who don't normally qualify for benefits (i.e. freelancers and gig workers) would also be covered.
Another possible avenue for relief is an expansion of the child tax credit from $2,000 to $3,000 or $3,600, depending on the child's age and the family's income. Payments would be issued to qualifying parents on a monthly basis rather than through annual tax refunds. The IRS would pay out $300 per month for each child up to five years old and $250 per month for each child ages six through 17. The full amount would be available, regardless of a family's tax obligations.
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Low-income workers who remain employed and those lucky enough to land jobs could find themselves receiving higher paychecks. The third stimulus package also proposes raising the national minimum wage to $15 per hour and removing the exemption for tipped workers. The minimum wage has stood at $7.25 per hour since 2009, though 20 states have recently increased theirs, and four more are scheduled to do so this year. As of 2019, close to 1.6 million workers received minimum wage or less, according to the U.S. Department of Labor.
Another boost to wallets could help the economy, especially after recent news that it shrank by 3.5 percent in 2020. That was the largest single-year decline since the end of World War II. Consumer spending, which makes up 70 percent of the economy, slowed drastically in the fourth quarter. Unemployment figures remain historically high, with 847,000 applying for first-time benefits last week. That's three to four-times higher than a typical week in the two years prior to the pandemic. The Pandemic Unemployment Assistance program received another 426,000 applications. As of earlier this month, approximately 18 million people were receiving some sort of unemployment benefit.
An economic bounceback depends on the widespread distribution of a vaccine. But efforts to inoculate the public have proceeded in fits and starts. Widespread shortages forced some cities, like New York, to temporarily close vaccination centers and cancel appointments last week. Mass vaccination sites continue to open up around the country, but progress is slow. Los Angeles residents have reported three to four-hour wait times at Dodger Stadium. Fenway Park in Boston is scheduled to open Monday as a vaccination site, though it will only be able to administer 500 doses to start. Meanwhile, domestic COVID cases are approaching 26 million, with deaths exceeding 430,000.