20 million Americans Still Waiting for Stimulus Checks as Second Round is Proposed
By Claudia Smajlaj | DCI
The U.S. has lost a record 20.5 million jobs, which means the unemployment rate has risen to 14.7%. This is the highest level since the Great Depression.
President Trump signed a stimulus bill to help households affected by the Coronavirus pandemic. The economic impact payments were first introduced as a one-time payment to stimulate the economy that had been severely impacted by the virus. 130 million checks were made to Americans who qualified for the stimulus, but 20 million Americans have yet to receive payments. The first round of stimulus checks was not enough.
It is unclear what actions will be taken next, but here are the proposals being discussed in Washington:
The Democratic Monthly Economic Crisis Support Act proposal
As millions of Americans struggle to make credit card payments, Senators Kamala Harris, Bernie Sanders, and Ed Markey worked together to propose a bill called the Monthly Economic Crisis Support Act that will give most Americans up to $2,000 a month. The direct payment applies to households that make up to $120,000 throughout the Coronavirus crisis and for 3 months after it. Married couples filing jointly would receive $4,000, and parents would get $2,000 per child for up to 3 children. The senators say that this second round of stimulus checks would ensure “every U.S. resident” (including homeless and foster youth) gets paid even if they have not filed a recent tax return or do not have a Social Security number.
Republicans worry about increasing federal spending
This expensive proposal does not sit well with the Republican-held Senate, which is concerned with spending more taxpayer money to fix economic damage. Worried about increasing the amount of federal spending, Republicans are looking for ways to ensure that national debt does not become impacted by additional stimuli.
The “middle-ground” --- $5,000 stimulus check in exchange for slightly delayed social security benefits proposal
Andrew Biggs and Joshua Rauh, opinion writers of The Hill believe that a stimulus check does not work when its purpose is to stimulate the economy, but rather give households the funds necessary to pay bills and pay for essentials until the crisis passes. The proposed solution is to target the $38 trillion in Social Security benefits that households accrued as of last year but have not yet received. Biggs and Rauh argue that Congress should offer voluntary loan checks of up to $5,000 in exchange for a delay in receiving their Social Security benefits in retirement by up to three months. They argue that using targeted loans would get money into the hands of Americans who need it, without adding to the national debt, a balancing act that may receive Republican backing while still providing additional aid directly to Americans. More details can be found here, on their published opinion article.
Claudia Smajlaj is a rising sophomore at American University who is studying Finance in the Kogod School of Business. Claudia currently works at the Center for Business Communications (CBC) and is an on-staff writer for the DC Intervention.