The IRS paid nearly $ 167 million for the third round of direct stimulus, with an additional 1.8 million people expected to receive a check for $ 1,400 this week. However, some lawmakers are calling for a fourth incentive to effectively continue paying until the pandemic is over.
So far, the response to the economic crisis brought on by the federal government has beenThe Coronavirus Relief and Economic Security Act of March 2020 provided for $ 1,200 to $ 3,200 per eligible adult. $ 600 for the December bailouts. And $ 1,400 based on the US relief program signed by President Joe Biden in March.
Despite such financial support, millions of Americans are still struggling financially, with four in ten earning below pre-pandemic levels, according to a study by financial services company Transunion. Say that.
Almost 16 million people across the country are in some way supported by the unemployed. Analysis This is a collection of early May census data.Much higher than the 3.5% before the pandemic, unemployment remains high, especially in low-wage sectors such as restaurants and hotels. One in four Americans struggled to pay for their household last week, according to the Center for Budget and Policy Priority.
So for many, the last round of a check for $ 1,400 may not last long. Change.org petition It forces lawmakers to pass a $ 2,000 monthly recurring payment law that began last year.People suffering from unemployment and a weak labor market. In fact, over 2.2 million people have signed it.
Some lawmakers have embraced this idea. 21 Senators-All Democrats- Signed the letter on March 30 He stressed that the $ 1,400 payment distributed by the IRS would not last long and reported to Mr. Biden in support of the regular stimulus payments.
“Almost six in ten people will pay $ 1,400 in bailouts for less than three months,” the senator said in a letter.
Meanwhile, millions of Californians to send Based on the multibillion-dollar spending plan he presented earlier this month, residents of the state received a $ 600 incentive, and about two-thirds of Californians paid the incentive. at his suggestion. Can be received.Due to a new initiative by Governor Gavin Newsom. His plan is
A letter from the US senator does not specify the amount of the payment they are asking for, but another initiative from the Democrats in JanuaryA check for $ 2,000 each month until the end of the pandemic. Instead, the American Rescue Plan approved $ 1,400 for each eligible adult and dependent.
According to a recent study, so far, people who have been paid for three stimuli have reported that most of their money is spent on debt repayment and savings. Analysis From the Federal Reserve Bank of New York. This may indicate that people are spending their money to reduce the debt they owe during the pandemic and build emergency funds in the event of another shock.
Still, many say they intend to spend their stimulus funds for the most part – the costs of food and shelter have been listed as the top two uses of the stimulus check after savings. February poll From Bloomberg / Morning Consult.
Nearly seven in ten Americans who have received or plan to receive a third payment say the third payment is important to short-term finances. Bankrate.com Mentionned During April. Although the number of unemployed rose from eight to ten when the March 2020 pandemic spread, the proportion of people needing extra help continues to rise after more than a year, finance companies say individual. keep on going.
According to the survey, around 1 in 3 people say stimulus aid helps less than a month.
Still alive to pay the salary
Some leading economists are seeking more direct help from Americans. Signed by over 150 economists, including former Obama administration economist Jason Furman. letter Last year he repeated “the payment of a direct stimulus that continues until the economy recovers.”
The economy is improving, Study in March From economist Eliza Forsythe.The policy of Humanity Forward, a nonprofit organization that promotes regular stimulus payments, as millions continue to suffer from reduced incomes and do not have access to government aid programs. said director Greg Nasif. According to a survey, only 4 out of 10 unemployed have actually received unemployment benefits.
Some may never have applied for unemployment benefits because they thought they were not eligible, while others may have given up due to long waiting times or others. problems.
“You’ll see reports of how the economy is starting to grow, but many Americans live to pay their wages, and for many Americans, government bailouts can help. I didn’t, ”Nasif said.
What is the possibility of a fourth dunning check?
Don’t hold your breath, according to Wall Street analysts. Raymond James analyst Ed Mills told CNBC “it’s unlikely at this point,” in part because of the Biden administration.It will rebuild the economy by rebuilding dilapidated schools, roads and airports, and investing in projects ranging from affordable housing to broadband.
The White House says it can raise funds by raising the corporate tax rate from 21% to 28%, with some Democrats highlighted by Brian Gardner, chief Washington policy strategist at Stifel.
Even so, only about a third think the US bailouts are of great help to them. Politico Harvard PollThis shows that some households feel they need more help to survive in the coming months.
Families with children under the age of 18 will be able to receive direct payments for six months thanks to the revised child tax credit, and many households will receive some form of additional incentive this summer. From July to December, families with children under 6 receive $ 300 per month, and families with children aged 6 to 17 receive $ 250 per child per month.
“A lot of people will be surprised when the first check arrives,” Nasif said. “This will obviously stimulate the growing popularity of checks. “
If Biden becomes president, his family could benefit from even more tax cuts in the years to comeAdvanced. As part of this plan, the expansion of child tax credits will continue through 2025, providing families with deeper tax cuts for their children for four more years.
At the same time, increasing COVID-19 vaccination rates and the reopening of the state are expected to help the economy recover this year. JPMorgan Chase CEO Jamie Dimon Predicted In His Past Year letter Prosperity for shareholders ..
“[W]Excessive savings, savings from new stimuli, huge deficit spending, etc. [quantitative easing by the Federal Reserve]The U.S. economy is likely to be booming, with potential new infrastructure bills, effective vaccines, and euphoria as the pandemic ends. This boom could easily take place in 2023, as all spending could last until 2023, ”Dimon wrote in a letter on April 7.
This could reduce why the government is providing more direct aid, especially as unemployment recovers and more workers move away from passers-by.
By the end of the year, the country’s unemployment rate could drop to 4.3%, according to Oxford Economics. Despite this, four million workers are unemployed and the road to recovery is “long,” Oxford economists Oren Clarkkin and Gregory Dako said in a study note.
They predict the job market is poised to make impressive strides in the future, as increased vaccine distribution, reopening and fiscal stimulus will lead to spikes in employment.
Source link Fourth Incentive Check – What’s Behind The Promotion Of Recurring Payments