Democratic leaders in the United States Senate have asked President Joe Biden to include recurring stimulus payments in his next COVID-19 economic recovery package, which is widely anticipated to be primarily focused on infrastructure spending.
The request is not tied to the American Rescue Plan – the legislation that was passed by the House of Representatives last week – currently under debate in the Senate.
In a letter to the White House obtained by Business Insider on Tuesday, Senate Finance Committee Chairman Ron Wyden (OR), Senate Banking Committee Chairman Sherrod Brown (OH), Senate Budget Committee Chairman Bernie Sanders (I-VT), along with Senators Cory Booker (NJ), Kirsten Gillibrand (NY), Michael Bennet (CO), Tammy Baldwin (WI), Alex Padilla (CA), and Senators Elizabeth Warren and Ed Markey of Massachusetts – pressed the president “to include recurring direct payments and automatic unemployment insurance extensions tied to economic conditions in your Build Back Better long-term economic plan. This crisis is far from over, and families deserve certainty that they can put food on the table and keep a roof over their heads. Families should not be at the mercy of constantly-shifting legislative timelines and ad hoc solutions.”
There are several reasons to prioritize both recurring payments and enhanced unemployment insurance. First, these two forms of payments are effective together. Unemployment insurance has replaced lost income for millions who have lost their jobs. But millions of others do not qualify for unemployment insurance after seeing their hours reduced, switching to lower-paying jobs, or temporarily leaving the workforce to care for family members during the pandemic. Direct payments are crucial for supporting struggling families who aren’t reached by unemployment insurance. An Urban Institute study suggests that a single direct payment of $1,200 combined with an extension of enhanced unemployment insurance and other assistance could keep 12 million people out of poverty, and adding a second direct payment could keep an additional 6.3 million people above the poverty line.
Second, data shows that direct payments and enhanced unemployment insurance are among the most effective forms of relief available. Not only do these payments help keep families out of poverty, but they act as economic stimulus by increasing spending and supporting jobs. When the CARES Act relief checks ran out, poverty rose, and many families saw spiraling debt. Automatic stabilizers will give families certainty that more relief is coming, allowing them to make the best decisions about how to spend their relief payments as they receive them. Families shouldn’t have to worry about whether they’ll have enough money to pay for essentials in the months ahead as the country continues to fight a global pandemic. Almost six in ten people say the $1,400 payments set to be included in the rescue package will last them less than three months.
Third, recurring direct payments have wide support from both the general public and economic experts. Polling shows 65 percent of Americans support recurring cash payments ‘for the duration of the pandemic.’ This includes support from 54 percent of Republicans and 60 percent of independents. Economists support the idea too. More than 150 economists recently wrote an open letter supporting automatic stabilizers as part of a strong recovery and warning against repeating the mistakes of the Great Recession, when an insufficient response led to unnecessary suffering, particularly among low-income workers.
As you have said, now is the time for boldness. As you prepare your Build Back Better plan for long-term economic recovery, know that we are ready to work with you in support of recurring direct checks and extended unemployment insurance benefits to support Americans who are still struggling during the pandemic.
What's Your Reaction?
Brandon is a political writer for the Hill Reporter specializing in current events, breaking news, and scientific discovery. Brandon holds a Bachelor of Music degree from Indiana University. He lives in New York City.