Third stimulus check: how much would covid-19 payment be?
President-elect Joe Biden has pledged to get qualifying Americans a third Economic Impact Payment as part of further coronavirus relief.
US President-elect Joe Biden is planning a major coronavirus relief package that would include a third stimulus check for qualifying Americans.
Biden: "We should be investing significant amounts of money"
Having previously referred to December’s $900bn aid bill as only a "down payment", Biden told reporters in his hometown of Wilmington, Delaware on Friday that he'll seek renewed relief "in the trillions of dollars" after taking office on 20 January.
“The price tag will be high,” Biden said, “but […] the overwhelming consensus among leading economists left, right and center is that in order to keep the economy from collapsing this year and getting much worse, we should be investing significant amounts of money right now to grow the economy.”
Biden’s remarks came as it was confirmed that the US had lost a whopping 140,000 jobs in December, signaling the reversal of an economic recovery that had seen employment levels in the country increase every month since April.
Third stimulus check: $1,400 or $2,000
As part of December's covid-19 relief bill, a second stimulus check of up to $600 is going out to people earning under $75,000 a year, with those on up to $87,000 receiving a gradually smaller figure and households also able to claim an extra $600 per dependent under 17.
On Friday, the IRS said it had distributed over 100 million checks by direct deposit, in addition to millions more by mail.
However, Biden is eager for people to get the larger maximum figure of $2,000 which, the week before last, Democratic lawmakers unsuccessfully sought to increase the latest round of payments to. "We need more direct relief flowing to families, small businesses, including finishing the job of getting people the $2,000 relief direct payment," he said. "$600 is simply not enough."
At the end of December, House Democrats passed legislation raising the second stimulus check to $2,000 - an amount proposed by President Donald Trump, who branded the $600 payment "ridiculously low" before finally signing off on it - but attempts to put the bill to a vote in the Senate were repeatedly blocked by its Republican majority leader, Mitch McConnell.
Now, though, the balance of power in the Senate has shifted, after Raphael Warnock and Jon Ossoff's victories in Tuesday’s run-off elections in Georgia saw the Democrats take control of the upper chamber.
It is not completely clear whether the Dems are likely to seek a third stimulus check for the complete $2,000 figure or for the $1,400 increase they voted for in the House, but Biden’s reference to "finishing the job" on getting a larger payment indicates it would be the latter.
Democrats have Senate advantage - but only just
It should be noted though, that the Democrats' slender advantage in the Senate - there is a 50-50 split in the chamber, with Vice-President-elect Kamala Harris given a tie-breaking vote - gives them no room for maneuver if there is opposition from any senators within the party.
This week, for example, Democratic Senator Joe Manchin told the Washington Post that he was "absolutely" against a third round of stimulus checks, saying the US’ priority should be vaccinating people against the coronavirus rather than sending out further direct payments.
He later toned down his remarks, saying he is in favor of another check - but only if eligibility is limited to those who are hardest-up. “If the next round of stimulus checks goes out they should be targeted to those who need it,” Manchin tweeted.
Next stimulus expected around March
Speaking to CBS, the financial analysts Ed Mills of Raymond James and Hunter Hammond of Heights Securities said Americans could expect a fresh round of stimulus to arrive in March, which is when the enhanced unemployment benefits included in December’s relief bill run out.
And recent analysis carried out by Earnin suggests another direct payment can’t come soon enough for Americans surviving pay check to pay check: on average, they will only be able to make their $600 check last for about three months and may spend it within six weeks, the company's CEO Ram Palanappian says.
"The $600 stimulus check will last for different amounts of time for different people. But for the people who are even more distressed financially, it’s going to be about one and a half months," Palanappian told CNBC.
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