CORONAVIRUS

Biden announces the American Rescue Plan, worth more than $1.9 trillion

President-elect Joe Biden has announced a new covid-19 economic relief bill, which includes $1,400 stimulus checks, additional unemployment benefits and a billions to speed up vaccine roll-out.

Biden announces the American Rescue Plan, worth more than $1.9 trillion
ALEX WONG AFP

On Thursday evening President-elect Joe Biden gave a speech from Wilmington, Delaware in which he outlined his proposal for the largest covid-19 economic relief bill since the CARES Act was signed last March. The package, called the American Rescue Plan, is designed to address the immediate dangers of the pandemic and provide direct assistance to those in need of economic support.

“During this pandemic, millions of Americans, through no fault of their own, have lost the dignity and respect that comes with a job and a paycheck,” said Biden, in what could be considered the first policy speech of his presidency. “There is real pain overwhelming the real economy.”

New round of stimulus checks included in the American Rescue Plan

Biden’s remarks on Thursday made clear that he is looking to provide direct support to Americans who have been hit hardest by the economic fall out of the pandemic. During negotiations for the covid-19 relief package that was passed in December Biden repeatedly voiced his support for another round of stimulus checks worth $2,000. Instead only $600 were provided at that time.

But having gained control of the Senate in the Georgia runoff races the Democrats are now able to pass much of Biden’s agenda and an additional round of $1,400 is included in the new package. Biden said that this will “finish the job”, bumping up the previous round of payments to provide the full $2,000.

However not all were happy with this two-part approach and argued that given how long Americans waited for the support, an additional $2,000 (on top of the recent $600) would have been preferable. Progressive Congresswoman Alexandria Ocasio Cortez was one who felt Biden should have gone further, telling The Washington Post that the $1,400 was not enough.

Unemployment benefits boosted and a new federal minimum wage

The American jobs market is currently experiencing one of the bleakest crises of a generation and looks set to worsen as covid-19 case numbers continue to rise. On Thursday the Labor Department announced that 1.15 million Americans had filed new unemployment claims during the first full week of 2021. This represents a 25% increase on the previous week and comes as the department reported that 140,000 jobs were lost nationwide in December.

This marked increase in unemployment came at a time when federal unemployment benefits were running out, as they were set to expire on 26 December. A stopgap bill provided additional bill until March, but the American Rescue Plan provides funding to offer unemployed Americans an extra $400 weekly supplement until September 2021. Biden’s proposal would also see the eviction and foreclosure moratoriums extended until the end of September, to protect those experiencing financial hardship.

During his speech Biden spoke of a “growing divide between those few people at the very top who are doing quite well in this economy — and the rest of America.” In an attempt to counter that trend he is calling on Congress to raise the federal minimum wage to $15 per hour. The current national minimum wage is just $7.25 per hour, and has not been raised since 2009.

American Rescue Plan to provide billions for covid-19 fight

Of the $1.9 trillion of federal funding pledged in this new relief bill, $90 billion is specifically aimed at tackling the medical side of the pandemic. The new package commits $50 billion towards improving the nationwide testing system, while $20 billion will be put towards a national vaccine programme to be ran in partnership with states, localities and tribes.

 

Alongside that support is an additional $350 billion in state and local government aid, some of which will also go towards the vaccination effort to quicken the pace to achieving some level of herd immunity. There is also $170 billion for K-12 schools and institutions of higher learning and tweaks to Child Tax Credit to make it fully refundable and to increase the amount offered to $3,000 per child ($3,600 for children under the age of six).

“I know what I just described does not come cheaply, but failure to do so will cost us dearly,” said Biden on Thursday, acknowledging the high cost of his plan. “The consensus among leading economists is, we simply cannot afford not to do what I’m proposing.”