Fourth US stimulus check summary: 14 September 2021
Stimulus checks and Child Tax Credit latest news
- Stocks rise on lower-than-expected consumer inflation data
- Fourth federal stimulus check not in $3.5tn reconciliation bill (Full story)
- Some US states sending out their own stimulus payments (More info)
- Overview of the three stimulus checks passed by Congress. (Details)
- Will the Child Tax Credit be extended to 2025? (Full story)
- Conservative Dems oppose extension of new Child Tax Credit (Full details)
- Many jobless Americans seek out other federal aid available to the unemployed (Full story)
Useful information / links
California Golden State Stimulus checks:
- When can I expect my $600 Golden State Stimulus in California will arrive? (Details)
- What state programs exist for Americans who have lost unemployment benefits? (Full details)
- IRS to distribute third Child Tax Credit payment on Wednesday (Find out how you can opt out of monthly CTC)
Some of our related news articles:
Poverty fell in 2020 thanks to stimulus checks and financial relief
A new study from the US Census Bureau has found that poverty in the United States actually fell in 2020, despite the huge economic repurcussions of the covid-19 pandemic. It is thought that the huge amounts of federal stimulus injected into the economy was responsible for the incredible rise, with programmes like the stimulus checks and additional unemployment benefits believed to be responsible.
Stimulus checks: every AS article on direct payments
In our dedicated stimulus checks news section, you’ll find a host of articles offering updates on a potential fourth direct payment, in addition to information on other, similar relief measures such as the Golden State Stimulus checks in California.
Although a fourth stimulus check doesn’t look likely in September, some states will be sending certain residents a little extra money this month.
Three stimulus checks have been sent out so far by the US federal government since the coronavirus pandemic began in early 2020.
Child Tax Credit round three coming Wednesday
Each child under six at the end of the year could be eligible for up to $3,600, and those six through 17 at the end of 2021 could be eligible for up to $3,000.
To find out if your family is eligible, use this link to access the IRS portal.
60 percent support push for vaccine mandates
According to an Axios-Ipsos poll from Tuesday, The survey, conducted Sept. 10-13, found that 60 percent supported the federal government requiring all federal employees to be vaccinated against covid-19, while 39 percent oppose the requirement.
The president unveiled the mandates last week as part of his strategy to get more people vaccinated who have not yet received one dose.
Biden rallies Democrats with tax proposals
President Biden has reiterated his support for increasing taxes on the wealthy as the Democrats try to steer their $5 trillion policies through the Capitol. They need the support of all 50 Democrats in Congress, but the votes of Senators Joe Manchin and Kristen Sinema are not assured, as both want the bills to be reduced in size.
Manchin in particular is cautious of such large spending and wants it to be affordable in his eyes. Biden's plan is to increase taxes for the richest strata of society, and keep taxes low for the middle class.
Data shows which support helped the most people stave off poverty in 2020
Far and away the greatest factor keeping people out of poverty was the three stimulus checks sent out during both Trump and Biden's presidencies. Nearly 12 million people were helped by this support, a group of unprecedented payments to Americans throughout the pandemic.
To a smaller, but no less important, proportion, unemployment insurance and tax credits also protected nearly 11 million people.
In total, the extra pandemic support helped 27.7 million people across the US.
What does the fall in poverty tell us about the link between employment and poverty?
As has been reported today, the US poverty rate reduced during 2020. This was despite the global pandemic and historic job losses. However, this information could give good pointers into how employment doesn't equal a reduction of poverty, especially in an era of high living costs and people holding multiple jobs.
It shouldn't be a surprise that giving money to the needy prevents poverty. Not "absolutely incredible" as Jeff Stein puts it. But with pandemic support receding, the chances of an increase in poverty are raised. Will these lessons be learned from the pandemic how to keep people out of poverty?
Even if governments are criticized for high inflation or for racking up public debt, the hard fact is the pandemic support has saved millions of Americans lives from poverty in 2020.
How many jobs are available in the United States?
In July, the number of job openings broke records by reaching almost 11 million. After the pandemic led to a massive wave of layoffs, businesses are beginning to hire.
With federal unemployment benefits having ended in early September, many wonder if more people will choose to make their reentry into the labor market. However, with slow job growth reported in August, many wonder if the pandemic continues to be a barrier in decreasing unemployment.
Where is the second $600 Golden State stimulus check? How can I track its status?
Golden State stimulus checks worth $600 begin to hit bank accounts after being signed into law by Gov. Newsom on 13 July.
Here is how to track the payment and contact the California Franchise Tax Board with questions.
New from US Census Bureau on poverty rates
The US Census Bureau is now reporting that if the federal government had not established programs to expand unemployment insurance, 4.74 million more people could have fallen into poverty.
The new data shows that those with a high school degree, not no college would have been impacted the most. Federal benefit programs helped to prevent almost a million from falling into poverty. With the benefits in place, the poverty rate for this group actually decreased by 1.5%.
Red more here.
How many unemployment claims were made last year?
A CBS affiliate is now reporting that on average, state unemployment offices paid an 20 million claims each week.
The same reporting showed that poverty in the US increased by 1 percentage point to 11.4%.
California began sending out a second round of Golden State Stimulus checks 27 August. Californians must file a 2020 tax return, there is still time.
Graphic of who is most likely to miss out on Child Tax Credit
The Tax Policy Center provides a graphic of which parts of the US are most likely not to get the advance payments from the 2021 Child Tax Credit because families didn’t file a tax return in the past two years. Many of these families are not required to file taxes because they earn too little, exactly who the enhanced tax provision is designed to help the most. As many as 2.3 million children might miss out on the benefits of the program.
2020 saw poverty reduced through covid-19 stimulus measures
The supplemental poverty measure (SPM) in 2020 was lower in 2020 2.6 percent lower than in 2019. For the first time ever in the history of using the SPM it was lower than the official poverty rate which was one percent higher in 2020 at 11.4 percent.
The SPM extends the official poverty rate to include noncash benefits, stimulus checks, taxes and other necessary expenses.
The main driver of this difference in the SPM is the inclusion of stimulus payments in 2020. Without the stimulus payments, the overall SPM rate would have been 12.7 percent compared to 9.1 percent. The first two rounds of stimulus payments, enacted as part of covid-19 economic relief legislation, moved 11.7 million people out of poverty.
Bernie Sanders on “I’ve already compromised”
The Democrats’ spending proposal that is supposed to compliment the bipartisan infrastructure bill looks to be on the ropes with Senator Joe Manchin saying he won’t vote for it as is. He wants the spending to be cut by over two thirds which has drawn the ire from many of his fellow Democrats.
When asked whether he would compromise to get Sen. Manchin on board, Senator Bernie Sanders replied “I have compromised... I brought forth a budget for $6 trillion.” The current proposal is $3.5 trillion. Sen. Sanders however does think that the party will work out a spending package that all Democrats can get behind. “We’re working 24/7 to resolve everyone’s problems.”
The California Comeback Plan, which approved a new round of stimulus checks for more residents, will also see some Californians getting a second payment.
Inflation data in, market react positively
The government released highly anticipated key inflation data before the opening bell on Wall Street. Consumer prices rose by 0.3 percent in August, the lowest rate in seven months. August consumer prices rose 5.3% from a year ago. This came as good news after last week's wholesale prices rose by a record-breaking 8.3 percent.
The new inflation numbers will now be used by the Fed when they meet next week to judge whether higher inflation is temporary or here to stay. This will be key in the central bankers’ determination of when they might start tapering their stimulus program.
The lower-than-expected inflation data caused US stock futures to shoot higher and turn positive.
$3.5tr spending package economic and national security benefits
EPA Administrator Michael Regan argues that through the Democrats’ $3.5 trillion spending proposal will make the US more competitive and save the nation money down the road. By making US infrastructure more resilient to the effects of climate change now the nation will be saving itself more costly expenses in the future.
AOC attends Met Gala with a message, “Tax the Rich”
Congresswoman Alexandria Ocasio-Cortez made her debut at the 2021 Met Gala on Monday evening wearing a statement. On the back of her white dress was the message “Tax the Rich” in bold red letters. She said that the statement was to “bring all classes into the conversation,” about a fair tax code. The Met Gala is attended by many of Hollywood's biggest and wealthiest stars.
Child Tax Credit extension at risk
The enhanced Child Tax Credit has already made its mark on childhood poverty, lifting three million children out of poverty in its first month alone. If the policy were to continue it would improve those kids educational, health and economic outcomes throughout their lives. The changes to the tax provision will expire at the end of the year without congressional action.
The cost of the program, and other measures Democrats want to include in their $3.5 trillion spending package over the next ten years, has Senator Joe Manchin calling for a pause on the whole venture. He would like to see the total cost of the proposals dropped to $1 trillion to $1.5 trillion.
Progressives are saying that is a step too far, that they already came down from their original $6 trillion in spending and any further watering down of the plan would harm the efficacy of the proposals, many of which are laid out in President Biden’s Build Back Better plan.
Without Senator Manchin’s vote, the spending proposal, including a proposed extension of the Child Tax Credit until 2025, would be doomed in the Senate where Democrats need all 50 votes in their caucus.
Simplified mobile app to claim 2021 Child Tax Credit
The third of six installments on the 2021 Child Tax Credit will be sent tomorrow. The IRS announced last month that people that aren’t required to file taxes could now use a new mobile app GetCTC to enroll in the monthly advance payments scheme as part of the enhanced Child Tax Credit.
Investors steeling themselves for inflation data
The US dollar held firm slightly below a two and a half week high hit yesterday. Investors are steeling themselves for data on inflation that will indicate timing of policy tightening by the Federal Reserve set to meet next week.
Economist expect core consumer price inflation (CPI), an index minus volatile energy and food prices, to have risen 0.3% in August from July. The data will be released at 7:30 ET.
'A strong release will likely further dampen the mood, as the bad news on (the) inflation front won’t boost the Federal Reserve's doves, as high inflation is the major reason why the Fed can’t keep doing what it does: throwing cheap liquidity into the market,' said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Photo by Brendan McDermid, Reuters
Delta variant dampens economic recovery
In the covid-19 economy uncertainty about what the future holds has become common. When vaccination campaigns finally got up to speed in the spring and summer across the developed world, businesses reopened and people were getting back to work. Economies made great strides towards recovering lost ground on the back of vaccines and stimulus.
But with the onset of the Delta variant, all that has been put at risk again as hospitals fill up and new bottlenecks in the supply chain are created. Another recession isn’t expected but expectations of gangbuster growth for economies around the world has been dampened. Neil Shearing at Capital Economics has cut his quarterly growth forecast in half for advanced economies.
Rhode Islanders who refuse vaccine to be ineligible for benefits
Some may have medical or religious reasons not to get a vaccine, and those situations will have to be carefully scrutinized, Matt Weldon, the director of the Rhode Island Department of Labor and Training, said. As a general rule, however, the state considers covid-19 vaccine mandates to be a reasonable requirement that employees have to follow. If they won’t, and they lose their jobs because of it, they won’t be able to get unemployment benefits.
If workers at those facilities aren’t vaccinated by October 1, they won’t be allowed in the building. The state has a medical exemption for health care workers, a provider needs to sign off on it, but no religious one.
How will the Democrats pay for the reconciliation bill?
With a bumper month in Congress to sort the infrastructure and reconciliation bills, much of the discussion has turned to how the Democrats plan to fund their trillion dollar agenda.
Progressives have been upset at the apparent watering-down of proposed tax hikes on the wealthy. The Ways and Means Committee would raise the corporate tax rate for income above $5 million from 21% to 26.5%, while Biden had called for a 28% corporate tax rate.
It remains to be seen how the tax proposals change as the spending package moves through Congress. Nearly every House Democrat, and every Senate Democrat, will need to vote for the spending bill for it to pass, meaning small groups of lawmakers have the ability to influence the legislation.
The next Child Tax Credit payment is due to be sent on September 15, a mere two days away. After this payment, there are still three more due before the end of 2021.
The last six months will be all grouped together and received at the end of the tax year in 2022.
On paper, the poor August jobs report does not make sense considering the millions of jobs available, but the answers point to varied reasons.
Poor jobs report disproportionately affecting black workers
Despite the unemployment rate falling from 5.4% to 5.2%, with white workers having an overall rate of 4.5%, black workers actually lost more jobs than their white and latino counterparts.
According to CNBC, black unemployment rose to 8.8% from 8.2% in July.
Tax plan released on Monday gives pointers to Democrat legislative plans
To pay for the large spending bill and tax cuts, the plan includes tax increases for the wealthy and some businesses.
The House plan raises the top marginal tax rate to 39.6 percent for individuals making more than $400,000 and for couples earning more than $450,000 per year.
The proposal implements a new system for business taxes. Rather than a 21 percent flat corporate rate, corporations would pay 18 percent on the first $400,000 of taxable income, then 21 percent on income up to $5 million, and 26.5 percent on income above that.
It also includes plans to continue the Child Tax Credit through to 2025.
Democrats hit out at Manchin's Child Tax Credit attacks
The chair of the Progressive Caucus in the Democrat has come out against Senator Joe Manchin, who is part of the Democrat right, which is seeking to disrupt President Biden's agenda.
Manchin has taken a fresh shot against the Child Tax Credit, arguing there should be limits on who can receive it. In the last week, Manchin has also argued the $3.5 trillion reconciliation package should be reduced to $1.5 trillion.
However, Rep. Pramila Jayapal said that children deserve to eat regardless of their parents' situation. The CTC has already proven to reduce child poverty, even though it has only had two payments so far. Four more are due this year, with the next on September 15.
New details have begun to emerge over the measures included in the $3.5 trillion reconciliation bill. One item missing -- a new round of stimulus checks.
Sanders sits down with George Stephanopoulos to discuss the reconciliation bill
In the interview the Vermont Senator responded to comments made by Senator Joe Manchin who said that the more progressive wing of the party should not "hold the bipartisan infrastructure package hostage" with the reconciliation bill.
Senator Sanders began by stating that it was his belief that Manchin was holding the trillion dollar reconciliation bill hostage by withholding his support.
The Speaker of the House and the President are in favor of both bills. While Sen. Sanders understands the need to invest in physical infrastructure, he also spoke to the struggles of the working and middle classes in the US.
Enhanced federal unemployment benefits ended for millions of Americans jobless due to the pandemic, but there are still some who can claim additional aid.
Why does Senator Joe Manchin believe a strategic pause should be taken in passing the $3.5 trillion reconciliation bill?
West Virginia Senator Joe Manchin stopped by Meet the Press Sunday to discuss his opposition to the $3.5 trillion reconciliation bill.
Earlier this month, Manchin wrote an op-ed in The Wall Street Journal encouraging his Democratic colleagues to take a "strategic pause," before passing the reconciliation bill.
Manchin's vote would is needed for the legislation to pass as no Republicans. Speaker of the House Nancy Pelosi has publicly stated her disagreement with Manchin, asking him in an news conference which of the popular measures he would like to cut.
Manchin calls the measures included in the bill "social reforms," and said he would not support a $3.5 trillion bill. He has also said there is "urgency" in passing the legislation. However, many Democrats disagree especially as new reports show that many US households find themselves in a precarious economic situation as the federal eviction moratorium has been lifted and millions have lost their unemployment benefits.
Stimulus checks and Child Tax Credit live updates: welcome
Hello and welcome to our live blog on Tuesday 14 September 2021, offering you the latest updates on a possible fourth stimulus check, plus information on the enhanced Child Tax Credit.
We'll also provide you with news on other relief measures in the US, such as unemployment benefits and California's Golden State Stimulus checks scheme.