Fourth stimulus check news summary, 22 December: COLA 2022 benefits, Medicare, Child Tax Credit...
- Omicron leads to business closures, some wonder if a fourth stimulus check will be passed to combat the economic losses
- US markets down on fears about Omicron and Build Back Better not passing
- Manchin walks away from Build Back Better negotiations
- Senator Manchin says he will not support the Build Back Better bill - what next for the Child Tax Credit?
- Senate goes on Christmas recess without Child Tax Credit extension - January payments will be delayed
- Double Child Tax Credit in February possible, says White House press sec Psaki
- Federal Reserve to reduce stimulus spending in coming months to combat inflation
Useful information & links
Child Tax Credit
-President Biden in fight to seal Child Tax Credit extension
-Final monthly Child Tax Credit payment of 2021 distributed on 15 December
- Could the Omicron variant lead to another federal stimulus check in the US?
-New parents could see another stimulus check reflected in their tax refund in 2022
- What's the deadline to get your stimulus check plus-up payment in 2021?
- How many Social Security payments are still to be sent out in 2021?
- When does COLA 2022 take effectin Social Security benefits?
- How much will the 5.9% COLA increase affect Social Security benefits?
Three stimulus checks have been approved by the US federal government during the coronavirus pandemic.
In cities like Austin and Chicago businesses are already shutting their doors voluntarily as Omicron infects staff and customers.
Empty Bottles in Chicago will be closed until 30 December, with one of the owners, Bruce Finklestone saying: “Our first goal is to look out for the health and welfare not only of our staff but our friends and our customers, and it just seemed to make sense.”
Without federal aid, many of these businesses may struggle to keep their doors open in the long term, as inflation continues to increase costs and workers in high supply.
Read more to see if this could prompt Congress to send another direct payment.
Real life encounter with inflation changed Fed official's opinion
Standing in line at a local store, President of the San Francisco Federal Reserve Mary C. Daly had to watch an uncomfortable scene play out. The elderly shopper in front of her at the checkout couldn't afford her regular purchases due to higher-than-normal prices.
The experience caused her to change her mind about when and how fast the Fed should raise interest rates to arrest inflation that many thought would be temporary and was considered tolerable for the economic recovery.
President Biden extends student loan moratorium
Tens of millions of American with student loans will be breathing a sigh of relief today. The Biden administration extended the student loan moratorium, that has frozen interest and payments on student loans for nearly two years, for an additional three months.
The moratorium was set to expire at the end of January next year. It will now continue until 1 May 2022. Democratic lawmakers are still pushing for President Biden to take executive action and cancel $50,000 of debt for student loan borrowers.
Five figure monthly medical bill spurs calls for Medicare for all
Even when you've done everything right an administrative snafu can leave you pulling your hair out. A Florida woman had the misfortune of dealing with a hospital bill that was over $550,000 even though she had insurance that should've covered the care for her child born prematurewhich at most should have resulted in $12,000 bill total.
Despite pointing out where the accounting error lay and a simple solution, it took reporters making inquiries to get the problem solved.
Despite stimulus relief for renters millions still behind on payments
Congress approved two rounds of rental aid for Americans struggling to pay their landlord. 80 percent of the first round has been handed out or is awaiting receipt by households in need but the distribution rates vary widely across the nation.
Nationawide there are 4.7 million households that are behind on there rent. In Georgia, where less than 20 percent of aid had gone out by October, over a quarter of low-income households are in arrears as of that month. After being in place for a year, the federal moratorium on evictions expired in August.
The US economy has been running hotter than experts and officials had forecasted which has led the Federal Reserve to decide it will gradually end the pandemic stimulus program put in place nearly two years ago.
That program kept interest rates low to promote more liquidity in the market and stimulate the economic recovery from the covid-19 crisis. The central bank has also been buying Treasury bonds and mortgage-backed securities to inject large sums of cash into the US economy.
Potential workaround on passing the Child Tax Credit
The White House is optimistic about moving forward on President Biden's Build Back Better plan after Senator Joe Manchin put the kibosh on it Sunday. That signalled the end to changes that enhanced the Child Tax Credit, including the monthly payments that have cut childhood poverty by over 40 percent this year.
However their may be another way to extending those advance payments. Senator Mitt Romney proposed a similar policy earlier this year, however it used the Social Secuirty Administration to issue the payments instead of the IRS. On Monday he signalled that he would be open to working with the White House to move forward with enhancing the Child Tax Credit.
Americans taking advantage of lower rates in Healthcare.gov exchange
Open enrollment for Obamacare for 2022 began on 1 November. According to CMS, Americans in the 33 states using federally-run exchanges through HealthCare.gov have been signing up in record numbers. Nearly a million more people had already signed by 15 December 2021 than the previous all-the-high in 2018, for a record 13.9 million.
In those states, 92 percent of people will receive premium tax credits accoding to CMS, and Health and Human Services Secretary Xavier Becerra said nine out of 10 consumers have plans for less than $10 a month.
Although people needed to sign up by 15 December for coverage to start by 1 January there is still time to enroll. The last day to enroll in or change plans for 2022 coverage is 15 January 2022, except for those that qualify for a Special Enrollment Period. For those that enroll between now and 15 January their coverage will begin 1 February 2022. More information is available at Healthcare.gov.
The Internal Revenue Service (IRS) began sending around 169 million Americans a third Economic Impact Payment (EIP), or stimulus check, after Democrats passed the American Rescue Plan in March 2021. That direct payment to taxpayers was for up to $1,400 for every eligible man, woman and child, to boost household finances in light of the continuing covid-19 pandemic, but not all of those who were eligible received a payment.
The IRS automatically sent out payments based on the information they received from taxpayers, either through an online portal for Non-Fliers or from 2019 or 2020 tax returns. Anyone who the tax agency was unaware of would not have received a payment, but when the 2022 tax season rolls around that oversight can be remedied.
Graph shows Child Tax Credit spending
As mentioned earlier, Bloomberg has published data pertaining to the spending of the Child Tax Credit.
The organization has published a graph of the spending, with the vast majority being spent on the essentials of food and utilities.
WATCH: Can the president unilatterally extend the Child Tax Credit?
With the extension to the Child Tax Credit currently looking dead in the water, the Democrats are looking for alternative ways to pass their plans to the president's desk.
An alternative is Joe Biden signing an executive order, but the legality is unsure of such a move. Biden has so far been cautious to use his presidential powers.
More than 169 million payments have been sent out in the third round of stimulus checks, but groups are continuing to push for a fourth as inflation continues to bite, as well as the dominance of a new covid-19 variant, Omicron, that is scaring markets and creating a burgeoning new wave of illness.
In New York, new covid-19 cases rose 60% in the week that ended on Sunday as the Omicron variant spreads rapidly around the US northeast. New York has set records for the most new cases reported in a single day since the pandemic started for three consecutive days. This has given a boost to the prospect of further stimulus checks as the risk of great economic trouble lies ahead.
What was the Child Tax Credit spent on?
Overwhelmingly, people who have received the child tax credit payments have used it for food, rent, and utilities and to pay off debt, data from the US Census Bureau has found.
So far, the majority of households making less than $50,000 per year are putting the payments toward debt, an August survey by the US Census Bureau found. Higher income families were more likely to be saving the money.
Could student loan repayments be delayed?
During a Tuesday briefing at the White House, Jen Psaki told reporters Biden has not yet decided whether he will allow millions of Americans to forgo student loan payments at no additional cost beyond January 31.
Biden in August extended an order initially issued by former President Trump in March 2020 to pause due payments and interest on federally held student loans through the end of next month. The administration said it would likely be the last extension of the order, and Psaki all but ruled out another extension in a press conference two weeks ago.
For those fed up with the grind of the nine-to-five and nearing retirement age, it might be tempting to take advantage of the fund they’ve built up through Social Security at the first possible opportunity. However, retiring before full retirement age will result in lower monthly payments than you would otherwise receive.
To help Americans plan for when the best time for them to retire is, the Social Security Administration provides an early retirement penalty chart. That way you can calculate whether or not it is worth giving up your regular paycheck and live off your retirement account and savings.
Manchin priorities: Child Tax Credit or donors?
'As hard as it is to believe, Democratic Sen. Joe Manchin III reportedly blew up negotiations for the Build Back Better bill not over provisions to address climate change or tax proposals affecting wealthy Americans, but over the child tax credit that has lifted millions of children out of poverty.
'That makes even less sense considering Manchin’s home state of West Virginia is among the poorest states in the country.'
Jennifer Rubin gives her view for the Post.
CBS takes a look at shifts in the labor market
The job market is shifting. The number of unemployed people currently looking for a job was neared pre-pandemic levels, yet businesses are still struggling to staff up-- more than 11 million jobs remain open. Additionally, with the labor market on the side of workers, many have quit in record numbers in looking for higher pay and greater flexibility. CBS took a greater look at these forces.
On Sunday, the White House released a heated and personal statement detailing their frustration that Senator Joe Manchin walked away from the negotiation table. Senator Manchin and President Biden had been discussing the President’s Build Back Better bill, which was passed by the House of Representatives earlier this month. Progressives have tied the fates of the bipartisan infrastructure bill, which focused on investments in traditional infrastructure, to the Build Back Better bill.
Early last week, Sen. Manchin provided the White House with “a written outline for a Build Back Better bill that was the same size and scope as the President’s framework, and covered many of the same priorities.” The Administration believed that this could represent a starting point for further discussions but instead, Manchin has made public comments that he will not be seeking to negotiate any further.
Manchin released a statement saying that he cannot explain the bill to his constituents, and after trying to negotiate a bill he felt comfortable with he felt that he had to walk away.
Biden sees hope where many see despair
During President Biden's address to the nation on the Omicron variant, he took a few questions from the press. A few reporters asked if he felt that the negotiations with Senator Joe Manchin were truly over, and the President offered an optimistic perspective that a compromise could still be reached with the Senator from West Virginia.
Schumer pushes for January vote
During the Senate Democrats caucus meeting, Senate Majority Leader Chuck Schumer pushed to hold a vote in January on Build Back Better to create pressure for a deal.
“I know we are all frustrated at this outcome,” Schumer told his members, using the party's initialism for the bill known as Build Back Better.
“However, we are not giving up on BBB. Period. We won’t stop working on it until we pass a bill,” according to a Democratic source on the call
“In the New Year, we will have a vote on the Motion to Proceed to the House-passed bill,” and he added he plans to make the Senate substitute amendment the current Senate text as published.
Good morning and welcome to AS USA’s daily live blog for Wednesday 22 December 2021, in which we’ll be bringing you the latest news on President Biden's Build Back Better bill, and the attempts to extend the enhanced monthly Child Tax Credit payments as part of the proposed legislation.
We'll also provide you with updates on a potential fourth federal stimulus check in the US, as well as information on unemployment and Social Security benefits.