Most Americans burned through their stimulus money in less than four weeks. However, the perceived jewel of the CARES Act was the $300 billion directed at stimulus payouts to the American public and seniors.
Knowing full well the sort of tumult that the shutdown of nonessential businesses would create, lawmakers on Capitol Hill passed and President Trump signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act on March 27. The CARES Act wound up providing $500 billion to distressed industries, such as the airlines, set aside close to $350 billion for small business loans, supplied $100 billion to hospitals, and offered $260 billion to expand unemployment benefits through the end of July. This $260 billion is responsible for bumping up unemployment benefits by $600 a week for up to four months.
More than 150 million Americans have qualified for an Economic Impact Payment, as these stimulus payouts are officially known, with maximum disbursements of $1,200 per individual or $2,400 per married couple filing jointly. Qualifying dependent children under the age of 17 can also add $500 per child to what a parent or household will receive. At last check, the Internal Revenue Service had divvied out almost $218 billion to nearly 130 million Americans.
While the stimulus money provided by the CARES Act was very much needed, it, in many instances, isn’t doing nearly enough for most taxpayers or their families. A Money/Morning Consult survey of 2,200 people in late April showed that 46% had completely spent their Economic Impact Payment in two weeks, with 74% going through their payout in four weeks or less.
With the economy unlikely to snap back to where it was at the beginning of the year overnight, once businesses do fully reopen, additional stimulus measures almost certainly seem necessary.
The big question is, what should those additional stimulus measures look like?
On Tuesday, the Democratic-led House of Representatives unveiled what they believe to be the answer.
The 1,815-page Health and Economic Recovery Omnibus Emergency Solutions Act, or HEROES Act, would come with a cost of around $3 trillion, surpassing the CARES Act, and direct money to a number of areas, including another round of direct stimulus payments to Americans and their families. While not a complete list, here’s where some of this $3 trillion would be directed:
- $1 trillion would be provided to state, local, territorial, and tribal governments that need the funds to pay first-line responders and teachers.
- $200 billion would be set aside to establish the Heroes’ Fund as a way of providing hazard pay to essential workers during the pandemic.
- $75 billion is provided for additional COVID-19 testing supplies and contact tracing measures.
- Extends unemployment benefit protections — i.e., the extra $600 per week — through January 2021.
- Allots $175 billion to aid families struggling to make their rent, mortgage, or utility payments.
But the eye-catcher of this $3 trillion proposal is the second round of stimulus payments.