by Christy Bieber | Jan. 29, 2021
Many economists believe lawmakers need to go big on the next coronavirus stimulus bill.
Lawmakers in Washington, D.C. are once again negotiating a new coronavirus relief bill. As Democrats push for swift action and Republicans question spending more on coronavirus aid so soon after passage of a $908 billion stimulus bill, more than 120 economists are calling on Congress to pass "sweeping" additional aid, including a third stimulus check and more help for the jobless.
In an open letter, more than 120 economists -- including the National Economic Council Director from the Clinton and Obama Administrations and noted academics from the Brookings Institute, Columbia University, and numerous other universities and nonprofits -- expressed belief that "it's critical for Congress to immediately pass a new coronavirus relief package that will provide additional assistance to families and businesses struggling through a hard winter, and to provide the economic boost required to promote growth and prosperity."
Specifically, this group of experts calls for "substantial unemployment benefits and stimulus checks," along with more relief for renters and homeowners, as well as aid to states coping with COVID-19 costs.
Their letter makes clear they believe the financial assistance offered by current legislation is insufficient given the enormity of the economic and public health crises Americans face, and that the small scope of past relief "blunted the impact" of legislation. The economists draw parallels between the current situation and the financial crisis in 2008, which they believe was prolonged due to inadequate government response.
Although the letter does not explicitly spell out what they believe would be sufficient stimulus money or jobless benefits, the group endorses the plan put forth by President Joe Biden, indicating that the administration's "robust rescue package" constitutes the type of relief they believe is necessary.
Biden's proposed $1.9 trillion plan is smaller in scope than the CARES Act, passed in March 2020 at a price of around $2.2 trillion. But it's nearly double the size of the $908 billion relief package Congress signed into law at the end of December.
Biden's plan provides $1,400 stimulus checks for most Americans (on top of the $600 the last bill authorized), as well as $400 in extra weekly unemployment benefits through September (the last bill provided just $300 more per week through mid-March). It also offers $350 billion in financial assistance to state and local governments left out of the last relief bill.
Republicans have objected to the total cost of the bill as well as specific provisions, including increasing the federal minimum wage to $15 per hour. And moderates from both sides of the aisle have suggested that the extra $1,400 in stimulus money should be targeted to ensure it goes only to those in need.
The economists who signed the letter believe those who think the country shouldn't spend more on relief are "simply wrong," and that "history shows what our nation cannot afford is inaction or timidity in the face of what many consider to be the greatest economic disaster since the Great Depression."
Those with cost concerns are likely to get sidelined, as Democrats are eager to pass a bill as soon as next week, even if it must be a partisan effort. If the Democrats can hold their caucus together and get 51 votes for Biden's stimulus bill, Americans will soon see more money in their bank accounts, just as these economic experts have called for.
If you have credit card debt, transferring it to this top balance transfer card can allow you to pay 0% interest for a whopping 18 months! That’s one reason our experts rate this card as a top pick to help get control of your debt. It’ll allow you to pay 0% interest on both balance transfers and new purchases until 2022, and you’ll pay no annual fee. Read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
Copyright © 2018 - 2021 The Ascent. All rights reserved.