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by Dana George | Published on Nov. 29, 2021
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While some escaped the pandemic financially unscathed, others have not been so fortunate.
While the dream of additional stimulus checks has been declared dead by many, there are legitimate reasons some lawmakers continue to call for more federal aid. Here, we'll outline the most pressing reasons Congress may want to consider recurring stimulus payments until the pandemic is officially behind us.
Venture into the heart of any midwestern city. Chances are, there will be nary a mask in sight, as though coronavirus concerns are a thing of the past. And yet, last week alone, more than 2,200 people in Missouri died of COVID. In fact, there were COVID-related deaths reported in 49 of the 50 states during the same seven-day period. These were parents providing for families, business owners leaving behind companies, and everyday families now faced with sky-high medical bills.
In addition to COVID-19, we're now dealing with the delta variant, and potentially, the newly identified omicron strain coming out of Africa. No matter which variant hits a community, COVID continues to kill, and those fortunate enough to survive could face long-term symptoms that prevent them from working.
Due to the spread of the delta variant alone, Oxford Economics cut its 2021 global economic growth forecast from 6.4% down to 5.9%. In other words, the economy is not rebounding as quickly as expected.
In order to deny the need for more stimulus funds, Congress must deny the fact that COVID continues to alter the financial landscape.
The seasonally-adjusted national employment rate for October was 4.6%, definitely down from this time last year (when it was 6.9%). However, it's still higher than the pre-pandemic level of 3.5%. And though many businesses are hiring, there are still millions less on payrolls today than before the pandemic.
There is no simple explanation for why more people aren't back to work, or why those who did go back are now leaving their jobs in record numbers. For some, it's a matter of not wanting to be exposed to a life-threatening virus while on the job. For others, the pandemic represented a time of reflection, and they've decided not to go back to their pre-pandemic life. They're starting businesses, going back to school, and finding other ways to get by. And some have lost their jobs as companies tighten their belts in hopes of squeezing a profit from the employees left behind.
Interesting aside: Republican-controlled states claimed that overly generous unemployment benefits were to blame for the high unemployment rate. These states ended their participation in the Federal Pandemic Unemployment Compensation (FPUC) program, confident that taking away the extra $300 in weekly benefits provided by FPUC would do the trick. What actually happened was far more fascinating.
Between April and July, those states that cut FPUC enjoyed an overall job growth rate of 0.9% -- which was good news to them. However, the states that left FPUC in place experienced a higher job growth rate of 1.6%. While the states without FPUC saw their unemployment rates decline by 0.2%, states that kept the boosted payments in place experienced an unemployment decline of 0.4%.
In order to deny the need for more stimulus checks, Congress must deny the fact that millions of Americans are still out of work.
Some Americans used a portion of their stimulus checks to pay down debt, and some paid basic expenses and banked the rest. The ability to put anything away in savings -- no matter how small -- is important, particularly when you consider that in 2019, 41% of households between the ages of 25 and 64 said they did not have enough put away to pay an unexpected $400 expense. Giving someone enough to pay an expected expense eliminates their need to borrow the money at a high interest rate.
More importantly, the first two stimulus payments alone helped lift 11.7 million people out of poverty, according to the U.S. Census Bureau. This includes 3.2 million children under 18, 6.4 million adults between 18 and 64, and 2.1 million people over 65. It improved Americans' ability to pay household expenses, buy food, and helped reduce anxiety and depression, especially in the poorest households.
There's little reason to believe that Congress will come together to pass a bill that allows for ongoing stimulus checks for all Americans, and perhaps such a bill is unnecessary at his point. Still, there's an argument to be made for targeting recurring assistance to the poorest among us. No senior should have to choose between insulin and food, no child should go to school hungry, and no American should suffer an illness without medical intervention because they can't come up with the cost of an office visit.
If recurring stimulus checks help carry poor Americans through the remainder of the pandemic, it's ultimately good for everyone.
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