Economy & Business

There’s More to the COVID-Relief Bill than ‘Just’ $600 Checks

A barber shop in Encinitas, Calif., closed as new stay-at-home orders begin in Southern California during the coronavirus outbreak, December 7, 2020. (Mike Blake/Reuters)
It just isn’t true that direct payments are the only help most at-risk Americans will get from the package.

After President Trump’s demand that the new COVID-relief bill increase direct payments from $600 to $2,000, many prominent politicians complained that struggling Americans would be receiving checks of “just” $600. Representative Tulsi Gabbard, Georgia Senate candidate Jon Ossoff, Senator Bernie Sanders, and many Twitter activists have all expressed frustration at this supposedly paltry offering to taxpayers. But the idea that relief checks are the only thing most at-risk Americans will be receiving from the bill Trump eventually signed, which stuck to the $600 figure, is a complete fabrication.

Indeed, the direct payments of $600 to most Americans (a phase-out does apply at higher income levels) account for “just” $166 billion of the legislation’s $900 billion in aid, much of it aimed at helping the hardest-hit individuals and businesses.

The bill extends a policy that provides an extra $300 per week from the federal government to unemployed Americans on top of existing state-level unemployment benefits, while also lengthening the period in which the unemployed remain eligible for benefits. (It’s worth noting that this was also the case in the last COVID-relief bill; though that legislation’s $1,200 checks were criticized as insufficient, they were ancillary to its extra $600 per week in federal aid to the unemployed.)

Americans struggling to pay their bills are likely to see far more benefit from these provisions than from the bill’s $600 checks. A family with two unemployed parents would receive an extra $2,400 in additional federal benefits each month from this package, on top of state unemployment assistance. That, and not the one-time checks, should be the focus of any analysis of how the bill is helping struggling families. It’s much more impactful, and at a cost of $120 billion, it’s also much more efficient than the alternatives; raising the value of the relief checks sent to individuals to $2,000, as the president demanded, would have increased the cost of the bill by $370 billion — and that’s assuming the checks were given only to adults.

The remaining funds in the relief bill would also attempt to target at-risk sectors of the economy. The Paycheck Protection Program, which provides small businesses with loan funds, would receive $284 billion in funding to help keep them afloat and prevent them from having to lay off employees. Another $80 billion or so is set aside aid to specific businesses and industries deemed to be at the highest risk.

Outrage over this relief package also comes from misleading information about COVID relief in other nations. For one, other countries are not providing every one of their citizens thousands of dollars per month, as a graphic shared by actress Alyssa Milano suggests. In fact, most European countries are doing much the same as the United States, offering expanded unemployment benefits rather than direct checks. Milano’s graphic calculates expanded unemployment benefits in other countries while ignoring them in the United States, where COVID relief has been more generous than in most developed countries.

It is fair to criticize the manner in which the latest relief bill was produced; combining the legislation with the normal appropriations process has caused unneeded confusion. For instance, in an address earlier this week, President Trump called COVID relief “wasteful,” citing, among other provisions in the package, the foreign aid it included. Yet that foreign aid is not part of the package’s coronavirus relief; it is included in every annual appropriations bill, and most of it was included in the president’s budget proposal.

Efficiently and effectively allocating scarce relief funds to help struggling American families in a time of national crisis is a monumental enough task without the spread of misleading information about the nature of the legislation. While the process followed to create the bill left much to be desired, the fact is that the bulk of the aid it contains is targeted at those who need it — and that’s a good thing.

Andrew Wilford is a policy analyst with the National Taxpayers Union Foundation, a nonprofit dedicated to tax-policy research and education at all levels of government.


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