A second stimulus examine might nonetheless be included within the closing stimulus bundle of the 12 months, but it surely might be value half of the $1,200 most of the primary examine. President-elect Joe Biden is pushing for extra stimulus aid in early 2021 — probably within the type of a third stimulus examine for individuals who meet the eligibility necessities.
“The stimulus bundle has occurred,” Biden stated Wednesday, referring to the state of negotiations over a brand new $900 billion stimulus invoice and a second stimulus examine. “And it appears to be like like there’s going to be direct money funds. But it surely’s a down fee — an vital down fee — on what is going on to need to be carried out on the finish of January and into February.”
Whereas each the Home of Representatives and the White Home might be led by Democrats, two runoff elections in Georgia on Jan. 5 will decide which social gathering controls the Senate. It’s going to additionally decide whether or not or not Congress considers a bigger stimulus bundle and maybe a 3rd fee within the new 12 months.
Whoever controls the Senate could make or break a bigger stimulus examine
Biden has known as on Congress to go extra support now, within the lame-duck session, earlier than he assumes workplace on Jan. 20. However the president-elect stated something Washington sends now would “at finest solely be a down fee” on extra substantial support he intends to suggest as soon as he takes workplace.
As a Democrat, Biden’s path to getting financial support authorised — together with a second examine — might be a lot smoother if Democrats additionally maintain each chambers of Congress within the new 12 months. Within the subsequent Congress, which begins within the first days of January, Democrats will maintain a slim majority within the Home.
Management of the Senate, nevertheless, will rely upon run-off elections in Georgia on Jan. 5 for 2 Senate seats. If Democrats win each elections, the social gathering will management the Senate with 50 seats — 48 Democrats and two independents who caucus with the social gathering — and Vice President-elect Kamala Harris’ having the facility to interrupt ties.
If Republicans win one or each seats in January, the GOP will maintain management of the Senate and Biden will begin his time period with a divided authorities, with a Republican social gathering led by McConnell, who might oppose a second examine for the expense.
Stimulus checks are well-liked and costly
The IRS has stated it spent round $270 billion to ship 160 million stimulus checks, but it surely’s seemingly that whole quantity, as soon as catch-up funds are added in, is nearer to $300 billion. That is sufficient cash to maintain a second stimulus take a look at of the present stimulus invoice, based on a Washington Submit report.
Many economists argue now just isn’t the time to rein in federal spending, with the economic system struggling to get again on its toes. As a substitute the federal authorities ought to look to ship out extra support to prop up the economic system.
“Being timid in our coverage options throughout this disaster could be a mistake,” wrote William Gale, senior fellow within the Financial Research Program on the Brookings Establishment. “Congress must allocate extra assets — trillions of {dollars} — for aid and stimulus to assist individuals and companies.”
For tens of millions of taxpayers, the majority of the stimulus money paid for food, rent and utilities and debt, with a quarter going into savings, according to a Census Bureau survey from this summer. With Biden warning the country is heading into a “dark winter” — facing a spike in coronavirus cases across the US and an economy continuing to shed jobs — a second check would likely find similar uses.
Since this summer, however, some Republicans in Congress have balked at funding another large aid package as the US deficit has climbed, and Senate Majority Leader Mitch McConnell has repeatedly said that any bill will need to have a significantly smaller price tag than the $2.2 trillion proposal pushed by House Democrats through the fall to get Senate Republican support.
If Republicans keep Senate control, here’s what could happen
While the group of Republican and Democratic senators who worked on December’s bipartisan stimulus package points to a possible path of cooperation between Biden and the next Congress, it is just as likely that Senate Republicans could try to rein in spending if they retain control of the upper chamber.
If Biden does face a divided Congress, he will most likely do what every president has done when one or both chambers is in the other party’s hands, and look for areas where the two sides can find common ground. Passage of a new sweeping stimulus package might be off the table, but smaller aid proposals focused on specific needs — such as an increase in the minimum wage or another stimulus check tightly focused on those most in need — could find bipartisan support.
Biden could also look at executive actions to accomplish some of his goals, much as President Donald Trump did this summer with a series of executive orders. But without spending authority (only Congress has that), Biden would be limited in what he could accomplish without Congressional help — he wouldn’t be able to access the funds to send a second check.
As we wait for the new Congress and the Biden administration to step up next year, here’s where negotiations stand on another stimulus check, which benefits could be renewed if Congress decides to pass another bill and how soon you could expect to receive a second payment once it’s approved in Washington.