Trump wants second stimulus checks to be more than $1,200. Experts question whether that’s the right relief

Personal Finance

U.S. President Donald Trump delivers a speech during a tour of the Double Eagle Energy Oil Rig in Midland, Texas, July 29, 2020.

Carlos Barria | Reuters

Both parties are now working to come to a consensus on issues where they are divided, particularly unemployment insurance. The extra $600 per week in federal unemployment benefits expires this month. Lawmakers are at odds over how much extra help they want to provide to jobless Americans going forward.

The second stimulus checks would include up to $1,200 for individuals or $2,400 per married couple, plus $500 for dependents, according to the Republicans’ HEALS Act. This time, however, the definition of dependents would be expanded to include adults. Last time, those payments were limited to children under age 17.

Both sides of the aisle apparently have come closer to an agreement on the second stimulus checks. Both bills call for sending up to $1,200 to individuals under similar terms to the first checks in their legislative proposals.

But a group of Republican senators on Thursday unveiled a new proposal calling for $1,000 stimulus checks for both adults and children with valid Social Security numbers. A family of four would stand to receive $4,000.

The government appropriated a total of approximately $300 billion toward the CARES Act stimulus checks. So far, the government has deployed about $260 billion of that money, the Treasury Department has said.

“If you increase the value of the checks, it would certainly increase the total cost,” said Adam Michel, senior policy analyst at the Heritage Foundation, a conservative think tank. “If you’re still going to stick to a $1 trillion target, you would have to reduce things elsewhere.”

The payments may not provide the intended boost to the American economy because many people aren’t spending because they’re afraid to leave their houses amid the coronavirus pandemic, not necessarily because they don’t have the resources, he said.

“This idea that these checks have been termed stimulus checks doesn’t mean that they’re actually stimulative in any way,” Michel said.

Chuck Marr, senior director of federal tax policy at the Center on Budget and Policy Priorities, a nonpartisan think tank, said he thinks Trump’s comments are “perplexing” in light of the proposals from both Democrats and Republicans.

Other forms of financial aid should come first, Marr said, including expanded unemployment benefits for people without jobs, eviction protections for those in danger of losing their homes and nutrition assistance for those with limited access to food.

“These are all very targeted, very important proposals that need to be in there first,” Marr said. 

Stimulus payments would be helpful, he said, though they are somewhat broader in terms of whom they would help.

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