By Hailey Ruane
Biden proposed a new stimulus plan on Jan. 14 to create a third stimulus check which would allow $1.9 trillion to be distributed amongst the country. The original plan would have given each citizen who is eligible to receive the checks approximately $1,000. Republican senators created a counter-proposal on Jan. 27 to replace Biden’s plan.
As reported by The Wall Street Journal, the notable difference between the Democratic and Republican proposals “omits measures favored by many Democrats, such as aid for state and local governments and a plan to raise the federal minimum wage to $15 an hour.”
According to CNet, the proposal consists of $600 billion that would be given to people who make a gross income of $40,000 or less. Anyone who makes over $50,000 would have a lower chance of receiving a check. In some cases, people who landed above the $40,000 limit could still receive more money, depending on the number of dependents they claim. Each dependent would result in another $500. Not only would the Republican proposal benefit a more specific audience, it would also change the stimulus check formula that was used to calculate the amount given in the previous stimulus packages.
“That would also change two more variables in the stimulus check formula: the upper limit and the ‘reduction rate,’ the percentage per $1,000 of adjusted gross income that a check is reduced by. Taken together, it means that far fewer people would qualify for a third check if this $600 billion proposal were adopted without any additional changes,” explained a recent CNET article.
For now, the $600 billion proposal is still up in the air, and as The New York Times states, “There was scant evidence, for now, that any Democrats were seriously considering embracing a proposal as limited as the one the Republicans have laid out.”
The first Coronavirus Aid, Relief, and Economic Security Act (CARES), cost the federal government $1.8 trillion. According to The Heritage Foundation, “In 2009… Congress passed the American Recovery and Reinvestment Act. The CARES Act, which passed in March, is more than twice the size of the American Recovery and Reinvestment Act, dwarfing what was previously the country’s largest stimulus package since World War II.”
When comparing the original stimulus package in March to the newest proposal from Republican senators, there is over a $1 trillion difference between the two. For either plan that is approved, there would still be a gap of time to pass before people would start receiving their payments.
Taking into consideration that Congress is currently in a near split between both Republicans and Democrats, the choice between Biden’s and the Republican senator’s proposal could take some time to be finalized.
As stated by CNET, Congress would have to pass the stimulus check and from there it would need to be signed into law, which would lead the first deposit check to be sent by mid-March. After these were sent, paper checks and EIP (Economic Impact Payment) cards would be sent, which would result in the entire process to be completed by early April.
According to The New York Times, Senator Susan Collins (R-Maine), who is one of the leading Senators for the Republican proposal reported that, “All of us are concerned about struggling families, teetering small businesses, an overwhelmed health care system, getting vaccines out and into people’s arms, and strengthening our economy and addressing the public health crisis that we face.”