Collection: Coronavirus Relief & Economic Stimulus
Analysis of the CARES Act, American Rescue Plan, and Other Pandemic Relief
In response to the 2020 economic recession, the U.S. enacted relief packages which stimulated the economy and lifted millions out of poverty. This marked a complete shift from the response to the Great Recession, a period when banks were given golden parachutes while countless families lost their homes. Although still imperfect, this response demonstrated that politicians had at least learned some of the lessons of the Great Recession, if not all.
I began writing the Economic Justice and Progress Newsletter at a time when the economic recovery was stalling while politicians were debating whether they should pass additional relief. Because far too many members of Congress seemed unconvinced that enacting policies which benefit everyone is a good idea, I attempted to break down the benefits of such policies and advocate for passing additional relief in this series.
Throughout my Coronavirus Relief and Economic Stimulus series, I argue for enacting policies which benefit everyone, alleviate unnecessary suffering, and stimulate the economy in the process. These policies include the following legislation:
The CARES Act
The Consolidated Appropriations Act of 2021
The American Rescue Plan Act
This series goes through economic studies, BLS data, and legislative text to get a better understanding of how and why Congress passed these relief packages. If you want articles like these sent to your inbox as soon as they are published, sign up for free by clicking the Subscribe button.
Part 1: Consolidated Appropriations Act
Coronavirus Relief and the Slowing Economic Recovery
At the height of the third wave of COVID-19 infections, as the U.S. economy began losing jobs again for the first time since April 2020, Congress added additional Coronavirus relief spending to its 2021 budget. The two provisions included in this relief package which impacted the broadest groups of people were:
$600 Economic Impact Payments
$300 per week in federal unemployment insurance benefits, extended through March 2021
I outlined evidence that the pandemic disproportionately impacted marginalized communities, that far too many families across the country are suffering unnecessarily, and that Congress could instead intervene as they had in the past. While this relief package was better than nothing, it paled in comparison to the CARES Act and the American Rescue Plan.
Part 2: The CARES Act
CARES Act Relief and the Need for Economic Stimulus
While additional relief was still being negotiated in Congress throughout early 2021, I reviewed economic studies which examined the CARES Act and its impact on working families. It had many provisions aimed at “targeting” those most impacted by the pandemic, but I once again focused primarily on the relief which reached broader groups of people:
$1,200 Economic Impact Payments
$600 per week in federal unemployment insurance benefits, which expired in December 2020
I continued analyzing economic studies as I had in the previous article, and I argued that coronavirus relief and economic stimulus helps everyone. What’s more, although the economic recovery is still underway in 2021, we later learned that the CARES Act helped make the 2020 recession the shortest recession in U.S. history.
Despite such widespread benefits, I also briefly discussed shortcomings of the CARES Act, although many of my criticisms amounted to insufficient and poor execution of otherwise solid relief. Many of these shortcomings could have been averted if our social safety net were not in such disrepair, but these problems are solvable.
I made not only an economic case, but also a political case for further relief. I echoed Senator Bernie Sanders’ concerns about abandoning working families during an economic downturn, despite the Democratic party controlling Congress and the White House, and how a similar situation precipitated an electoral defeat in 2010.
We must not repeat the same mistakes before the 2022 Midterm Elections.
Part 3: The American Rescue Plan
The American Rescue Plan and Maintaining Momentum
President Biden’s relief package included many provisions its predecessors did not, but many came at the cost of compromise. Throughout this article, I describe what made the final cut, what was taken out, and some important differences between the American Rescue Plan and other Coronavirus relief bills.
I spent more time going into certain details, such as the Child Tax Credit expansions, but still emphasized the “transfer” payments like I did in prior articles:
$1,400 Economic Impact Payments
$300 per week in federal unemployment insurance benefits, extended through Labor Day 2021
I also included a comparison between who stood to benefit from the American Rescue Plan and who benefited from the Trump tax cuts. However, because we still have a great deal of work to do before we can address systemic deficiencies in our economy, I argued that Congress needs to maintain this legislative momentum to bring about a more just economy.
Part 4: Census Bureau Data
Coming Soon - Census Bureau Report on Income and Poverty
As more time goes by, analysts will gain further insights into the impact these relief packages had on the economy. One such report was recently released by the U.S. Census Bureau titled Income and Poverty in the United States: 2020.
As shown in the infographic below, this report revealed that—although the official poverty rate, which does not take into account assistance programs for low-income families, increased—the Supplemental Poverty Measure rate, which does, decreased.
I plan to examine these details in further detail and discuss the ways in which Coronavirus relief bills played a role.
Economic Justice and Coronavirus Relief Policies
One of the most flagrant examples of economic injustice in living memory was the Wall Street bailouts during the Great Recession while working families were losing their homes. We are beginning to learn the lessons of making such mistakes, but unnecessary suffering still abounds. It doesn’t have to be this way.
I write this series with the hopes that I can help readers understand legislative successes and missteps, what works and what doesn’t, and to help set the record straight. People should know that a better world is possible, that we have used public funds to help everyone rather than the already wealthy, and that we can do so again.
We can lift people out of poverty and prevent others from falling into poverty. We can insure workers against the risk of being unable to work in a safe environment. We can provide people with access to healthcare without bankrupting working families. We can mitigate economic downturns and alleviate unnecessary suffering in the process.
When we do so, and we grow the economy from the bottom up and the middle out—rather than continually trying to give credence to the farcical myth of “trickle down” economics—we can bring about a more just economy that works for everyone.
Feedback & Support
Do you agree that public funds should benefit everyone rather than just corporations and the wealthy? Do you agree that economic downturns harm everyone and that we should use every tool at our disposal to make recessions as brief as possible?
Or do you disagree and think that public funds should only be used to bail out Wall Street every time they carelessly or even fraudulently lose gambles? Should public funds be used to subsidize massive corporations that abuse and exploit their workers?
If you disagree with my conclusions, do you also think that economic recessions should be prolonged if sluggish recovery can be blamed on your political opponents? If you have more nuanced disagreements with certain details, and agree with other points, I’d also like to hear from you.
Whether you agree or disagree with my conclusions, I hope you learned something new after reading my newsletter, and I welcome constructive feedback. Feel free to leave a public comment or email me to share your thoughts.
I also encourage you to share this newsletter with any friends or family members who might learn something, or who might be interested in (or skeptical of) progressing towards a more just economy.
If you enjoy these articles and want to support my writing, please consider a paid subscription or donating. Thanks to the support of readers like you, I can remain independent from corporate influence and share my honest opinions about progressing towards a more just economy.
Thank you for reading my newsletter and taking the effort to learn about making the world a better place. I look forward to hearing your thoughts on how we can make progress towards a more just economy.
-JJ