Without the U.S. bailout plan, the national economy would benefit millions of Americans and make the situation of the population even worse.
Pamela Cruz. Peninsula 360 Press. [P360P].
Without the recently approved U.S. bailout plan that provides for the $1.9 trillion financial relief package pushed by President Joseph Biden, the substantial hardship and uncertainty in the national economy that millions of Americans have suffered over the past year would have worsened even further, particularly among African Americans, Latinos and Native Americans.
This was stated by Chad Stone, Chief Economist at the Center on Budget and Policy Priorities, who added that the economic relief plan will address three points: First, getting the SARS-CoV-2 virus under control so that the economy and life in general can operate more safely and normally.
Two, to alleviate the uncertainties and hardships that have been experienced by many Americans over the past year, and which would have worsened had this relief not been enacted; and third, it provides a substantial stimulus to an economic recovery that, frankly, has stalled halfway back to full employment.
During a briefing held by Ethnic Media ServicesThe expert stressed that programs that alleviate hardship and give money to people who will spend it quickly, such as unemployment insurance and nutrition assistance, are very useful in stimulating economic activity and employment once it is safe to return to work.
"Controlling the virus is the most important thing to deal with the difficulties, but there will also be stimulus that will put us back on the path to recovery," Chad Stone stressed.
This law, he said, expands the availability of nutrition assistance to help address extraordinarily high levels of hunger and poverty, in addition to making comprehensive health coverage more affordable and accessible to millions of people during the current crisis.
And, he recalled, the support includes critical housing assistance for millions of people struggling to pay rent and avoid evictions, as well as providing much-needed funds for communities to cope with homelessness during the pandemic, and emergency funds to help families with the lowest incomes.
"I should stress that all of these provisions are short-term, they are not permanent. But they provide guidance on the kind of policies that we might want to have in place in the future on a permanent basis," he stressed.
Regarding unemployment insurance, he said that the expansions in unemployment benefits in the pandemic have been "an imperfect miracle", as they have been substantial, however, they are temporary.
In that sense, he explained that the rescue plan extends until September 6 three key unemployment programs: The first, additional weeks of benefits to people who exhaust their regular state benefits; The second, called the Emergency Unemployment Compensation Program, which is really important for people who do not qualify for regular state benefits; And the third, a federal supplement of $300 per week to the regular benefits of all unemployment programs.
"These measures ensure that no one runs the risk of running out of unemployment benefits before finding a job, but only through the week ending September 6," he said.
Finally, he pointed out that it will be necessary to wait for Congress, before going on its summer recess, to analyze the economic conditions and decide whether it is reasonable to let these benefits expire on September 6 or to extend them.
Healing and moving forward
Congressman Raja Krishnamoorthi, representing Illinois' 8th District, said the package "will help our economy heal and, of course, will help the United States recover from the health crisis, and I think it's a great victory for the American people.
He further stated that local aid is basically necessary for two reasons: one, because revenues from sales taxes and other sources of tax revenue have declined drastically for many states and local municipalities in the jurisdictions.
In that regard, he noted that those governments, in particular, face one of two options: raise taxes or cut services, or potentially do both, "but neither of those options is acceptable during a pandemic."
"Yet because of our inaction to this point at the federal level, 1.4 million government workers have been laid off, many of whom are first responders needed to fight COVI-19," he stressed.
He noted that the reality is that many of these governments need additional revenues and to fill gaps, so taxpayers should be spared tax increases or cuts in taxes and services.
A Plan that shakes hands with children
At the meeting, Elaine Maag of the Urban Institute Policy Center noted that economic impact payments, sometimes called clawback rebates, and an increase in the child tax credit are cash benefits that will help a large share of low-income families.
He explained that in 2021, Urban Institute researchers estimated that poverty would be around 14 percent unless action was taken. This figure hides some important differences, since while white families would have a poverty rate of less than 10 percent, black families would have a poverty rate of 18 percent, while in the case of Hispanic families the percentage rises to 22 percent.
In this regard, he said that the American Rescue Plan will substantially reduce these rates. The poverty rate for white families would be reduced by 26.4 percent, for black families by 10.5 percent and for Hispanics by 13.3 percent.
"In other words, the law would reduce the poverty rate for children by 7.0 percent, which is a larger cut than that projected for adults aged 18 to 64 or for those over 65."
He added that poverty harms children throughout their lives, as early brain development is affected, resulting in slower and stunted growth. "They get worse jobs, their health is worse and they live shorter lives."
He indicated that all of those things are bad for the children affected, but also for society, because before the pandemic child poverty was 11 percent. "So it has increased during this pandemic, but the American Rescue Plan would bring the child poverty rate down well below pre-pandemic levels."
However, he stressed that it is not just a matter of relatively high poverty, as the situation has exacerbated other problems, such as financial and food insecurity, which has almost doubled in the case of families with children.
"Nearly a quarter of families with children report not eating a balanced meal or skipping meals or reducing portion sizes because they don't have enough money to eat."
The story is worse for families with African-American or Hispanic parents, where about four in 10 families reported being food insecure, and about 17 percent of renters reported being behind on their payments.
"The problem is the lack of cash, people need unrestricted funds to catch up."
Elaine Magg stated that President Biden's American Rescue Plan expands the credit in four important ways: number one, the credit will be fully refundable. Families will receive the full value of the credit, even if they do not work; number two, the credit will now include children who are 17 years old; and number three, the maximum credit will increase for most families from two thousand dollars per child to three thousand six hundred dollars per child under age 6.
The need for a minimum wage
ROC United President and CEO Dr. Sekou Siby explained at the time that 27.1 million service workers are women, people of color and immigrants, while more than one-third of the nation's service workers do not have enough money to make ends meet.
12 percent of service workers live below the poverty line, of which 85 percent are, again, women, people of color and immigrants. Overall, 17 percent of all service workers rely on public strategies, such as food stamps and Medicaid, while working longer hours just to make ends meet, she said.
The minimum wage in California is $12 per hour on average, in Mississippi it is $17.25, however, for those who work in the service area, he noted, in California it is $13 on average, and in Mississippi it is $9, while a living wage in California is $18.66 and in Mississippi it is $13, "you can see the gaps."
"We have a huge gap between what people need to live on and what they are actually getting, which is why there is such a high dependency on government subsidies."
With the American Rescue plan, 553,000 children will be lifted out of poverty and 460,000 restaurant workers who are parents will also benefit from the rescue package, "so it's a great deal nationally," he said.
In that sense, he stressed that to see meaningful and impactful change in the country's society, it is necessary to increase the wages of all workers and "build a ladder" by creating upward mobility and opportunities for all, especially women of color and immigrants?
And, he noted, "it is not dignified for workers to work full time and still depend on public assistance". He said that, due to the pandemic, paid sick days have become a priority for workers.
While small businesses will begin to pick up after the COVID-19 pandemic closures, wage increases will be phased in gradually until there is a win-win situation for both parties.
Finally, he pointed out that the wage increases for service and agricultural workers will help undocumented people also receive assistance, since the U.S. Rescue Plan will not support them.
