The latest COVID-19 bill is the third of its kind since the pandemic began last spring and the first since President Joe Biden took office.
Signed on Thursday the Legislation put aside $ 420 billion in direct payments to individuals – in most cases in checks of $ 1,400 – plus $ 350 billion to extend the additional unemployment benefit by several months and $ 130 billion to reopen schools in order to prevent the virus from spreading.
The total price is a staggering $ 1.9 trillion.
The money will spray in many other directions from the US Treasury Department, including vaccine distribution. Most noticeable is a landmark Child benefit. Including: An estimated $ 350 billion in state and local aid, $ 7.25 billion for the small business loan program known as PPP, and $ 4.5 billion for the Low Income Home Energy Assistance Program.
Congressional Republicans who voted against the law sounded weary at its prospect. “The American people do built a parade That’s on the road to victory, “said Mitch McConnell (R-Ky.), Chairman of the Senate minority.” Democrats just want to sprint to the front of this parade and claim credit. “
Even those who supported Biden’s “go-big” strategy for the package, expecting vital help for the working class and an adrenaline rush for the private sector, recognize that the results should be carefully monitored in the future.
For one, Lawrence Summers, the much-quoted mainstream economist, has weighed the general risks.
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“In many ways, an overheated economy with employers desperately looking for workers and increasing wages and benefits would be a very positive thing.” Summers wrote. However, he warned that “policy makers need to make sure they have plans to address two potential and quite serious issues”.
For one thing, he said, there is a possibility that the massive action “will create inflationary pressures such as we have not seen in generations, with ramifications for the value of the dollar and financial stability.” On the other hand, the level of COVID expenditure could displace the necessary investments in infrastructure, energy and schools.
Treasury Secretary Janet Yellen has said Tax increases would already be required now to finance at least part of a large infrastructure, climate and education investment package that Biden plans to unveil later this year.
During former President Donald Trump’s tenure, tax cuts were implemented when federal debt and deficits became outdated for the political right to worry total estimated cost of $ 2.3 trillion.
The most ambitious efforts for a presidential administration seem to come early in their term in office. For Trump, it was the signing of the corporate tax cut law that a GOP congress had pushed through against solid democratic opposition. For Barack Obama it was a recession and the Affordable Care Act. For George W. Bush it was the so-called “war on terror” that was triggered by September 11th. Biden’s pandemic actions shape the early narrative for his tenure, with the perceived success or failure not yet known.