A recently published study from Columbia University found that the $1,200 stimulus checks distributed as part of the $2.2 trillion CARES Act helped millions of Americans avoid falling into poverty.
Conducted and released by Columbia’s Center on Poverty and Social Policy, the overarching analysis aimed to identify and describe the precise economic impact of the CARES Act – and its stimulus checks and unemployment benefits in particular – on Americans. More broadly, the study explored the possible effects of a second stimulus check and continued government aid.
Financially speaking, artists and music industry professionals are being hit hard by the COVID-19 pandemic, owing to states’ ongoing group assembly restrictions and social distancing guidelines. In turn, the Columbia University study’s insight is especially meaningful for musicians and industry employees.
Towards its beginning, the 18-page-long document explored the cumulative value of the CARES Act’s “transfers,” or direct payments to citizens (via the $600 weekly unemployment bonus and the stimulus checks). The unemployment bonus, which is slated to conclude at this month’s end, crossed the $250 billion threshold, whereas the stimulus payments and other transfer compensation amounted to about $200 billion. For reference, the study also disclosed the 2019 costs of SNAP benefits (roughly $60 billion), SSI (a little over $50 billion), and housing assistance (about $50 billion).
The survey then stated that these CARES Act payments helped low-income individuals (or those without a means of earning a living because of the virus’s preventative measures and market shakeup) to stave off poverty. Specifically, the work compared the pre-COVID-19 crisis poverty rate (12.5 percent) and the estimated 16.3 percent poverty rate that would have emerged without the CARES Act’s assistance when unemployment spiked in April. (Unemployment dropped to 11.1 percent in June, according to government figures, and the CARES Act was signed in late March.)
From there, the analysis projected that even if the unemployment rate was still hovering around 20 percent (as it was in April, accounting for the widely publicized Bureau of Labor Statistics error), the poverty level would decrease to 11.3 percent with high access to CARES benefits.
President Trump has indicated that he’s open to signing legislation for a second round of stimulus checks worth more than a maximum of $1,200 apiece. However, the chief executive also noted that he’ll seek other provisions – including incentives for international manufacturers to relocate to the U.S. and a payroll tax cut – which some members of Congress will likely oppose.
The Democrat-controlled House voted to distribute additional $1,200 payments (to all Americans, including dependents and children) in May, as part of the HEROES Act. Still, the controversial $3 trillion legislation scarcely passed the House vote and was declared “dead on arrival” by Senate Majority Leader Mitch McConnell (R-KY). Today, the Kentucky senator guaranteed that liability protection for businesses will be part of the next relief package. Plus, the 78-year-old lawmaker suggested that those who earn less than $40,000 per year may specifically receive a second stimulus check.
In any event, discussions pertaining to a second stimulus check appear poised to (largely) remain on hold for the next two weeks, as the Senate won’t return from its Fourth of July recess until the 20th.