Data released on Tuesday showed that President Joe Biden’s proposed round of $ 1,400 direct payments included in his $ 1.9 trillion relief account for COVID-19 may not benefit families earning more than $ 75,000. per annum.
Some lawmakers expressed concern that Biden’s proposal did not reach American families in need and called for direct payments to be sent only to families earning less than $ 75,000 a year. Biden’s plan would provide direct payments to most American families, including some classified as high-income.
According to data from the Opportunity Insights Economic Tracker, January’s $ 600 stimulus payments had little effect on spending by high-income families. Families that earned more than $ 78,000 spent only an average of $ 45 of the $ 600 in direct payments, an increase of 0.2 percentage point in spending. Families that earned $ 46,000 or less showed an increase in spending of 7.9 percentage points between January 6 and 19.
If Biden’s proposal is approved as is, Opportunity Insights estimates that families earning more than $ 78,000 a year will spend only $ 105 of the $ 1,400 direct payments.
Newsweek contacted the White House for comment.
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Biden’s plan also includes an increase in unemployment insurance and an increase in the minimum wage to $ 15 an hour. The financing of a national vaccination program and the reopening of schools are also part of Biden’s proposal.
Senators on both sides of the corridor held a conference call on Sunday about Biden’s proposal, looking for ways to cut the cost of the project. Limiting the number of families receiving direct payments has been identified as a potential solution.
According The Washington PostMaine Republican Senator Susan Collins said during the call that, in her state, “if you have a family of five with an income in excess of $ 300,000, it is unlikely that you have been financially harmed by the pandemic.”
Biden said at a news conference on Monday that he would consider lowering eligibility requirements for direct payments if it meant that Senate Republicans would support the proposal.
“As a bipartisan, I thought it would increase prospects for approval – the additional $ 1,400 in direct cash payments to people,” said Biden, adding that he was “open to negotiating” aspects of the proposal.
On Tuesday, Senate majority leader Chuck Schumer said that Democrats could follow Biden’s proposal without negotiating with the Republican Party. Schumer told Democrats in a conference call that the vote on a budget resolution “could take place as early as next week”.
Schumer could use a tool called budget reconciliation, which would allow Biden’s proposal to pass the Senate with a simple majority, instead of the 60 normal votes needed for approval. Reconciliation would also limit the time that lawmakers could debate the proposal to 20 hours, avoiding any attempt at obstruction.
“We can complete much of the COVID bill with reconciliation,” Schumer told MSNBC on Monday, “and this is something we will certainly use if they try to block this immediate COVID bill.”