President-elect Joe Biden unveiled details on a massive stimulus plan that he hopes will kick-start the U.S. economy.
Dubbed the “American Rescue Plan,” the proposal includes various government stimulus efforts designed to sustain individuals and businesses until the Covid-19 vaccine is more widely available.
The plan includes:
$1400 direct checks to most Americans
Increasing the federal unemployment benefit to $400 per week through the end of September
Increasing the Federal minimum wage to $15 per hour
An extension of eviction and foreclosure moratoriums until the end of September
$350 billion in state and local government aid
$170 billion for K-12 schools and higher education institutions
$50 billion towards Covid-19 testing
$20 billion toward national vaccine program with states
A $3,000 per child tax credit ($3,600 for children under the age of 6)
Democrats are applauding the proposal, arguing it’s necessary given the challenges America now faces.
Meanwhile, there are some indications that the proposal could receive bi-partisan support. Senator Macro Rubio (R-FL) had argued for President Trump’s $2000 direct payments proposal and had already written to Biden earlier in the week to push for money to individual Americans.
New unemployment numbers released today show that the number of Americans filing for unemployment in the last week totaled 965,000, the highest since August 2020.
“Money We Don’t Have”
Skeptics argue that this is money we do not have and could penalize future generations by burdening them with debt. As our friend and economic columnist Neil Grossman writes, artificial stimulus from Washington will give our economy at sugar high, but in the long run, puts America at risk for becoming a third-world economy.
More Stimulus On the Way in February
Meanwhile, the Biden team says…this is just the beginning.
A second stimulus is in the works and will be revealed in February. In round II, the President-elect intends to address job creation, infrastructure reform, the importance of combating climate change and advancing racial equality.
The stock markets were primarily flat in Thursday trading. The Dow ended off 0.22% at 30,991 and the S&P 500 traded down 0.38% at 3795. Meanwhile, the NASDAQ Composite Index traded down 0.12% closing out the session at 13,112.
Futures markets were little changed on the Biden news.