The congressional agreement on Sunday on another dose of aid to fuel the slowing economic recovery has probably spared millions of Americans from a winter of poverty and kept the country from falling back into recession.
For much of the economy — especially people and industries that have been insulated from the worst effects of the pandemic — it may provide a bridge to a vaccine-fueled rebound. That is especially likely if the vaccine is quickly and widely distributed, and the swelling number of coronavirus cases doesn’t force another round of widespread shutdowns.
The injection of money comes months too late for tens of thousands of failed businesses, however, and it may not be enough to sustain unemployed workers until the labor market rebounds. Moreover, it could be the last help from Washington the economy gets anytime soon.
The package requires a vote in both houses, and its text was still being finalized on Sunday. But it is expected to include most of the elements that economists have long said were crucial to avoiding further calamity and aiding a recovery. It extends unemployment benefits for millions at risk of losing them, and adds money to their checks to help pay their bills. It revives the Paycheck Protection Program, which kept many small businesses afloat last spring.
It continues the eviction moratorium and expanded nutrition benefits that have kept many of the most vulnerable families fed and housed during the crisis, according to a statement on Sunday evening from the Democratic leaders in the House and the Senate.
It also provides a new round of direct payments to most Americans. That element was a lower priority for many economists, since many families have maintained their jobs and income through the highly unequal rebound from the shutdowns of the spring. Still, the checks will inject billions of dollars into the economy and will help people who have kept jobs but lost hours or income.
But the aid may not be sufficient to propel the economy beyond the kind of grinding rebound that followed recent recessions. Already, there are signs that the crisis is leaving a lasting economic toll: Long-term joblessness is rising, racial gaps are widening and more people — particularly women — are leaving the labor force.
The cash payments in the new package — up to $600 a person for households and a $300 weekly supplement to unemployment benefits — are half the size of what Congress provided last spring. That means they will provide less of an economic jolt, and won’t do as much to help replenish the savings of jobless workers getting by on benefits that typically total a few hundred dollars a week.
And two programs — one for those not covered by traditional unemployment insurance, and another that provides aid after state benefits expire — will be extended for less than three months. So millions of jobless Americans will lose crucial support if hiring does not pick up significantly in the meantime.
Go to the news source: Stimulus Deal Provides Economic Relief, for Now