The IRS is in the process of sending out a third round of stimulus checks to support Americans through the ongoing coronavirus crisis. And, in true American fashion, some people are already asking for more.
According to back-of-the-envelope math, the federal government has issued 434 million payments in the past 12 months. That's roughly $737 billion that went toward buying groceries, paying rent and increasing people's savings accounts in a turbulent economic time. But as vaccine distribution ramps up and the country reopens, will there be a fourth stimulus check?
It's not an outlandish proposition. Kamala Harris, before she was vice president, advocated for $2,000 monthly payments for people who made up to $120,000. In January, more than 50 House Democrats wrote a letter to Harris and President Joe Biden calling for “recurring cash payments” that would “continue until the economy recovers,” going to “those who need it most and will spend it the quickest.” In early March, a group of senators wrote their own letter to that effect, noting that "this crisis is far from over."
Here's what experts say.
Pandemic politics could prevent another payment
Right now, any speculation on a fourth stimulus check is just that: speculation, says Columbia Business School professor R.A. Farrokhnia. But there are several trends we can examine to predict how the debate might unfold.
With the first stimulus check, which was passed as part of the CARES Act, there was urgency. Last spring, the nation didn’t quite know what it was dealing with yet — just that people needed financial assistance ASAP.
“When you’re in such a scenario, there is less of a concern for partisanship,” says Farrokhnia, who is also executive director of the Columbia Fintech Initiative. “With each [subsequent] round, the conversation became a little more heated, a little more philosophical, within the political establishment.”
He’s right: Nancy Pelosi and Mitch McConnell fought a lot last year, with the latter calling stimulus checks “socialism for rich people.” Any suggestion of a fourth check would probably spark similar conversations. The debate would likely be dramatic and drawn-out.
In addition, given the fact that last time not even all Democrats were on board with the proposal, the legislation would have to be extremely targeted to make it through Congress. Lawmakers would make a concerted effort to avoid paying people who don’t actually need help. Farrokhnia says this means there could be “more resistance to blank-check” a fourth direct payment.
Congress will closely monitor the status of the economy
David Hopkins, an associate political science professor at Boston College, says the chances of a fourth stimulus check also may depend on how the economy performs in the next couple of months. The American Rescue Plan extended extra unemployment benefits through September, which he says indicates the timeline lawmakers have in mind for revisiting the issue.
By summer, depending on how vaccination goes, it could be a different world — and that could seriously change the conversation.
“Does it look like the country is returning to normal?” Hopkins adds. “I think if that’s true, the pressure will abate for another round of stimulus checks. If there’s still a feeling that there’s widespread distress and widespread demand for more of these direct payments, I think there’ll be much more interest.”
In a scenario like that, a narrow proposal would probably become law the fastest (as opposed to tucking the checks into a gigantic, multi-pronged stimulus package). Stimulus checks are generally popular among voters, so Hopkins says if Democrats were to put up a standalone bill, they could likely find some Republican support.
But again, that’s a while off, if at all.
Checks may not be a priority in the next stage of recovery
Eileen Appelbaum, co-director of the Center for Economic and Policy Research, is also looking to the future. She says that the previous stimulus checks weren’t really intended to be stimulating in the way you might think — instead of giving money to people to spend at bars and movie theaters, they were stopgap measures to help people put food on the table. In her eyes, the American Rescue Plan was indeed a rescue plan.
“What's coming next is going to be a stimulus plan,” Appelbaum says. “I would be really surprised if there’s another stimulus check going out to households.”
Crisis mode is over. Instead, she predicts the Biden administration will pivot into growth. The president will likely tackle physical infrastructure as well as what she calls care infrastructure, which includes improving child care, elder care, paid family leave and such. He’ll also prioritize the environment.
The White House may expand unemployment again, but Appelbaum says she doesn’t see “a role or a desire to send checks to everybody as they have done in the past.”
Bottom line? A fourth round of stimulus checks is not impossible, and nobody knows exactly what will happen. But you probably shouldn’t count on another payment, especially not in the near future. More targeted investment is the key for politicians moving forward.
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Rates are subject to change. All information provided here is accurate as of the publish date.