personal finance

'We need at least one more check.' The case for a fourth stimulus payment


Signs calling for more relief, a second Paycheck Protection Program and more as part of a campaign by Goldman Sachs supporting small businesses near the U.S. Capitol on Jan. 5, 2021.

BRENDAN SMIALOWSKI | AFP | Getty Images

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Other data suggest Americans are using the money to improve their balance sheets.

A new Bankrate.com survey found people mostly plan to use the $1,400 checks on monthly expenses, day-to-day essentials, paying down debt and savings.

Many respondents to that survey said the money would last less than three months, if that long.

“We need at least one more check,” said Adam Ruben, campaign director at the Economic Security Project.

In the past year, three rounds of stimulus checks — payments of up to $1,200, $600 and $1,400 per person — helped to raise income by 20% for the lowest-income households, according to the Economic Security Project’s new report.

Moreover, the $1,400 checks will help keep 11 million people out of poverty this year, according to the research. In comparison, the new expanded unemployment benefits will help keep less than 4 million from poverty.

“Evidence from the last year shows stimulus checks to be the fastest and most impactful investments helping Americans get through this crisis, lifting more people out of poverty than any other single policy,” the report states.

Additional direct payments would also help minority individuals and households, who have been hit harder financially by the pandemic, according to the research.

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Though the overall unemployment rate is now 6%, the rate is highest for Blacks at 9.6%.

In addition, the research finds that two-third of Black and Latinx households have had difficulty meeting household expenses for the week of March 17 to 29, versus less than half of white households.

D.C. has largely started to pivot towards the recovery and an infrastructure bill.

Ed Mills

Washington policy analyst at Raymond James

To that end, the Economic Security Project is advocating for additional direct payments targeted at those who need the help the most. The group is also calling for improvements to the system to make it so that those payments reach eligible people automatically.

The idea of additional direct checks was recently supported by 21 senators who sent a letter to President Joe Biden.

The gap between the approval of the first $1,200 and second $600 checks shows what can happen if people’s financial needs are not addressed, according to Ruben.

During that time, up to 8 million people slipped into poverty.

“Let’s not do that again. Let’s make these checks automatic,” Ruben said. “Let’s tie them to economic conditions so people aren’t at the mercy of Washington gridlock.”

So far, experts have said the prospect for a fourth stimulus check are tentative at best.

“D.C. has largely started to pivot towards the recovery and an infrastructure bill,” Raymond James Washington policy analyst Ed Mills recently said.

However, additional cash payments are slated to go to parents starting in July with implementation of the enhanced child tax credit

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The Economic Security Project is also calling for the expansion of that credit, as well as the earned income tax credit, to be made permanent.



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