Economists are nearly unanimous about one thing Americans desperately need to weather the coronavirus crisis and economic downturn: cash.
A family of 4 could get $18,000 this year under a cash bill by Senate Democrats
Michael Bennet, Cory Booker, and Sherrod Brown want as much as $4,500 per American, adult or child, paid out in 2020.
Dylan Matthews was a senior correspondent and head writer for Vox’s Future Perfect section. He is particularly interested in global health and pandemic prevention, anti-poverty efforts, economic policy and theory, and conflicts about the right way to do philanthropy.
The chief economists for both George W. Bush and Barack Obama have endorsed unrestricted cash checks as a stimulus measure and, more importantly, as a way to buy food, pay rent, and otherwise survive as mass layoffs are occurring and hourly workers aren’t picking up paychecks.
The idea got its biggest boost yet on Tuesday when Treasury Secretary Steven Mnuchin told reporters the White House wants to pass a cash program that can distribute money to households ASAP. Other conservative politicians like Sens. Mitt Romney (R-UT) and Tom Cotton (R-AR) are on board the cash caravan, with Romney arguing for an immediate $1,000 check for every adult in America.
Some Democratic senators want to go much bigger than that. Sens. Michael Bennet (CO), Cory Booker (NJ), and Sherrod Brown (OH) drafted a letter to Senate party leaders Mitch McConnell and Chuck Schumer calling for immediate $2,000 payments to all adults and children in the US below a certain income threshold ($90,000 for singles and $180,000 for couples is one number I’ve heard floated by sources familiar with these discussions). You can read their whole plan in the appendix to the letter here.
Under the plan, if the US is still in a public health emergency in July, Americans would get another $1,500 each. If the same is true in October, everyone would get another $1,000. If the public health emergency is over in either July or October when the Treasury secretary does his quarterly check-in, but unemployment has increased by a single point, the checks still go out. If unemployment rises by half a point, the checks are cut in half, but they still go out.
Americans could get as much as $4,500 per person, or $18,000 for a family of four, if all the payments outlined in the plan go out.
Bennet, Brown, and Booker are joined so far by their colleagues Sens. Angus King (I-ME), Chris Murphy (D-CT), and Brian Schatz (D-HI). In a way, they’ve been preparing for this moment since 2017, when Bennet and Brown unveiled the American Family Act, their plan for monthly $250 or $300 checks to parents to take care of their kids, with bigger checks going to parents of young kids. Thirty-seven out of 47 Senate Democrats are co-sponsors on that bill.
But while the American Family Act is meant as a permanent measure to reduce child poverty and support families burdened with child care costs, the Bennet-Brown-Booker cash plan is meant as a coronavirus-specific measure to support adults and kids alike at a time when many people are out of work and restaurants and nonessential businesses are being shuttered. It’s a flexible approach that does not require the government to specifically identify who’s been most impacted by the crisis; that kind of targeting is sometimes helpful, but in a crisis it can be incredibly inefficient.
The Bennet, Brown, and Booker bill is the most ambitious Democratic plan to date, but it’s not the only one. Democratic Reps. Tim Ryan and Ro Khanna were the first in Congress to offer a cash bill, and proposed giving at least $1,000 to every American making under $65,000, and as much as $6,000 to some families with children. Rep. Ilhan Omar (D-MN) has proposed $1,000 per adult and $500 per child as a one-off measure:
Rep. Joseph Kennedy III (D-MA), currently challenging Sen. Ed Markey in his state’s US Senate primary, has called for $4,000 per adult, $1,000 per child, and $2,000 per adult making more than $100,000:
And more detailed plans from both Schumer and the White House are expected soon.
We don’t yet know what form any cash legislation that passes will take. But it’s becoming increasingly clear that cash legislation to deal with coronavirus will pass, and soon. The big question then is how generous the legislation is, and if it’s closer to the Bennet-Booker-Brown end of the spectrum, with multi-thousand-dollar checks to every adult and child, or to the Romney end, with only $1,000 per adult.
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