New Analysis Supports Limiting Third Stimulus Check To People Earning Less than $ 75,000

Data released on Tuesday showed that President Joe Biden’s proposed cycle of $ 1,400 of direct payments included in his $ 1.9 trillion COVID-19 relief bill may not benefit households earning more than $ 75,000 a year. .

Some lawmakers have expressed concern that Biden’s proposal does not target American families in need and have called for direct payments to be sent only to households earning less than $ 75,000 a year. Biden’s plan would provide direct payments to most US households, including some classified as high income.

According to data from the Opportunity Insights Economic Tracker, January’s stimulus payments of $ 600 had little effect on spending by high-income households. Households earning more than $ 78,000 spent an average of only $ 45 of the $ 600 in out-of-pocket payments, a spending increase of 0.2 percentage point. Households earning $ 46,000 or less posted an increase in spending of 7.9 percentage points between January 6 and January 19.

If Biden’s proposal is approved as is, Opportunity Insights estimates that households earning more than $ 78,000 a year will only spend $ 105 of the $ 1,400 in direct payments.

Newsweek has contacted the White House for comment.

Biden’s plan also includes an increase in unemployment benefits and an increase in the minimum wage to $ 15 an hour. Funding for a national immunization program and reopening schools are also part of Biden’s proposal.

Senators on both sides of the aisle held a conference call on Biden’s proposal on Sunday, looking for ways to lower the cost of the bill. Limiting the number of households receiving direct payments was cited as a potential solution.

According to The Washington Post, Republican Senator for Maine Susan Collins said on the call that in her state, “If you are a household of five with an income over $ 300,000, you are unlikely to have been financially harmed by the pandemic.”

Biden told a press conference on Monday that he would consider reducing eligibility requirements for direct payments if that meant Senate Republicans would support the proposal.

“Because it was bipartisan, I thought it would increase the prospects for passing – the additional $ 1,400 in direct cash payment to people,” Biden said, adding he was “open to negotiating” aspects of proposal.

On Tuesday, Senate Majority Leader Chuck Schumer said Democrats could move forward on Biden’s proposal without negotiating with the GOP. Schumer told Democrats on a conference call that a vote on a budget resolution “could take place as early as next week.”

Schumer can use a tool called budget reconciliation that would allow Biden’s proposal to go through the Senate by simple majority instead of the normal 60 votes required for approval. The reconciliation would also limit the time lawmakers could debate the proposal to 8 p.m., bypassing any attempts to obstruct it.

“We can do a lot of the COVID bill with reconciliation,” Schumer told MSNBC on Monday, “and that’s something we will definitely use if they try to block this immediate COVID bill.”