The American Rescue Plan and Economic Reovery
The American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package or American Rescue Plan, is a $1.9 trillion economic stimulus bill passed by the 117th United States Congress.
Stimulus checks have helped millions of Americans survive during the pandemic.
The economy is now recovering, though that recovery remains somewhat uneven. The financial situations of many people haven’t improved. Unemployment still exceeds pre-pandemic levels, and millions of jobs have not returned.
The third round of relief payments started over three months ago, courtesy of the American Rescue Plan (ARP). Since then, approximately 169 million people have received up to $1,400 each, totaling $395 billion of the $422 billion set aside. That includes the 2.3 million checks and plus-up payments sent as recently as a couple weeks ago.
The ARP checks followed closely behind the $600 payments from January, which came nine months after the $1,200 payments from the pandemic’s early days.
The Economic Recovery Is Very Uneven
Financial insecurity is still widespread, with 38 percent of respondents to a first-quarter TransUnion survey saying their current income fell short of their pre-pandemic income.
The loss of a job and the loss of hours were the main reasons. Ten percent of American adults (approximately 20 million people) reported a shortage of food in their household over the previous week, according to U.S. Census survey data from late May and early June. Approximately 14 percent of renters (10.5 million people) have fallen behind on their rent, including 21 percent of renters with children in their household.
The federal eviction moratorium, set to expire on June 30, doesn’t forgive rent owed, it pushes the debt into the future. So a tidal wave of evictions may be coming soon. Millions are also struggling to pay their mortgage.
As of early June, over a quarter of American adults (63 million people) reported some difficulty keeping up with expenses in the prior week.
A survey from the Federal Reserve Bank of New York determined that over 58 percent of those receiving a third stimulus check have or will use the money on consumption or paying down debt. That includes debt incurred during the pandemic.
A Bloomberg/Morning Consult poll from last February listed food and housing costs as the second and third most popular uses of the then-upcoming stimulus.
Employment Remains A Problem
Employment also remains well below pre-pandemic levels.
The unemployment rate fell to 5.8 percent in May, but about 7.6 million fewer people are employed today as compared to early 2020.
Most of them were in low-wage jobs lost during the pandemic that have not returned.
Approximately 411,000 people initially applied for unemployment insurance last week. (A typical pre-pandemic week saw about 250,000 new unemployment applications.)
Another 105,000 people sought Pandemic Unemployment Assistance (PUA), which supports freelance and self-employed workers. As of the week ending June 5, almost 15 million workers were receiving some form of unemployment aid.
Many jobless Americans have not received unemployment insurance and other government benefits, because of long waits, perceived ineligibility and other issues.
What Program Means The Most To You?
The American Rescue Plan makes health insurance more affordable for millions of Americans.
A Kaiser Family Foundation analysis estimates that 92% of people who buy their own health insurance will qualify for a subsidy. Its findings also indicate that 1.4 million uninsured people are now newly eligible for the subsidized marketplace coverage.
Kaiser pegs the average savings as ranging from $33 a month for those with incomes under 150% of the poverty level to $213 a month for those with incomes between 400% and 600% of the federal poverty level.
Estimates by the Centers for Medicare & Medicaid Services (CMS) say premiums after the new savings will decrease, on average, by $50 per person per month, or $85 per policy per month. Four out of five enrollees should be able find a plan for $10 or less a month after premium tax credits, CMS says, and more than 50% will be able to find a “Silver” (or mid-level) plan for $10 or less.
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