Many states are dipping into their budget surplus funds or funds from the American Rescue Plan Act to send inflation relief stimulus checks to residents. Americans continue to battle record-high inflation rates that have eaten into their saving and have led to negative growth in real wages despite wage increases across sectors after the pandemic.
While the federal government expected a rise in inflation, they expected things to cool down by the turn of the year in 2021. The inflation rate which has stayed within the 1%-2% mark for years began to creep upward starting in March 2021 when it crossed the 3% mark. It crossed 4.5% in April 2021, doubling within two months and it has been a steady inexorable march northward ever since.
By the end of the first quarter in 2022, it crossed 8.5%, a 4-decade record, going on to cross the 9% mark in June, ending at 9.1%. it is the highest recorded since November 1981.
Wages Not In Sync With Rapid Record Inflation
While rising inflation continues to be a major concern around the world, the situation in the US continues to be way grimmer when seen against comparable economic in Europe and the UK. Wage inflation is unable to keep up and Americans are facing the unpalatable prospect of negative wage growth. While a minority of workers’ wages have remained on par or risen above the level of inflation, most are seeing their purchasing power weakening in 2022.
Workers in high-paid jobs have enjoyed enormous bonuses as industries across sectors try to retain skilled workers. But for the majority, it is a grim tale of negative wage growth, with most workers earning less in real terms than they did before the onset of the pandemic.
It has been reported that the pay of CEO and top management workers has bounced back to reach pre-pandemic levels along with a healthy rise to account for inflation. But for a majority of workers in the low and medium-income groups, higher prices due to inflation are rapidly eroding the real value of their earnings.
Over a quarter of workers are struggling to afford even necessities with gasoline, food, utility rates, and home rents all having risen simultaneously at very high rates. It spells real hardship for most workers as most have spent their savings during the pandemic and are being forced to live paycheck-to-paycheck.
Under such circumstances, the only way to help people out under this period of stagnant wages is to offer direct financial support to the least well-off in society to help with their soaring cost of living. And the only avenue open for most citizens is state support as it is certain at this moment that there are no chances of further stimulus checks at least till the midterms in November.
Things are going to be even further after the midterms as the Republicans are expected to take control of both houses of Congress. The Republicans have been vehemently opposed to the stimulus checks and have blamed the economic impact payments for the record inflation rate.
Even Republicans States Are Giving Out Stimulus Checks Though Their Party Vehemently Has Opposed Any For Of Aid To Workers
But ironically states such as Florida have taken advantage of the ARPA funds given to states to give out stimulus checks on their own. Governor Ron DeSantis, also 2024 presidential hopeful, a staunch opponent of the stimulus check, and a Trump loyalist, has been passionately against stimulus checks for citizens.
But Florida is among the latest states to join the list of states sending out stimulus checks to residents. Around 59,000 families in Florida with kids are set to receive a $450 ‘inflation relief’ check, which is a one-off payment. The payments are being given to offset the impact of a surge in inflation and also to help families with children afford supplies for the coming school year, say, state officials.
To be eligible for the payment, people must meet any one of several requisite qualifications as of July 1. The Dept. of Children and Families in Florida has said that the parent must either be a foster parent or a relative or non-relative caregiver to qualify for the $450 stimulus check.
Also eligible are families that receive cash under the Temporary Assistance for Needy Families scheme, also referred to as welfare. Residents who participate in the Guardianship Assistance Program are also eligible for the payment.
Around $35.5 million has been set aside from the federal fund in Governor DeSantis‘s budget from funds under ARPA. State officials have said that the funds would have reverted to the federal administration if they are not expended by the end of 2024. Beneficiaries will be getting the stimulus checks before the ‘back-to-school’ sales tax holiday announced by the Florida administration between July 25 and August 7, said, officials.
A letter from DeSantis states that the stimulus checks with $450 are being given to offset inflation-related rising costs. This becomes more vital for children as the new school year approaches, the letter further states that Florida is giving out the amount for each child in the care of eligible families.
Other states are providing tax rebates and stimulus checks in other forts to offset the highest inflation in 40 years. The effort by the Florida government is likely to help the neediest families in the state as it is targeting parents with foster kids and those who are on welfare support.
California is another state that is giving inflation relief stimulus checks that could go up to $1,050 for joint income tax filers who earn below $150,000 and have a dependent. It works out to $350 for each eligible member. Only one dependent is eligible under this scheme. For individual filers in this income bracket, the total works out to $700 with $350 each for the filer and one dependent.
Even families jointly earning up to $500,000 are eligible for a stimulus check but the individual amount is down to $200 in this instance. So a family in this income bracket can hope to earn $600 maximum.
Residents of both states do not have to apply for the relief if they have filed their income tax returns for 2021.