The third stimulus check proved to be the last of the direct stimulus payments that the Biden administration could send out to individuals and families across the US. But data shows that the culmination of the pandemic relief coincided with a sharp surge in the figures of individuals and families finding it difficult to survive.
The end of the extended unemployment checks and the enhanced child tax accredit stimulus checks marked the end of the last stimulus checks that were directly being sent by the federal administration.
But after the boom of the last two quarters of 2021, citizens are back to the harrowing days of 2021. The economic downturn triggered by the pandemic had decimated the American economy and only the successive stimulus checks managed to stave off all round starvation.
Data released by the US Census Bureau reveals that roughly 4 out of 10 Americans are facing difficulty in paying bills. This is a sharp increase of 50% over last spring’s figures.
With increased suffering, mainly among the low and moderate-income groups, policymakers in Washington have moved towards austerity measures and have decided upon inflicting more pain on its citizens to first tame the inflation devil.
Federal Move To Stop Stimulus Check Ignores The Fact That Corporate Greed And Supply Issues Are Major To Blame
But data suggests that it is not consumer spending, wages, or the stimulus check which is to blame. The major blame goes to supply and production chain disruption that started with the lockdown during the pandemic. The other major reason is corporate profiteering where the suffering of the people is directly proportional to the profits that corporates are making, especially in the oil and food industry.
The successive stimulus check proved that the President should focus on his priorities, like canceling student debt and expanding Social Security. The stimulus checks and the unemployment and child tax credit payments proved that direct aid virtually immediately improves the economic prospects of Americans.
Americans who faced acute financial troubles substantially went down in the first two quarters of 2021. The third stimulus check, the economic impact payments followed by the $300 per week federal unemployment assistance, sent out stimulus checks for a total of $2,000. The child tax credit also provides parents with a steady monthly payment of between $250 and $300, depending on the age of the child.
The End Of Federal Stimulus Checks And Other Benefits
These payments helped out Americans through 2021 when the CTC stimulus checks ended.
The federal aid has concluded for now. But despite the brief economic boom witnessed in the third and fourth quarters of 2022, the inflation rate started picking up steadily. It reached record figures by the start of 2022 and has maintained that high level ever since.
The inflation is the highest witnessed in the last 4 decades and the worst sufferers were the low and moderate-income groups who live pay check-to-pay check.
Americans experiencing acute financial distress jumped to double l figures and touched 13% in May and June 2022. This is the highest figure in recent times. This round increase in financial distress has been traced to the abrupt stopping of all federal financial programs.
All Federal Financial Support Including CTC Stimulus Check Allowed To Lapse With End Of 2021
The Republican states were the first to initiate the move by cutting off unemployment support benefits way back in the spring of 2021. Congress too allowed the enhanced unemployment payments to lapse in September 2021. The only support that remained to last people the final 6 months of 2021 was the monthly child tax credit stimulus checks.
Matters continue to worsen in recent weeks and the pace is increasing. Inflation has only accelerated since the end of federal aid. Most Americans are facing record-high inflation which is around 8.5% and people have to contend with a record increase in the price of essential goods.
The Situation Has Worsened Since
The federal answer to the high inflation is raising interest. This move will put downward stress on wages. This will lead to job redundancy, reduction of the bargaining power of workers, and making worse the already precarious housing emergency.
Financial hardship is expected to worsen thanks to a prolonged period of inaction by Congress, which has been acting purely along partisan lines without considering the best interest of the most marginalized groups in society.
The Republican opposition is in control of the Senate and has put paid to every progressive measure proposed by the President, beginning with the third stimulus check.
There are more woes for the low-income groups of citizens as there will be a spike in the premium of individual health insurance plans. This is sure to happen if the Democrats do not extend the backings they pushed through last year.
In the absence of an extension, health policyholders can expect a notice of extension of insurance premiums as early as October this year. The midterm election is slated for November 2022.
End Of The Public Health Emergency Could Signal The End Of Medicaid Coverage
The federal administration is expected to end the health emergency that was declared by the Biden government when the COVID-19 pandemic hit America in the first quarter of 2020. This could happen in October and lead to the loss of Medicaid coverage for 14M Americans.
The states too will be encouraged to begin cutting off coverage from their Medicaid roll. The right-wing Bloomberg News in its home editorial has called on the federal administration to declare a date by which the public health emergency could be brought to an end. This will enable the states to cut back on their Medicaid support to their residents.
It indicated that its idea of normality was cutting back on these emergency measures during a period when people need them the most. Ending these emergency measures is the worst possible thing that the federal administration can do under the present economic circumstances.
State Stimulus Check Remain The Only Option At Present
With the federal administration struck in a gridlock of intrigues in Washington, only the states can move in quickly to help out residents from the record inflation figures and the corresponding price rise in America.
Maine, New Mexico, and Virginia are among the states that have declared one-off payments to a section of their residents depending on their income. They have been aided by a generous allocation of funds under the American Rescue Plan signed by President Biden. There are also the beneficiaries of a boom in the economy in the last two quarters of 2021.