Millions of Americans are struggling to stretch the checks they've already received. "Families who receive stimulus payments spend them overwhelmingly on necessities like food," as well as rent, mortgage payments, and utility bills, according to a new analysis of U.S. Census Bureau data from the nonprofit Economic Security Project, which calls stimulus checks "critical relief" that should continue.
The same analysis found that stimulus checks have been the "fastest, most impactful investment helping Americans get through this crisis, lifting more people out of poverty than any other crisis."
Approval of additional direct payments would benefit millions: "A fourth and fifth check could keep an additional 12 million people out of poverty," according to the Economic Security Project.
Lawmakers were hoping President Joe Biden would include recurring direct payments to Americans in his economy and infrastructure–focused Build Back Better Plan. At the end of March, Senate Finance Committee Chairman Ron Wyden (D-OR) and 20 other Senate Democrats told the president the latest $1,400 wasn't enough: "A single direct payment will not last long for most families," they wrote.
Biden hasn't publicly revealed his position on a fourth stimulus check or recurring direct payments. He is however reportedly working on another stimulus package that could bring financial relief to Americans.
Here's what's in the works and how it could impact you.
What's in the American Families Plan: Child-care funding, paid leave, and more
Biden is set to follow his Build Back Better Plan with a package known as the American Families Plan, CNBC reports. The White House could unveil the plan to Congress on April 28, according to The Washington Post.
The details of the American Families Plan are still being worked out, but it's expected to expand child care funding, and dedicate funds to paid family and medical leave, per CNBC.
The plan would reportedly invest billions in programs including universal pre-K education, tuition-free community college, money for nutritional assistance, and provide tax credits for families, while raising taxes on the wealthy.
Video by Stephen Parkhurst
The American Families Plan would extend the enhanced Child Tax Credit through 2025. The Child Tax Credit was increased in March as part of the American Rescue Plan to as much as $3,600 per child per year but is set to expire in 2022.
Investing in American families this way could be even more beneficial than direct checks, says Peter Earle, an economist at the American Institute for Economic Research. "More lasting growth, and a foundation for continued gains in wages, employment, and other factors would be policies that target not more consumption but investment," he says.
Still, such investments in child care, education, and family leave wouldn't be as instantly gratifying as receiving a check in the mail. That's part of the reason it's harder for lawmakers to drum up voter support for infrastructure programs, Earle explains. "Policies targeting investment don't have the 'marketing value,' and are more abstract, than simply mailing a check to a possible voter," he says.
But seeing as there was unanimous opposition by Republicans for the American Rescue Plan, it's unclear if another round of stimulus checks would make it through Congress.
More from Grow: