The US stimulus bill is set to grow once the Biden era begins on Thursday.
On tap is another $1.9 trillion injection into the US economy, adding to the $3 trillion package passed earlier in the pandemic and the ‘scaled back’ $900 billion package agreed to in December.
The plan will provide an additional payment of $1,400 to those who made up to $75,000 last year, supplementing the $600 monthly payment implemented last month, accounting for some $465 billion in new federal spending. Another $350 billion will go toward extending emergency jobless benefits of $400 per week.
The plan also earmarks $350 billion in fiscal relief for local governments that are deeply in the red and at risk of laying off thousands of public sector workers. Some 1.4 million local government workers have lost their job since the pandemic hit – a significantly higher rate than the layoffs that followed the Great Recession (721,000 public sector jobs were lost between 2009-2015).
It also allocates funds for: school and university re-openings ($170 billion); vaccination and testing delivery ($160 billion); additional child tax credits ($120 billion); $50 billion in grants and loans for small businesses; and $200 billion in other miscellaneous programs.
Notably absent are Biden’s other policy priorities such as infrastructure spending and promoting a transition toward renewable energy sources. These are expected to be introduced in another stimulus package that will be rolled out at a later date. Surprise Democratic victories in both Georgia Senate races earlier this month put the Biden infrastructure package back in play. Biden campaigned on implementing what would be the largest state-driven infrastructure programs since World War II, aimed at building new roads, water systems, bridges, transit networks, ports, etc. – and creating millions of jobs in the process. The plan was originally priced at $2 trillion, which is expected to be funded by new taxes on corporations and high earners.
Getting stimulus through the Senate
Proposals from the Biden administration must make it through the Senate to be realized, and though the Democrats now enjoy the narrowest of majorities following the Georgia results, there are still two hurdles that need to be cleared: a potential filibuster by Republicans, which increases the passage threshold to 60 votes, and skeptical members of their own caucus such as West Virginia Senator Joe Manchin (Manchin is keen on infrastructure spending; not so much on green investment).
