Biden’s Covid stimulus plan: It costs $2tn but what’s in it?

Covid: The US is poised to pass its third major spending package of the pandemic a $1.9tn plan. That President Joe Biden has maintained as a way to help struggling Americans. Moreover, leaders of his Democratic Party, which has a slight majority in Congress and are planning to pass the so-called American Rescue Plan by the end of the month.

While Republicans say, the plan is without reason large and stuffed with Democratic priorities unrelated to the pandemic. However, Mr Biden and his team maintain the US must “act big” and that the extra cash is being spent on. Those most affected by the crisis – the poor, minorities, and women.

Direct payments – $422bn

Generally, the plan calls on the government to send out $1,400 per person. Moreover, with the payments phasing out for those with higher incomes – at $75,000 for a single person and couples making more than $1,50,000.

However, this will be the third stimulus cheque since the pandemic. The US approved $1,200 cheques last spring and another $600 in late December. On the other hand, the promoter sees the payments as critical financial support for families. Many of which have seen incomes drop, even if they have not lost work entirely. However, opponents say the measure is overly broad.

Additional jobless assistance – $246bn

The bill provides money to extend jobless benefits until the end of August. That’s a critical respite for more than 11 million long-term unemployed. 

Whose eligibility for benefits is currently due to expire in mid-March. The plan also boosts the weekly amount received by workers through state unemployment programmes by $400.

Support for Parents – $120bn

Democrats expect to give parents of children under the worth of America’s existing. The child tax credit from $2,000 annually to as much as $3,600, and making the benefits available in advance.

Moreover, the bill also increases how much parents – many of whom have been changing extra childcare duties. Due to school finish – may reclaim from their annual tax bill for childcare prices.

Money for Covid-19 Tests and Vaccines – $70bn

Mr Biden has called for allocating $50bn to improve testing centres and another $20bn to develop a national vaccination campaign. Including setting up community centres and hiring new workers to administer the shots.

Meanwhile, we cannot be saving our economy without first containing the virus, Democrats said as they advanced the plans.

School Reopening Funds – $170bn

The bill sends $170bn to schools and universities to help them take steps to reopen. Like buying masks and cleaning supplies, upgrading ventilation systems and creating smaller class sizes.

However, Mr Biden has made reopening a top priority, responding to studies that show students with remote schooling falling behind. It’s also seen as a factor preventing parents from returning to work.

Business Support – $110bn

The bill includes grants for small businesses as well as more targeted funds. These are $25bn for restaurants and bars, $15bn for airlines and another $8bn for airports, $30bn for transit, $1.5bn for Amtrak and $3bn for aerospace manufacturing.

Funds for Local Governments – $350bn

Different, former motivation packages, this one provides money for local governments. Many of which are facing higher expenses and lower revenues due to the economic downturn.

However, Republicans have struggled with it as a handout to primarily Democratic states, noting research that shows. That the budget situation in many states is better than expected. California even has a surprise surplus.

On the other hand, the Democratic plan would send at least $500m to every state, with additional funds rule by the number of jobless workers. Cities and countries, tribes and territories are also in line for money.

Paid Leave and Health Insurance Help – $55bn

The plan returns the requirement – which expired at the end of 2020 that employers offer paid sick leave. The staff who contract Covid-19, are exposed to the virus and must quarantine or are caring for sick family members. 

Moreover, the provision is estimated to cost the government, which reimburses most employers for those costs, about $8.8m. And it also aims to make it easier for more people to buy health insurance independently, with credits worth an estimated $46bn.

$15 Minimum Wage

The plan includes supply to increase the national minimum wage to $15 per hour by 2025, more than doubling the current rate. It also requires that employers pay the full amount to workers that have been relieved in the past. Such as those like restaurant servers receiving tips.

The move estimated to boost the wages of some 27 million people, is among the most controversial elements of the plan. Republicans say it will cost jobs, pointing to a study by the Congressional Budget Office which said the move could put 1.4 million positions at risk. The CBO also said the increase could lift 90,000 people out of poverty.

In the Senate, some moderate Democrats have also voiced concerns. Even Mr Biden has expressed doubts the wage hike will make it into the final version of the package.

So will it pass?

Congressional Republicans are lining up to oppose the entire Covid-19 relief bill. Even though there has been little organised national effort to turn public opinion against it.

Moreover, conservatives will object to the $1.9tn price tag as too high given the skyrocketing. US national debt and then specifically focus on more controversial items like the minimum wage increase and payments to Democratic-controlled states and cities.

Ultimately, there may be a few Republicans who break ranks and carefully support. The bill rather than be seen opposing the legislation’s popular measures.