Thursday, June 11, 2020
Are Second Stimulus Checks Unlikely After Strong Jobs Report in May? #MMBCovid
After an unexpectedly positive jobs report for the month of May, Americans are wondering if a second round of stimulus relief is less likely than ever.
The country has felt the financial impacts of the COVID-19 pandemic since March, with business shutdowns causing unprecedented layoffs and a round of financial relief in the form of the CARES Act.
The bill, passed in late March, gave qualified taxpayers $1,200 stimulus checks and qualified jobless workers an extra $600 a week in unemployment insurance benefits.
On Friday, data from the Labor Department revealed an unexpected rise in jobs in May, suggesting that the weeks-long economic drag caused by the coronavirus pandemic is slowing down.
The data showed that employment rose by 2.5 million last month, bringing the jobless rate down to 13.3%, from 14.7% in April.
What second round of relief has been proposed?
In May, House Democrats narrowly passed the HEROES Act, an extensive 1,800-page bill that would offer a second round of checks to the tune of $1,200 per person and up to $6,000 per family.
The bill also proposed an extension of the $600 weekly federal unemployment payment until January. The benefit as granted via the CARES Act is currently slated to end in July.
Senate Majority Leader Mitch McConnell has voiced strong opposition to the HEROES Act. Republicans hold a majority in the Senate and have been put off by the size of the bill.
“We have not yet felt the urgency of acting immediately. That time could develop, but I don’t think it has yet,” McConnell told reporters in May.
Last month, President Trump also expressed he would veto the bill if it would pass, adding that funding is "going to happen in a much better way.”
What are officials saying after the May jobs report?
According to officials in Washington, the jobs report makes the already-tenuous second round of aid even more unlikely.
Washington Post reports that Stephen Moore, an economic adviser to the White House, has said in interviews that a new relief bill is unnecessary in light of the uptick in jobs from May.
“It takes a lot of the wind out of the sails of any phase 4”, Moore said. “We don’t need it now. There’s no reason to have a major spending bill. The sense of urgent crisis is very greatly dissipated by the report.”
McConnell echoed the sentiments in a statement released after the job report.
“As Senate Republicans have made clear for weeks, future efforts must be laser-focused on helping schools reopen safely in the fall, helping American workers continue to get back on the job, and helping employers reopen and grow,” the Senate majority leader said.
Some economists fear that prematurely ending federal aid could stymie the country’s economic recovery in the wake of coronavirus.
“This is … like stopping an antibiotic prematurely because you start to feel better,” Ernie Tedeschi, an economist who served in the Obama administration, told Washington Post. “If we let support expire too soon, we could have a double-dip downturn.”
Posted by Mix Masta B at Thursday, June 11, 2020