Fourth stimulus test unlikely as federal government grapples with omicron

New Yorkers lined up to be tested for Covid-19 in Times Square on December 26, 2021, as the omicron variant continues to spread.

Andrew Kelly | Reuters

Omicron is causing more disturbances to the US economy.

That could prompt Washington lawmakers to reconsider previous relief strategies during the Covid-19 pandemic.

Ed Mills, Washington policy analyst at Raymond James, said the conversations on Capitol Hill were directed at possible support for small businesses, restaurants, gyms and performance venues that are affected. hardest hit by this new wave.

“The conversation hasn’t expanded to support individuals yet,” Mills said. “But it went from something that wasn’t going to happen to something we had to see.”

The US hit a single-day record for the number of Covid cases this week, with more than 1 million new infections reported.

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However, some federal relief measures to help individuals and families — namely the expanded unemployment benefits and three stimulus test suites — are no longer in effect.

This time around, lawmakers may not reconsider similar strategies.

Why: The pandemic has changed, and so has the US economy.

While the early days of the pandemic were marked by high unemployment and record layoffs, that has now turned in favor of workers.

“With millions of job openings yet to be filled, Congress would be hesitant to provide something that would otherwise be seen as discouraging to fill those positions,” Mills said.

However, that does not mean there is no help.

According to Dave Kamper, senior State policy coordinator at the Economic Policy Institute, states and localities are still spending $90 billion from the American Rescue Plan Act that passed last year.

They expect to raise an additional $150 billion later this spring. Schools have received $120 billion, much of which may not have been spent, he added.

“We are not going to fix this pandemic because the ARPA money is in the bank account,” said Kamper. “We’re going to fix the pandemic by the way the ARPA money is spent, and there are lots of good ways to spend it.”

One way states can help is by providing sick leave and paid leave to workers once federal measures have lapsed. While some states like New York do this, more states could add these programs to help ease the burden of the pandemic, Kamper said.

The provision of paid leave, he said, could help inspire more workers who are unable to take time off work to get vaccinated.

States could also create one-time payments to residents — as an incentive to get vaccinated or as a paid time off to get vaccinated, he said.

They could also move to bolstering unemployment insurance, though large-scale efforts still need to be handled by the federal government, Kamper said.

On Capitol Hill, more aid to individuals could have been made possible through the proposed extension of the expanded child tax credit.

Eligible families received monthly payments of up to $300 per child in 2021. Final payments were rolled out in December and will not continue unless Congress passes Congress. through the Better Rebuilding Act.

Democrats are hoping to pass that bill through a simple majority known as conciliation. But those efforts have stalled. Senator Joe Manchin, a Democrat from West Virginia, said he would like to see the extended credit have stricter targeting requirements.

“The conversation about individuals really begins with what to do with the child tax credit,” says Mills.


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