Reps. Gomez and Moore Lead Ways and Means Democrats in Calling on President Biden to Enact Recurring Direct Payments and Unemployment Benefits in Economic Crises
Washington, May 17, 2021
Tags: Economy and Jobs
WASHINGTON, D.C. – Today, Congressman Jimmy Gomez (CA-34) and Congresswoman Gwen Moore (WI-04) led five of their Ways and Means Committee colleagues in asking President Biden to include recurring direct payments and automatic unemployment insurance (UI) in his American Families Plan.
In response to the President’s support for automatically adjusting the length and amount of UI benefits unemployed workers received depending on economic conditions, the lawmakers are calling on the White House to back a plan that would issue recurring direct payments and unemployment insurance should a similar crisis hit our nation in the future. Recurring direct payments have broad, bipartisan support from both the general public and economic experts, and stimulus checks issued through the CARES Act, the year-end spending bill, and the American Rescue Plan Act, along with enhanced federal UI benefits, proved to be the most effective, but temporary, forms of direct relief during the COVID-19 pandemic.
“The success of the American Rescue Plan, combined with direct financial assistance in the CARES Act and prior federal legislation, is evident in communities nationwide,” said Congressman Gomez. “But we can’t pretend that a $1,400 check will be enough to last a year, and we need to be prepared with a strengthened safety net should a similar economic crisis strike again. Tying recurring direct cash payments and federal unemployment benefits to the country’s economic conditions not only makes sense, but it also shows the American people that their government is prepared to help them in the event of another economic catastrophe. I look forward to working with President Biden to ensure we can deliver these two critical economic recovery tools to uplift all American workers and their families.”
“Survival checks and unemployed benefits reduced the misery index during this pandemic, but families are still feeling its impact,” said Congresswoman Moore. “Tying these benefits to economic conditions, rather than arbitrary political timelines, would help us maintain relief for Americans still struggling with how to keep their kids fed, pay bills, and keep a roof over their heads, lifting up Americans and help create a truly equitable economic recovery.”
As the lawmakers noted in the letter, $1,400 checks issued in the American Rescue Plan Act will keep 11 million people out of poverty this year, while a fourth and fifth stimulus check could keep an additional 12 million Americans out of poverty. Additionally, 67 percent of adults reported that the most recent stimulus check was important to their financial well-being, but 60 percent also reported that those checks will last them less than three months.
Congressman Gomez is also a cosponsor of the Emergency Money for the People Act, which would send monthly $2,000 checks to most Americans retroactive to March 2020 and through the remainder of this economic crisis.
The following Members of Congress signed onto the letter: Donald S. Beyer, Jr. (VA-08), Earl Blumenauer (OR-03), Judy Chu (CA-27), Jimmy Panetta (CA-20), and Bradley S. Schneider (IL-10).
For a PDF of the letter, please click here.
The text of the letter can be found below.
Dear President Biden:
Thank you for your steadfast and decisive leadership during the ongoing public health and economic crisis. The American Rescue Plan (ARP) has provided much-needed relief to millions of Americans. Direct payments and enhanced unemployment insurance (UI) in particular have served as lifelines to families and workers that have had their lives upended by the pandemic. As we continue to Build Back Better, it is imperative that we work to ensure this critical relief remains available when they need it most.
In the American Families Plan, you pledged “to work with Congress to automatically adjust the length and amount of UI benefits unemployed workers receive depending on economic conditions.” We welcome this opportunity but urge you to prioritize both automatic UI extensions and recurring direct payments tied to economic conditions. The pandemic has served as a stark reminder that families and workers need certainty in a crisis. They deserve to know they can put food on the table and keep a roof over their heads. They should not be at the mercy of constantly shifting legislative timelines and ad hoc solutions.
Direct payments and enhanced UI are among the most effective forms of relief available. Not only do they help keep families and workers out of poverty, they act as economic stimulus by increasing spending and supporting jobs. iii When the CARES Act relief checks ran out, poverty rose, and many families and workers experienced spiraling debt. Automatic stabilizers will give families and workers certainty that relief is coming. Families and workers shouldn’t have to worry about whether they’ll have enough money to pay for essentials in the months ahead as the country continues to fight a global pandemic and recession. Two-thirds of adults reported that the third stimulus check was important to their financial well-being. But nearly as many – six in ten – reported that the checks will last less than three months, which is virtually unchanged from January. Most people spent relief checks on monthly expenses or essentials such as food, utilities, rent, and mortgage payments.
The two forms of payments also work in tandem. While UI replaces lost income for those out of work, direct payments are crucial for supporting struggling families that fall out of its reach. This includes the millions of workers that do not qualify for UI after having their hours reduced, switching to lower-paying jobs, or temporarily leaving the workforce to care for family members. The ARP’s $1,400 checks alone will keep 11 million people out of poverty this year, with UI expansion and other provisions in the bill accounting for the another five million. vi A fourth and fifth check could keep an additional 12 million out of poverty. Combined with the effects of the ARP, direct payments could reduce the number in poverty in 2021 from 44 million to 16 million.
Recurring direct payments have wide support from both the general public and economic experts. Polling shows 65 percent of Americans support recurring cash payments “for the duration of the pandemic.” This includes support from 54 percent of Republicans and 60 percent of independents. Economists support the idea too. More than 150 economists recently wrote an open letter supporting automatic stabilizers as part of a strong recovery and warning against repeating the mistakes of the Great Recession, when an insufficient response led to unnecessary suffering, particularly among low-income workers.
In your joint address to Congress, you laid out a vision to turn crisis into opportunity. Tying recurring direct payments and automatic UI extensions to economic conditions would do just that. We urge you to include both in the American Families Plan and are ready to work with enact this critical relief into law.