When austerity-minded politicians of both major parties run out of arguments for refusing to fund human needs, they inevitably default to the line, “You can’t just throw money at the problem.”
They’re wrong. Savvy economists have recognized for a long time that one of the best things to do during a time of crisis is to get money, lots of it, to people who are suffering. That’s why the Coronavirus Aid, Relief, and Economic Security Act that was approved in March included direct payments to Americans of up to $1,200 for individuals, $2,400 for couples, and $500 per child under age 17. And that’s why 60 grassroots groups—including People’s Action, Public Citizen, Center for Popular Democracy Action, MoveOn, Indivisible, and the Working Families Party—last week argued, “Congress cannot continue to ignore the hunger, pain and economic uncertainty that millions of people are facing. People need access to cash to survive the next round of job losses, to pay for rent and food, to keep their families alive. In order to meet the gravity of this crisis, Congress must prioritize direct economic relief that families and workers desperately need right now.”
Progressives in Congress heard the call and ramped up pressure on congressional negotiators who were preparing a coronavirus relief package that did not include direct payments. With a sense of moral and practical urgency sufficient to meet a moment when millions of Americans are struggling to survive, and tens of millions are experiencing hardship and uncertainty, Senator Bernie Sanders, Congressional Progressive Caucus chair Pramila Jayapal, Representative Ro Khanna, and their allies on the left demanded that the stimulus package feature direct payments to working families.
It appears that their efforts worked. The roughly $900 billion coronavirus relief deal that Congress is expected to consider before its holiday recess will include a new round of payments to cash-strapped Americans, along with enhanced unemployment benefits. The Washington Post reported Wednesday afternoon, “The package emerging is expected to include hundreds of billions of dollars in aid for ailing small businesses and jobless Americans; tens of billions of dollars in aid for other critical needs, such as vaccine distribution and schools; and a one-time check of between $600 and $700 for millions of Americans below a certain income threshold.”
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That’s less than what progressives have been demanding. But it’s an acknowledgement of the need for direct payments—and a critical starting point for demanding more.
While much of the media is portraying this development as the product of 11th-hour discussions between Senate majority leader Mitch McConnell, Senate minority leader Chuck Schumer, House Speaker Nancy Pelosi, and House minority leader Kevin McCarthy, the reality is that direct payments wouldn’t be part of the package if progressives hadn’t played hardball.
McConnell, in particular, was unenthusiastic about proposals to steer money to working families. The majority leader wanted a stimulus package focused on aiding business, and it looked for a time like he would get it. The $748 billion proposal that a bipartisan working group released at the start of the week included no plan for sending checks to Americans.
Progressives looked at the proposal and cried foul. Sanders was especially ardent:
As a result of the pandemic, tens of millions of Americans are facing economic desperation. They can’t afford to pay their rent and face eviction, they can’t afford to go to the doctor, they can’t afford to feed their children and they are going deeper and deeper into debt.
Congress cannot go home for the Christmas holidays until we pass legislation which provides a $1,200 direct payment to working class adults, $2,400 for couples, and a $500 payment to their children.
This is what Democrats and Republicans did unanimously in March through the CARES Act. This is what we have to do today.
Blunt statements came from House members, such as Minnesota Democrat Ilhan Omar, who asked, “Why is it that whenever it is down to last minute negotiations the people that are being compromised are the ones that are hardest hit?” Her answer: “Americans need direct cash payments to be able to feed their children. That shouldn’t be up for negotiation. And I won’t vote for it.”
Jayapal announced, “The Progressive Caucus is united in our position: any COVID relief package must include survival checks and enhanced unemployment assistance—the two most effective ways to put money directly in people’s pockets.”
The Seattle Democrat and leading members of the caucus backed that message up with a letter to leadership that explained:
We know that direct cash payments provide real economic support for individuals and families, and they put this money right back into the economy. Studies on the impact of the CARES Economic Impact Payments showed that within the first 10 days, households spent an average of 29 cents from every dollar received, and that the majority of their spending went towards paying for basic necessities, such as food, rent, and bills. This was especially the case for low-income individuals and households. A relief package should include direct payments of at least $2,000 for all working individuals and families.
In contrast, the letter noted, the payments to businesses favored by McConnell and many moderate Democrats “had far less of a targeted impact due to the inefficiencies of the program.”
The call for direct payments was amplified by leading progressives in Congress, such as Representative Barbara Lee (D-Calif.), who tweeted, “Stimulus checks can’t wait.”
Referencing McConnell’s scheming to protect multinational corporations from accountability for harming workers, former Progressive Caucus cochair Mark Pocan of Wisconsin declared, “The American people don’t need liability shields for crooked corporations. They need survival checks NOW.”
It’s clear: Congressional leaders and the groups of bipartisan negotiators crafting a deal felt the pressure and didn’t want a revolt against the relief package that highlighted its many inadequacies. So they started to move.
But they haven’t moved enough. As Khanna, the California Democrat who has been the House’s leading advocate for direct payments, says, “Any deal must have a survival check and expanded UI. But a single $600 check will not cover the last 8 months of rent. We need to also keep pushing for $2000 monthly checks until the crisis ends.”
With Ohio Democrat Tim Ryan, Khanna has for months worked to enact the Emergency Money for the People Act, a plan the pair cosponsored to provide a $2,000 monthly payment to every qualifying American over the age of 16 for up to 12 months. “Americans need sustained cash infusions for the duration of this crisis in order to come out on the other side alive, healthy, and ready to get back to work.”
Khanna calls the progress that’s been made “a step in the right direction,” adding, “We now have the benchmark that any future Covid deal has to have direct payments.” It’s the only way, he says, “to truly support the American working class.”
In this crisis moment, direct payments make economic, social, and political sense—because there are times when the right solution to a problem is, in fact, to throw money at it.