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The proposal includes a new round of $1,400 direct payments for Americans

By Virginia Chamlee
January 15, 2021 07:56 PM
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Joe Biden
President-elect Joe Biden
| Credit: JIM WATSON/AFP via Getty

President-elect Joe Biden unveiled a proposed stimulus package in light of the ongoing novel coronavirus (COVID-19) pandemic on Thursday.

The $1.9 trillion proposal aims to combat the economic downturn brought on by the virus and would include $350 billion in state and local aid, $1,400 direct payments to Americans, expanded unemployment benefits and institute a higher federal minimum wage.

In a speech delivered Thursday in which Biden outlined his American Rescue Plan, the president-elect signaled optimism that it would ultimately pass after he takes office.

"I'm convinced we are ready to get this done," Biden said. "The very health of our nation is at stake."

Here's more about what the package includes and how lawmakers have responded to the proposal.

Direct Payments

The plan's inclusion of $1,400 in direct payments (which would go to those making below a certain wage threshold) comes in addition to the $600 payments approved by Congress in December, though Democrats have argued that amount still isn't enough.

Progressive New York Rep. Alexandria Ocasio-Cortez told The Washington Post that lawmakers should pass $2,000 payments on top of the $600 checks from December, rather than add $1,400 to get $600 to reach $2,000.

She said, "$2,000 means $2,000. $2,000 does not mean $1,400."

Enhanced Unemployment Benefits

Biden's plan would increase federal jobless benefits from $300 (passed by Congress in December) to $400 per week.

The package would also extend two unemployment programs that were created with the first stimulus package, known as the CARES Act: The Pandemic Unemployment Assistance program — which expands jobless benefits to freelancers workers, independent contractors and the self-employed — and the Pandemic Emergency Unemployment Compensation program — which provides 13 weeks of additional payments to those who exhaust their regular federal or state benefits.

As CNBC reports, the new stimulus package would also phase out unemployment benefits over time and according to economic and health conditions. That would mean Congress would no longer have to resort to drafting new relief measures every few months, as they have been doing since the pandemic began last year.

The plan would also reinstate paid sick and family leave benefits for workers, which expired at the end of December. 

Aid to States and Funds for Vaccine Deployment

The Biden package would provide $350 billion to state and local governments to keep frontline workers employed, and to better distribute the vaccine. That money would also go toward increasing testing and reopening schools.

An additional $160 billion would go toward a national vaccination program. Biden has previously pledged 100 million vaccinations in his first 100 days in office. 

Rental Assistance

As outlined, the American Rescue Plan would also provide $25 billion in rental assistance for low- and moderate-income households who lost their jobs due to the pandemic. Those funds would be in addition to the $25 billion set aside by lawmakers in a December stimulus package signed into law by President Donald Trump.

Biden's plan would also extend the federal moratorium on evictions, which is set to expire at the end of this month, until the end of September.

The plan also includes $5 billion to be put toward helping renters pay their utility bills, while an additional $5 billion would be set aside for states to assist those struggling to pay their bills.

A New Minimum Wage

In his remarks delivered Thursday, Biden also called on Congress to raise the minimum wage to $15 an hour and to end the tipped minimum wage and the sub-minimum wage for those with disabilities.

"There should be a national minimum wage at $15 an hour," Biden said. "No one working 40 hours a week should live below the poverty line."

Criticism

Republicans were swift to criticize Biden's proposal, with Texas Rep. Kevin Brady, the lead conservative on the House Ways & Means Committee, calling it an "economic blind buffalo" that doesn't do enough for small businesses.

Florida Sen. Rick Scott also blasted the measure in a statement released after Biden's speech.

"We cannot simply throw massive spending at this with no accountability to the current and future American taxpayer," Scott said.

The $15 minimum wage is expected to be an especially controversial provision, as other attempts to raise the wage have been historically unsuccessful due to resistance from members of the GOP.