Written December 14, 2020

After negotiating for months amidst a pandemic viciously spreading across the country, Congress stalled on development of a 2nd major stimulus package to help the struggling American economy recover after a devastating shock in March. Key provisions couldn’t be agreed upon by both parties, with disagreement over the size of the stimulus in dollar numbers as well as where those dollars should go.

While much more work remains to be done on shaping the bill, a startling alliance has emerged—one that argues for real, substantial aid to go directly to American families. It was December 10th, and GOP Senator Josh Hawley was demanding $1200 checks be sent directly to families, a repeat provision from the Coronavirus Aid, Relief, and Economic Security (CARES) Act earlier this year. Hawley was echoing the same commitment made by Sen. Bernie Sanders as he said, “working people and working families should be first on our to-do list, not last.” While a few other Senate Democrats have indicated support for direct checks—Elizabeth Warren, Ed Markey, Ron Wyden, Jeff Merkley, and Kirsten Gillibrand—the legislators fall very far short of the required number to get it passed in the Senate without support from party leadership.

Only time will tell whether Hawley and Sanders will succeed at getting their demands met, but the unlikely pairing’s ambitious stance is the correct one: Congress should be spending more money and should be sending more of it directly to Americans struggling to make it through the end of 2020. It is basically an open secret at this point that the federal government should be injecting much more fiscal stimulus into the economy, and the CARES Act passed in March has proven that direct checks in particular are an amazingly effective provision.

Casual observers might not fully realize the immense spending power the federal government has, a power that most experts believe should be utilized even more than it already is. In addition to the $2 trillion CARES Act, the Federal Reserve pumped $2 trillion more into the economy through quantitative easing, and when asked if Congress should add on a second stimulus of a similar size, Federal Reserve Chairman Jerome Powell said: “Yes, absolutely.”

There’s no doubt the deficit hawks will come out in full force when President-elect Biden takes office, but the “balanced budget” austerity philosophy is not what a majority of Democrats or Republicans truthfully believe in. Actions speak louder than words: massive stimulus spending has been pursued by the Trump-appointed Federal Reserve Chairman, Trump-appointed Treasury Secretary Steve Mnuchin, Senate Majority Leader Mitch McConnell, as well as almost all senators of both parties—the previous $2 trillion stimulus bill was approved with a 96-0 vote.

We truly are all Keynesians now, as Richard Nixon is attributed to have said. Ideological consensus exists among a supermajority of politicians and economists alike in favor of massive stimulus spending, regardless of all the opportunistic debate concerning the national debt. Larry Summers, a top economic adviser to both Clinton and Obama, argued against deficit reduction this year along with a former Fed Chairman, the former chief economist at the International Monetary Fund, and a Harvard economics professor. Add to that list Nobel-Laureate economist Paul Krugman, former Labor Secretary Robert Reich, and AFL-CIO economist William Spriggs: all the way from the leftwing to the rightwing, experts say we should not be worrying about the debt. To find someone opposed to government spending on principle, you’d have to talk to Tea Party libertarians—a bunch of politicians whose movement’s chief architect, Charles Koch, admits totally failed at clamping down on deficit spending.

Though agreement on the fact that fiscal stimulus is critical is an important first step, it also matters where that money is allocated. While methods for direct relief were seen as untested policy tools before this year, it’s not an entirely new idea. A similar scheme was passed in the wake of the Great Recession in 2008. Bush’s Administration oversaw tax rebates, which were sent to millions of people in an attempt to stimulate the economy through injecting huge amounts of disposable income into peoples’ pockets. The difference between Bush’s tax rebate and the 2020 checks is that the latter ended up being much larger: over $218 billion paid out this year, compared to $120 billion in 2008. That’s a lot of money—but nothing compared to the overall price tag of the CARES Act of more than $2 trillion.

Even more funding could be sent directly to households in a new round of checks; and it’s an immensely popular concept with support from a whopping 70% of Americans. Other polls suggest that even more people want a monthly stimulus check rather than a one-time payment. On the other hand, what Congress usually goes for—bills that amount to trillions in corporate bailouts to keep banks and corporations stable—are immensely unpopular with the public. The public wanted assurance that there would be no layoffs before corporations were bailed out, yet unemployment ballooned to almost 15% at the peak of the crisis, the highest point since the Great Depression. One way this could have been avoided were wage subsidies for workers temporarily furloughed due to the coronavirus, something a dozen countries chose to do—excepting the United States.

The bottom line is that we faced an economic disaster of unprecedented proportion, and have not yet weathered its full effects; further, bolder action will be necessary. The CARES Act was significant enough to offset the very worst outcome but can’t be the full extent of the government response. The unemployment rate is still 6.7%, more than double what it was a year ago. There’s been an enormous contraction of GDP, and people are being stretched thin. Inequality has markedly increased. The services industry and others paid the lowest wages are most affected by the pandemic, receiving more layoffs and unsafe working conditions. Meanwhile, the stimulus package gave far more money and tax breaks to millionaires and billionaires than the remaining 90% of Americans. 54 million people in the US are going hungry, an increase of 17 million more people since the coronavirus emerged.

The necessary fiscal response on behalf of the country’s most disadvantaged must be pursued at all costs. We needn’t worry as much about the banks and corporations, who are surely certain to have their interests represented in Congress. It’s everyone else we should be worried about, and the American people deserve far more from the government. 

Other initiatives notwithstanding, the American people ought to receive at minimum another round of $1200 checks, in the words of Bernie Sanders. Sanders and Hawley are leading the line on what shouldn’t be a controversy at all: we should be spending much more on relief for everyday working-class families, and they should be a higher priority than the business sector. It’s not the average worker’s fault that they are starving after becoming homebound because of a virus that has killed over three hundred thousand Americans. And it could not be any further from justice that billionaires have gained over $1 trillion since the pandemic began while others suffer. Millions are at risk of starvation so that Jeff Bezos could double his Forbes net worth. Such a sentence should only be a nightmarish joke, not reality. 

There’s an easy solution, however, if the government is willing. Another stimulus with policies similar to ones that have already been passed would mean the difference between financial solvency and bankruptcy for countless families. It could mean the difference between having a warm bed at night or eviction—having food on the table or going hungry. Less than $300 billion in direct checks (along with expanded unemployment insurance) went a long way, which is nothing compared to the scale of the overall price tags of these bills. Imagine how much good another round of direct payments could do. There’s a moral and practical imperative to bring significantly more aid to millions in need across the nation. The experts say it’s easily feasible, worth the cost, and it’s been done before. Yet currently, most of the Senate and its leadership have not committed to more direct relief for workers. What’s stopping them?

Jaden Lanza ‘23 studies in the College of Arts & Sciences. He can be reached at jadenlanza@wustl.edu.