As Congress and the Trump administration craft an economic response to the coronavirus (COVID-19) pandemic and resulting economic crisis, it is vital that the package be fast-acting, robust, and provide ongoing support throughout this emergency.
The federal government has an important role in providing and funding support for Oregonians struggling to afford food for their families and rent to keep a roof over their heads. Passing the Families First Coronavirus Response Act was a critical first step in getting us through this crisis. Even more needs to be done to boost vital programs like the Supplemental Nutrition Assistance Program (SNAP), Unemployment Insurance, and rent assistance.
However, Congress should go further by enacting direct payments to families throughout our nation. Currently, Congress is considering multiple competing proposals that would put checks in the pocketbooks of Americans. These proposals range from $1,000 one-time checks to all adult Americans, to an ongoing cash payment that could give some families up to $18,000 over the course of the year. Any recovery package should abide by the following principles.
Fast-acting. In the last week alone thousands of Oregonians have lost their jobs to widespread layoffs, and small businesses are shuttering their doors due to the impact of the coronavirus. These Oregonians need immediate assistance to afford food, rent, and other basics. The term “flattening the curve” being invoked in this public health crisis means mitigating the spike in coronavirus cases by taking immediate steps. That same urgency should apply to our economic response. We must “flatten the dip” and limit the economic decline resulting from this pandemic.
Many of the proposed plans include means testing — tying the availability or size of a benefit to a person’s income, or targeting the benefit to affected workers. While limiting payments to those that need it most is an important goal under normal circumstances, any means testing or targeting must be done in a way that does not delay the process of sending out checks, or that leaves out those who did not file income taxes in the last year. Even a cash payment program without any income limits is a progressive option. This is a problem that would be better solved at a later date: Payments provided to top earners would need to be recouped through a progressive income tax when the crisis has passed.
Robust. Unlike Oregon, the federal government can run a deficit, and with a looming economic recession, we must commit to a robust economic recovery package that puts significant money into the pockets of Oregonians. At a time when thousands of Oregonians have had significant cuts to their income, or will lose their jobs entirely, we need a bold package that will help Oregon families make ends meet during these trying times. This is not a time for half measures or a limited response. In order to effectively aid Oregon families, and stave off the worst of the economic fallout, we must pursue an aggressive fiscal response.
Ongoing. We do not yet know how long this public health emergency will continue, and how long the ensuing economic crisis will last. Any fiscal package must be ongoing in order to adequately aid Oregonians who have indefinitely lost their incomes, and to continuously bolster the economy. One-time checks, while providing a temporary boost for people in need, will not afford Oregonians the security they need to weather this emergency. A better economic recovery package would include monthly checks for the duration of the economic downturn. These ongoing checks need to be a part of an immediate package, and not dependent on future congressional action. Oregonians need the stability guaranteed by ongoing checks.
These three principles — robust, fast-acting, and ongoing — should form the lens by which Congress and the federal government respond to the COVID-19 pandemic and resulting economic fallout. We urge Congress to utilize these principles when crafting the next response to the ongoing economic and public health crisis.
Act now: Senate Republicans released a regressive proposal for cash payments to Americans that gives the least to those most in need. Individuals with little or no tax liability, or who did not file federal taxes last year, will receive less than people who made more. This is done through a phase-in based on the previous year’s tax liability. In addition to being regressive, this provision will likely slow down the process of putting cash into the pockets of those struggling to get by.