The federal government is not going to release a fourth stimulus check anytime soon. At least not unless circumstances change drastically. While the pandemic remains under control and the economy limping back to normalcy, the high inflation rage remains a major irritant for Americans, especially those with low and moderate-income.
The US federal government’s response to the coronavirus pandemic had been ample, though initially a little delayed by the Trump government. The Republican administration had tried to deny the emergency for weeks till the pandemic spread throughout the US. It has led to the death of over 1.11 million Americans with over a hundred million affected.
At the peak of the pandemic period, the US government sent out a series of stimulus checks starting with the $1,200 payment within a month of the shutdown in the first quarter of 2020. It was followed by an additional check of $600 declared the same year in December, though the payment was in January.
The third stimulus check came immediately after in March 2021 as the Democrats took over in January of that year under President Joe Biden. The third economic impact payment was part of the American Rescue Plan Act of March 2021 which was a more comprehensive economic support package.
The Rescue Plan included the stimulus check, but it also gave elaborate support to various organizations like hospitals, and educational institutions and also to local, tribal, and state governments.
It was these support measures that helped the economy recover fast and by the third quarter, the US economy witnessed a mini-boom that lasted the year.
But a lingering after-effect of the pandemic on the economy was inflation. Rising prices decimated the progress witnessed during the boom period of the third and fourth quarters of 2021.
Record inflation reached its peak in the second and third quarters of 2022 beating the 4-decade-old record to touch 9.1% in June 2022.
It was left to the states to come up with various forms of inflation relief through paper stimulus checks, tax rebates, bank transfers, and, debit cards. The payments were mostly sourced from the Rescue Plan funds given to states with the freedom to spend it on poverty-alleviating measures. But the funds have been misused in some cases by Republican states. Alabama plans to use $400 million of the pandemic relief funds for constructing a prison.
The End Of The Child Tax Credit Marked The End Of All Federal Stimulus Checks
The midterm polls have put paid to what little change there was of the federal government sending out another round of stimulus checks, this time as an inflation relief measure. The shape of things to come was outlined when President Joe Biden could not even push through the Child Tax Credit stimulus check.
Before the midterm election led to the Democrats losing control of the House of Representatives, Joe Biden had control of both houses. Though the Senate was split right down the middle with fifty seats each, President Biden had the vote of the Vice President to fall back on in case of a tie.
But the refusal by Senator Joe Manchin put paid to Biden’s attempts to extend the Child Tax Credit stimulus check to 2025 in place of the one year for which it was initially sanctioned.
The midterm elections have led to Biden losing control over the House of Representatives that have passed into Republican hands. In the Senate, it is only marginally better with the Democrats leading by 51 to 49.
A Fourth Stimulus Check Remains A Low Priority For Politicians
The Republicans have managed to tag inflationary concerns with the stimulus checks, especially the economic impact payment under the Rescue Plan. While it has been purely a political move, experts have also advised that any further federal stimulus check could at least delay the high rate of inflation creeping back to normal anytime soon.
Rising inflation continues to be a major concern for Americans as it continues to remain almost three times the normal pre-pandemic figure at 6.04%. it is still twice as high as the long-term average which stands at 3.28%.
It has been the states all along for the last five quarters starting the first quarter of 2022. While most payments were one-offs, some states have moved forward with the fresh announcement. But payments this time round are expected to be more focused and will primarily target residents in the lowest income category. Many such residents lost out on many of the pandemic support measures, mainly because they did not exist in the records of the IRS.
Even the IRS sent out letters in the last quarter of 2022 to around 10 million Americans. These individuals and households had missed out on the economic impact payment primarily because they did not exist in the records of the IRS.
It remains a simple fact that the fourth stimulus check is not going to happen as most politicians think there is no urgency at the moment. The stimulus check was a hot issue for politicians when the economy was stagnant as a result of severe restrictions due to the pandemic. The economy sorely needed a boost then, but things have changed and it is now on the road to recovery.
The unemployment rate is down to the pre-coronavirus rate of around 3.7%. So, it is now back to what it was. Other than the high inflation, there is more good news in general as even more Americans are back to earning, which has also reduced the urgency for another stimulus check.
But it remains a fact that millions of Americans who truly deserved the stimulus check missed out on it because they were missing from the account of the IRS, the agency tasked with reaching out to the deserving Americans and sending out the stimulus checks.
To make up for the lack of data on this section of the population, the IRS relied on data from other sources. The IRS has faltered badly when it comes to the distribution to parents receiving federal benefits. Families which did not file returns because of low earnings did not receive their stimulus checks, Child Tax Credit stimulus checks, and Earned Income Tax Credits.
