HOUSTON – House Democrats released more details about their COVID-19 relief bill and its $1,400 stimulus checks. This comes after President Joe Biden announced a $1.9 trillion stimulus package, which local analysts say will help people and the economy.
In this new bill, Democrats decided on keeping the income cutoff the same. It includes $1,400 payments for individuals who earn up to $75,000 per year and their dependents and 28-hundred for married couples earning up to $150,000 per year.
University of Houston’s Economics Department Chair and professor Dietrich Vollrath said the $1.9 trillion stimulus package is appropriately sized. When asked if the stimulus package would help people and help the economy, Vollrath put it bluntly.
“Yes, the simple answer is yes,” Vollrath said. “One of the nice parts about this relief package is that rather than kind of picking around in details and wiggling rules and tax rules and stuff, it does what you want to do for relief, which is it just sends people money. The biggest issue people have when the economy turns south is that they don’t have enough money. So by giving them money to pay their bills, put food on the table ... to be able to keep people going that way -- that’s a huge direct benefit.”
He said the package needs to be big in order to get the economy back up to where it was sooner. Dietrich said borrowing money now would make sense.
“With interest rates so low, paying back the debt won’t be a big deal, and with the economy so behind, inflation won’t be a big deal either,” Vollrath said.
He said starting the economy will take an active effort from the government during these times of need and how much help matters.
“What’s more dangerous, is doing too little more dangerous or is doing too much? I think what we learned from the financial crisis of 2008-2009 is that doing too little is the most dangerous...It’s like riding a bike if you don’t go fast enough you can’t stay up,” Vollrath said.
Adriana Fernandez is a visiting assistant professor for Texas Southern University with a Ph.D. in Economics. She is studying this topic closely.
“This is like money coming to the rescue to save the economy,” Fernandez said.
Fernandez said after analyzing the behavior of those receiving the stimulus checks, she said data shows that the stimulus packages help and that many people are putting the money back into the economy and certain industries could come back quickly with some assistance. Fernandez said helping the economy now should be the priority.
“Money is needed now. Now. Because people don’t have to pay their rent now and they need food on the table now and I guess the government is doing a great job on that,” Fernandez said.
Under the House plan, adult dependents would also add $1,400 to each household per dependent. This version of the bill will be voted on by the House Ways and Means Committee this week.