Stand up for the facts!
Misinformation isn't going away just because it's a new year. Support trusted, factual information with a tax deductible contribution to PolitiFact.
I would like to contribute
If Your Time is short
The minimum wage hike is out; the $350 billion for state and local governments is still in.
There are tighter limits on the stimulus checks, now with a $160,000 joint income cut off.
A handful of infrastructure projects, criticized by Republicans, fall by the wayside.
Senate rules and Senate politics are working their will on the pandemic relief and stimulus plan.
The total price tag is about $70 billion less than in the House version.
The individual stimulus checks will still be $1,400, but won’t be sent to families with joint incomes over $160,000, a 20% haircut from the upper limit in the House. The $15 minimum wage is gone. Extra unemployment payments could end up at $300, rather than the $400 in the House bill.
Senators also discarded a few other items.
Republicans railed against operating money for a bridge between the U.S. and Canada, and a $125 million grant to help extend the Bay Area Rapid Transit system in the San Francisco Bay area. Both were dropped from the Senate bill.
But the Republican critiques of the bill largely remain the same.
They say it spends too little on the health side of the pandemic, and spends far too much to spur an economy that already is on the mend. A small group of Senate Republicans had a much smaller $618 billion alternative to the Democrats’ $1.9 trillion plan.
The stimulus checks will cost about $410 billion. Beyond that, the details of the Democratic version might continue to shift, but here are the essential building blocks.
Aid to states and localities is the single biggest item that Democrats want and that Republicans reject. It would send $220 billion to states, territories and tribal governments, and $130 billion to cities and counties in order "to mitigate the fiscal effects stemming from the public health emergency."
The measure enjoys broad support at the local level. Bipartisan groups such as the National Association of Counties have lobbied hard for passage. Some Republican mayors back it, along with West Virginia Gov. Jim Justice.
There’s data to say that the pandemic has put pressure on state and local governments. But gaps in the data make it hard to quantify the total impact. Thanks to earlier federal stimulus aid, states avoided the revenue hits they expected, although more than half saw revenues drop. One thing is certain: State and local governments have shed about 1.3 million jobs since the pandemic hit.
The bill extends unemployment coverage through August and adds an extra $300 to $400 a week in benefits. The price tag for that and other unemployment compensation changes is $242 billion. It would raise the child tax credit from $2,000 to as much as $3,600, at a cost of nearly $90 billion. Medicaid, the government’s health insurance for lower income households, would grow, as would health insurance premium subsidies, for an additional $75 billion.
Republicans cast all of these as "policies that destroy jobs." Their biggest reason was the hike in the minimum wage, which is now gone. They also argued that the child tax credit and health care elements would lead to fewer hours worked. But people choosing to work fewer hours isn’t exactly the same as a loss of jobs.
Economists by and large expect the bill to increase the number of jobs, and if anything, the concern is that it might overheat the economy.
Economist Matt Weidinger at the American Enterprise Institute, a market-oriented think tank, wrote that job growth might fall short of the Democrats’ hopes, but no forecast saw the number falling. Pumping billions into the economy would drive up demand, said Brookings economist Louise Sheiner, and "when demand for output increases, demand for labor increases as well."
The bill has about $128 billion for primary and secondary schools, and another $40 billion for colleges and universities.
Republicans describe the local school money as part of the "bailout" for states and local government. They also say, accurately, that only 5% of the money for local schools comes in fiscal year 2021. "When does the White House think schools should open?" they said.
Democrats counter that schools will need money in the long run to make up for the lost year when schools went online. There’s also a bit of a timing mismatch between the school and federal fiscal year. Schools ease back after June and don’t fully restart until late August and September. The federal fiscal year ends in September.
Kevin Welner, education professor at the University of Colorado at Boulder said reopening schools is the "easy part."
"The recovery from the pandemic will require a sustained commitment to addressing the needs of the nation’s children," Welner said. "For school districts, budgetary commitments cannot only be short term."
Republicans criticize the bill for spending relatively little on issues tied to the health aspects of the coronavirus.
"There’s about 9% … actually going to COVID, meaning 91% of it is not even COVID-related," said Rep. Ted Budd, R-N.C. PolitiFact rated that Half True.
Broadly, the bill offers about $160 billion for vaccines, vaccine distribution and public health measures to coral the virus.
In a $1.8 trillion package, even $160 billion represents a small slice. There is debate over the right balance between dealing with the pandemic’s health impacts on one hand,and its economic impacts on the other. The two are intertwined. The previous major federal relief bills offered both economic stimulus and funds to stop the virus from spreading. While the current package spends money in different ways, it follows that broad outline. Economists vary on whether it overshoots on the economic stimulus.
Republicans go further to say the bill is loaded with congressional pork and spending wholly unrelated to the pandemic.
The measure does include a number of items, such as $270 million, split between the National Endowment for the Humanities and the National Endowment for the Arts, $200 million to the Institute of Museum and Library Services, and $50 million to address environmental issues in minority and low-income neighborhoods. There’s also $50 million for family planning, some of which could go toward Planned Parenthood.
There is nearly $40 billion for child care and about $10 billion to help lower income families pay for food and utilities. There is $25 billion to help renters and small landlords with back rent. The bill also has $50 billion in loans and grants to businesses hard hit by the pandemic.
Joint Committee on Taxation, Estimated Revenue Effects Of An Amendment In The Nature Of A Substitute To H.R. 1319, The "American Rescue Plan Act Of 2021" March 4, 2021
Congressional Budget Office, Estimated Budgetary Effects of the Amendment in the Nature of a Substitute to the American Rescue Plan Act of 2021, March 4, 2021
Congressional Budget Office, Estimated Budget Effects of the American Rescue Plan Act of 2021: By section, Feb. 19, 2021
Joint Committee on Taxation, Estimated Budgetary Effects Of The Revenue Provisions Of The Budget Reconciliation Legislative Recommendations, Feb. 15, 2021
U.S. House Budget Committee, American Rescue Plan Act of 2021, Feb. 19, 2021U.S.
House Budget Committee - Republican, FY 2021 Reconciliation, accessed March 3, 2021
House Budget Committee - Republican, Cliff notes, accessed March 3, 2021
House Budget Committee - Republican, Dems’ $1.9T COVID relief bill – wrong plan, wrong time, wrong reasons. Here’s why, Feb. 24, 2021
American Enterprise Institute, How many jobs will Democrats’ $1.9 trillion stimulus plan create?, Feb. 11, 2021
American Enterprise Institute, How would a child allowance affect employment?, Feb. 8, 2021
Bond Buyer, Republican support for stimulus bill durable outside the Beltway, March 2, 2021
Brookings Institution, The macroeconomic implications of Biden’s $1.9 trillion fiscal package, Jan. 28, 2021
Congressional Budget Office, Estimated Budget Effects of H.R. 1319, the American Rescue Plan Act of 2021, March 3, 2021
Congressional Budget Office, Potential Statutory Pay-As-You-Go Effects of the American Rescue Plan Act of 2021, Feb. 25, 2021
Congressional Budget Office, Reconciliation Recommendations of the House Committee on Education and Labor, Feb. 9, 2021
Congressional Budget Office, Reconciliation Recommendations of the House Committee on Energy and Commerce, Feb. 14, 2021
Congressional Budget Office, Reconciliation Recommendations of the House Committee on Ways and Means, Feb. 15, 2021
John Cornyn, tweet, March 3, 2021
Office of Sen. Susan Collins, Proposed sixth COVID relief package, accessed March 4, 2021
Bloomberg, Senate Final Vote on Stimulus Likely Pushed Into Weekend, March 4, 2021
Washington Post, As Senate rushes $1.9 trillion bill through Congress, Biden faces doubts over whether it’s still the right package, March 4, 2021
U.S. House Committee on Oversight and Reform, Coronavirus State and Local Fiscal Recovery Funds, Feb. 10, 2021
U.S. Treasury Department, The CARES Act Provides Assistance for State, Local, and Tribal Governments, accessed Feb. 10, 2021
National Association of State Budget Officers, Fiscal Survey of States, Dec. 23, 2020
Federal Reserve Board of St. Louis, Local government employment, Jan. 1, 2021
National League of Cities, Over Two Thirds of Cities Say Condition Will Worsen Without Federal Stimulus, Dec. 1, 2020
American Enterprise Institute, State and local governments need help. Pass COVID-19 relief now., Dec. 11, 2020
Committee for a Responsible Federal Budget, Four Key Elements of the American Rescue Plan, Feb. 24, 2021
Congressional Budget Office, Labor Market Effects of the Affordable Care Act: Updated Estimates, February 2014
PolitiFact, What’s in Joe Biden’s $1.9 trillion American Rescue Plan?, Jan. 15, 2021
PolitiFact, Fact-checking whether Democrats’ ‘wish list’ is in $1.9 trillion relief bill, Feb. 26, 2021
PolitiFact, Budd says 9% of stimulus targets COVID, the rest is 'not even' related, March 1, 2021
Email exchange, Louise Sheiner,senior fellow, Economic Studies, Brookings, March 4, 2021
Email exchange, Kevin G. Welner, professor of education, University of Colorado at Boulder, March 3, 2021
Email exchange, press office, Office of Senate Majority Leader, March 4, 2021
Email exchange, press office, House Budget Committee - Republican, March 4, 2021