Following the passage of the CARES Act that gave direct cash assistance to millions of American families, Congress is already working on CARES 2 -- another direct cash infusion to help those struggling from the economic crisis.
Of CARES 2, Speaker Pelosi said, “Let’s do the same bill we just did, make some changes to make it current.”
Extraordinarily, CARES 1 already expanded who qualifies for cash assistance in America. UI was dramatically expanded to include gig, part-time and freelance workers for the first time. And the one-time $1,200 checks will go to nearly every American making less than $100,000, including those with no income for the first time. These signal a significant shift in our understanding of who is deserving of help in America.
But CARES wasn’t perfect. As we look at CARES 2, Congress needs to “make some changes to make it current.” Already, some Members of Congress have proposed solutions -- but there’s more to be done to address the gaps and the deepening need:
The one-time $1,200 payments aren’t enough.
Americans should get monthly $2000 payments for the length of the crisis. A growing number of proposals from Sens. Michael Bennet, Sherrod Brown, and Cory Booker, Republican Sen. Josh Hawley, Sen. Bernie Sanders, Reps. Don Beyer and Madeleine Dean, Reps. Tim Ryan and Ro Khanna, Rep. Maxine Waters, Rep. Rashida Tlaib, Rep. Ilhan Omar, Reps. Pramila Jayapal and Mark Pocan, and the New Democrat Coalition in the House would make direct payments recurring.
We should extend payments beyond the immediate crisis to help Americans who were already on the verge of poverty. In addition to direct cash payments to keep people’s heads above water, some members of Congress, including Speaker Pelosi, Rosa DeLauro, Ways & Means Chairman Richie Neal, and others are looking at expanding the Earned Income Tax Credit to help low- and middle-income people get back on solid ground and build a strong foundation to weather the next storm.
Large groups of Americans were left out.
Undocumented workers and adults and children with Social Security numbers who live in mixed-status households are excluded from direct payments (though the latter groups were eligible for tax cuts under the TCJA). Rep. Lou Correa introduced a bill that would fix this by including individuals who file taxes using an ITIN. Rep. Ilhan Omar is planning to address mixed status households.
College students and older high school students are not eligible. Senator Tina Smith introduced a bill backed by Democratic Whip Dick Durbin that would fix this by making older children and adult dependents eligible for a direct payment. The same bill was introduced in the House by Rep. Angie Craig.
Many people won’t see their checks for months, or at all.
Some Americans will have to wait months for payments. While the first 60 million payments are expected to go out next week via direct deposit--a sign that the Treasury Department is capable of making large numbers of payments quickly--Americans who don’t have current bank information with the Treasury Department will have to wait longer for the agency to issue paper checks. While many of these delays will resolve once the Treasury Department has people’s information, Congress should look at using SNAP/TANF cards and Treasury prepaid debit cards as additional ways to get money out faster.
Many low-income veterans, seniors, and people with disabilities who don’t typically file tax returns would have to do so in order to receive benefits. The administration changed its guidance to allow Social Security recipients to receive payments automatically, and Senators Brown, Hassan, Bennet and Booker have urged the Treasury Department to do the same for SSI and VA beneficiaries.
Many of the most vulnerable, including the unbanked and those whose incomes are so low that they don’t file taxes, won’t receive any payments at all unless they file tax returns they’re not otherwise required to file. Congress must make it easier for these Americans to receive payments without having to go through the burdensome process of filing a tax return.