States Propose Their Own Stimulus Packages Before Federal Aid Expires This Year

Days before Thanksgiving, several photographs depicting thousands of Americans waiting in line for hours to receive assistance from local food banks went viral — even as the Dow reached 30,000. 

These food lines are just one consequence of the coronavirus pandemic, which has continued to cripple the country. The problem, according to economists, is sky-high unemployment and marginal cash flow. 

According to a recent survey, an estimated 26 million adults reported that their families sometimes or frequently did not have enough food in the previous week. The Center on Budget and Policy Priorities backed the survey’s findings, noting that 12% of American adults face food scarcity, compared to 3.7% in 2019. 

Ed Bolen, the Center on Budget and Policy Priorities senior policy analyst, told CNBC that growing unemployment is the primary reason why more Americans are going hungry. “Certainly the loss of a job or a significant loss of hours can significantly impact a family’s ability to purchase food.”

He noted that food banks across the country reported heightened demand when enhanced unemployment, which offered an additional $600 per week on top of state benefits, ended at the end of July. 

Bolen added that with many protective measures put in place by the CARES Act set to expire in just a few weeks, “We’re fearful that a lot of folks are going will lose a significant part of their support if Congress doesn’t act to extend them or do something.”

With only a few working days left in December before Congress recedes for the holiday break, it seems unlikely that more aid will come. In response, some states have considered implementing stimulus packages of their own to support their citizens and fix some of the problems the federal government has failed to address.

According to Yahoo Finance, leaders from Colorado, Minnesota, New Mexico, and Washington have each proposed scaled-down stimulus measures to assist struggling Americans and small businesses before the remaining provisions from the CARES Act and President Trump’s executive actions end December 31.

In a statement, New Mexico Senate Majority Leader Peter Wirth said, “New Mexicans are hurting, and without more federal economic relief in sight we have to take action now. Assisting our small businesses, shoring up unemployment funds to help displaced workers, and providing some relief for people struggling with food and housing are all priorities the legislature strongly supports.”

New Mexico and other states have offered various solutions, such as another round of stimulus checks, renewing extended unemployment benefits by an extra 13 weeks, grants for small business owners, and programs for renters and homeowners.

The states proposing these measures are pushing for a special session to decide on a bill in the upcoming weeks. Some will vote to reuse leftover funding from the CARES Act, and others will seek to utilize funds from state revenue sources. 

“I don’t think we wait an extra day,” Minnesota Governor Tim Walz remarked during a Tuesday news briefing. “The sooner we do it and the sooner we get certainty to those families, the better.”

Individual states’ call for further aid has arisen following months of delayed stimulus negotiations. Now that the election has ended and lawmakers have yet to produce results, some states are taking matters into their own hands.

In an interview with Yahoo Money, Gbenga Ajilore, a senior economist at the Center for American Progress, said, “The actions by these four states show the failure of this Congress, namely the Senate, and the current administration. Relief was necessary starting back in the summer and should have been ongoing until the pandemic ended. The fact that the only federal action we have seen was the CARES Act passed in March and nothing since then is shameful.”

Without more federal assistance, nearly 12 million Americans will lose unemployment insurance, and millions more will face food and housing scarcity during the winter — and the pandemic. 

Before the election, it seemed like lawmakers were nearing a consensus on the House’s $2.2 trillion bill and the White House’s “almost $1.9 trillion” package. However, the Senate rejected these measures in favor of Senate Majority Leader Mitch McConnel’s $500 billion legislation. 

President-elect Biden backs the House’s proposal and has pushed for Congress to pass a measure before Inauguration Day on January 20. “Right now Congress should come together and pass a COVID relief package like the HEROES Act that the House passed six months ago,” he stated during last week’s press conference.

 

Sources
  • Konish, Lorie. “’This Can’t Wait.’ Why Long Food Lines Signal Need for More Coronavirus Stimulus Aid.” CNBC, CNBC, 25 Nov. 2020, www.cnbc.com/2020/11/25/long-food-lines-signal-need-for-more-coronavirus-stimulus-aid.html.
  • Tsekova, Denitsa. “States Mull Their Own Coronavirus Stimulus Packages as D.C. Talks Stall.” Yahoo!, Yahoo!, 25 Nov. 2020, money.yahoo.com/states-mull-coronavirus-stimulus-packages-152202836.html.
Ian Schindler