President-elect Joe Biden plans to propose a sweeping $1.9 trillion stimulus package to revive the economy and offset the stifling effects of the coronavirus pandemic.
The so-called “American Rescue Plan” earmarks $1,400 in payments for workers and their families on top of the $600 payments from December, in addition to higher jobless benefits and an extension of the program through September. It also proposes $400 billion that will support a program to accelerate vaccine distribution, $350 billion to help state and local governments to bridge their budget shortfalls, and a $15 national minimum wage.
The proposal comes a day after the House of Representatives voted overwhelmingly to impeach outgoing President Donald Trump for a second time for inciting an insurrection at the U.S. Capitol on Jan. 6.
Biden’s plan indicates a major shift in policy from the Trump Administration, and advances the idea that economic recovery is dependent on the ability to end the pandemic—and key to that is accelerating vaccines to all Americans through community centers that can facilitate mass vaccinations. It also acknowledges the pleas of many state and local officials, including New York Governor Andrew Cuomo, that they need economic aid, too—exhortations that Trump has ignored.
The National Retail Federation praised the plan as “an encouraging signal” that the incoming administration will move swiftly to bolster consumers and businesses.
“Jobs have been lost, businesses have been closed and our economy has struggled,” said NRF president Matthew Shay. “We support providing critical government assistance in the form of direct payments to families and individuals whose lives have been disrupted, further aid for small businesses across the country, and tools to keep businesses open and the economy growing.”
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Shay also stressed the “invaluable role” retail is playing to augment the vaccine rollout that will protect more of the population quickly. “In our discussions with the Biden transition team and congressional leaders,” he added, “there is unanimity in the recognition that we must all work together to overcome the challenges brought about by Covid-19.”
The president-elect is expected to formally announce the plan, the first of two major spending initiatives, during a speech set for Thursday night from Wilmington, Del. The second one will likely come in February, and that one is expected to tackle much-needed infrastructure reforms, climate change, job creation and racial equity.
Despite a Blue Wave win after the Democrats claimed two Senate seats last week in a Georgia electoral runoff, Biden encounter difficulty in garnering Senate support. While the Democratic Party, with a 50-50 division, gets the tie-breaking vote from Vice President-elect Kamala Harris, Biden must find a way to sway moderate Republicans.
Chris Krueger, managing director at the Cowen Washington Research Group, said that bipartisan support might scale back the package to $900 billion.
Meanwhile, Biden will be hoping he can move fast on the stimulus plan and vaccination program. The Centers for Disease Control on Thursday predicted that the U.S. Covid-19 death toll could rise by 92,000 by Feb. 6, escalating total deaths to 477,000. The U.S. coronavirus mortality rate stands at nearly 4,000 a day, a staggering number that’s far higher than the spring when New York City was the global epicenter of the pandemic. Data shows that someone dies from Covid-19 every minute in Los Angeles County. Highly transmissible strains like the variant out of the U.K. appear to be driving up infection rates.
Additional reporting by Jessica Binns.