Even as states move ahead with sending stimulus checks to residents, the federal administration remains tied down by deep disagreements between the ruling dispensation and the opposition. The approaching midterms have complicated matters, and it is definite that citizens can forget any more benefits from Washington.
To worsen matters, over 7 million people who have filed for unemployment benefits since March 2022 are still waiting to get their payments. The state unemployment systems have been overwhelmed by the flood of applications, a study of the US Census Bureau data reveals.
The economic impact of the pandemic was enormous with the large-scale closure of businesses and other organizations. It led to an unprecedented level of unemployment. The recession that ensured took a disproportionate toll on communities that had no access to federal or state benefits. They included Blacks, Latinos, immigrants, low-wage workers, and women who were caretakers in private facilities.
Millions Without Access To Both Stimulus Checks And Unemployment Benefits
Even more, than a year after the issue gained prominence, the number of unemployed Americans without access to unemployment benefits continues to grow. While the number of initial claims for jobless benefits has seen a gradual trend downward, it is still around 800,000 a week, well more than the weekly record before the pandemic.
Many unemployed have been forced to stop paying their bills, which include utility bills, and rent. The little money that the unemployed make is mostly spent on buying food, which has touched record levels.
While some states such as Democrat-ruled California have protection in place against utility shutoffs, the federal moratorium on eviction lasts through the end of the year. But the affected know that they will have to pay it all back eventually.
The stress and helplessness are overpowering for millions in the face of unemployment or pay that is below pre-pandemic levels for most. Even for those who have benefitted from the generous rise in all round wages in 2021, the record inflation has meant that in real times they are on an average earning around 5% lower in real terms.
The feeling of helplessness, compounded in the face of the halt in further federal stimulus checks, has taken a toll on the emotions and mental health of millions.
And many point out that the benefits that they will receive will not cover her past dues and other delinquent bills. But the employment development department of various states continues to renege on payments.
The Tax System Proved Effective In Distributing The Stimulus Checks And Other Benefits
The federal administration was compelled to use the tax system to disburse benefits to millions of households under the stimulus check programs. While it was the largest reduction among all recent major government benefit disbursals and led to a 4.5% reduction in the poverty rate, many communities were left out of the system.
The tax system was an efficient mechanism for the delivery of emergency aid as it had all the necessary data for quick and efficient distribution. It quickly delivered the emergency aid that required no applications and automatically deposited the money to the bank accounts of recipients.
Failure To Receive Various Stimulus Check Benefits
However, many individuals and families missed out on the support system. The tax-based system missed out on certain sections of the population. This was especially true for individuals with very low incomes who were less likely to adhere to tax filing obligations.
Other families with low or no knowledge to tax preparation, or having no access to the system, and citizen children with non-citizen parents also were more likely to miss out on the payments.
The tax structure has turned into a key mechanism to provide economic support to individuals and their children, including the federal expanded Child Tax Credit stimulus checks and the other state tax credit. It became vital to understand those sections of the population which are more likely to stay under the radar of the tax authorities and devise ways to ensure that there is a more inclusive and equitable approach to the distribution of the money.
Many households have been disproportionately affected by the COVID-19 pandemic. Unfortunately, the most affected were also the ones more likely to miss out on the 3 rounds of stimulus checks from the federal administration.
Blacks, Latinos, and certain Asian groups were less likely than their peers to receive the stimulus checks even though the eligibility for the second and third rounds was extended to members of mixed-immigration status households.
It especially benefitted households in which some members had qualifying Social Security numbers while the rest of the members might not possess them. It was part of an improved outreach program of the administration to cover all demographics of the population.
Several Groups Missed Out On The First Stimulus Check
It was found that the Hispanic, Black, and several Asian communities were most likely to have missed out on the first stimulus check than the following two. The gap in the economic impact payment shrunk during the later period after January 2021 when the second and third stimulus checks were distributed.
The third stimulus check under the American Rescue Plant Act signed by incoming President Joe Biden was more effective in being inclusive and wider coverage of the various sections of the population.
Education also played a key part in deciding the likelihood of a person receiving a stimulus check. Families where the highest education was higher secondary or lower. Households with self-employed respondents also showed a lower rate of recipients of the stimulus checks, especially the first stimulus check under the CARES Act.
The Rescue Plan corrected many of the gaps that excluded low-income households, Blacks, Latinos, and several Asian groups, especially migrants from the middle-east. The federal administration is looking into other modes of delivery of stimulus aid that will supplement the good work done in the past two years by the IRS.
But even user-friendly means by the administration and expansive outreach programs of providing payment increase the rate of beneficiaries, especially in the third round of stimulus checks. The recent expansion of the Child Tax Credit stimulus check and the inclusion of states into the stimulus check system underscores the need for research into which people benefitted and which missed out on the benefits.