After last year’s recovery, when the United States emerged from the lockdown and pandemic, we are well into 2022, and the country’s economy is at a crossroads.
The stimulus checks passed by the members of Congress for the last two years have helped the country to stand tall, avoiding another deep recession or possibly a depression. However, the policymakers are worried as they decide if putting more money in the commoner’s pockets will boost inflation or help them cope with it.
Here we discuss the matter deeply:
Thesis one: more stimulus checks may drive the prices upwards:
Even though it is a matter of debate, the 5trillion USDs released in the market over the years of pandemics affected rising inflation. Bank balances have soared in the U.S. as the stimulus checks kept coming. However, according to the JPMorgan Chase Institute, it remains higher than the pre-pandemic levels.
Thesis two: American households need more money to cope with the rising prices:
However, a counterargument presented by the U.S. Department of Health and Human clearly states how the stimulus checks have kept 11 million households out of the reach of poverty.
A senior researcher at the Tax Policy Center, Elaine Maag, has shared her views with Changing America, saying it might help the country cope with the rising inflation. Former presidential candidate Andrew Yang has also supported her statement.
State Stimulus Check Packages And Their Effects:
Some states have taken matters into their own hands as they see no new checks are coming. California and Georgia have already introduced some stimulus checks. However, these state-owned checks may not affect inflation considerably as they limit up to $500 compared to federal government trillions.