The $1.9 trillion stimulus package that President Biden signed shortly after taking office has become both the anchor and pillar of his re-election campaign.
The American Rescue Plan that the Biden administration crafted and Democrats passed in March 2021 has fueled voter discontent in sometimes paradoxical ways. Some Americans blame the law, which provided direct checks to individuals, for helping to accelerate inflation.
Others appear upset that the relief for people, businesses and school districts was short-lived. The Federal Reserve Bank of Dallas recently reported that several business contacts in its district had “expressed concerns about the reduction in American Rescue Plan Act dollars and whether nonprofits and K-12 schools will be able to operate certain programs without it.” to maintain this funding.”
Polls show Americans continue to favor Mr. Biden’s opponent, former President Donald J. Trump, on economic issues. They often point out that only relatively small portions of the electorate believe that Mr. Biden’s policies have helped them or their family financially.
At the same time, however, the stimulus measures could boost Mr. Biden’s chances in November in ways that pollsters rarely ask about.
Economists say the relief package, along with stimulus measures signed by Mr. Trump in 2020, helped speed America’s recovery from the pandemic recession. The United States has grown and created jobs in ways no other wealthy country has experienced post-pandemic.
Supporters of Mr. Biden and the law say the increased growth has helped keep the president better positioned in the election than his counterparts across Europe. The popularity of many European leaders has fallen, with some suffering party losses in recent elections or facing the likelihood that voters will soon push them from power.
Price increases continue to weigh on Mr Biden’s approval ratings and it is unclear whether he will win a second term. But he remains more popular than the leaders of France, Germany, Britain and other allies. America’s rapid economic growth and low unemployment rate, supported by stimulus measures, may help explain this divergence.
“One reason Biden has better approval ratings than most other world leaders is that his policies have contributed to large wage and wealth gains that have allowed most Americans to stay ahead despite these challenges to have,” said Bharat Ramamurti, a former deputy director of Mr. Biden’s National Economic Council, which has written extensively about the political and economic benefits of the rescue plan.
The plan included money for America’s response to the pandemic, including accelerating vaccinations. There was also help for people, businesses and governments affected by the pandemic recession. That included one-time direct payments of $1,400 for low- and middle-income people and several months of more generous unemployment benefits for people who didn’t return to work after the recession.
The law also expanded food stamp benefits, increased the parental tax credit, provided aid to renters and homeowners and provided hundreds of billions of dollars to state and local governments to shore up their budgets amid plummeting pandemic revenues. All of these programs were intended to be temporary programs, although some lasted longer than others.
Aid to local governments and schools has lasted for several years but is gradually running out. As a result, school districts across the country have begun cutting their budgets, a visible sign to parents and workers of the end of pandemic money.
When Mr. Biden signed the rescue plan into law, his advisers were confident it would help speed the country’s recovery from the pandemic recession. Republicans and even some liberal economists screamed that the bill was too big and would fuel inflation.
Ample economic evidence suggests both sides were right. Job creation and economic growth rose sharply in the United States in the months following the law’s passage, fueled by spending by consumers and business owners in line with government aid. The unemployment rate fell rapidly. America’s prosperity continues to be the envy of the wealthy world, far outpacing Europe, Japan, Canada and other allies.
But Mr. Biden’s team also believed the law would be a clear political victory for the president. That wasn’t the case, in part because economic research blamed their spending at least in part for the rise in inflation that began in 2021.
The Federal Reserve Bank of San Francisco’s largest estimate is that the stimulus measures signed by Mr. Biden and Mr. Trump in 2020 contributed up to three percentage points to an inflation rate that reached 9 percent in 2022. Other estimates are more modest.
After initially hailing the stimulus package as a political and economic success, Mr. Biden now finds himself forced to defend it in speeches to key voter groups such as black Americans. He blames corporations for persistent price increases and accuses Republicans of failing to renew some of the law’s benefits, such as an expanded parental tax credit that was only in effect for one year.
Mr Biden is also struggling to remind voters that some of the pandemic aid they relied on came from the stimulus package that he – and not Mr Trump – signed into law. While Mr. Trump insisted that his signature appear on checks sent to individuals, Mr. Biden did not include his name on the payments.
“Trump deserves the credit for sending out all the pandemic relief checks alone,” Mr. Biden said at a campaign rally in Philadelphia late last month. “It is a lie.”
With the help of Black members of Congress, Mr. Biden added, he and Vice President Kamala Harris “passed legislation to put more checks in the pockets of millions of Americans, including Black Americans — $1,400 checks the American Rescue Plan we passed, and then $300 per month per child per family through the child tax credit, which halved child poverty for black families. And I will ensure that it is reintroduced in the second term.”
Biden aides say he will reinforce that message in the coming weeks. “It will become increasingly clear who was responsible for passing these important policies and who voted unanimously against them,” said Gene Sperling, a senior adviser to Mr. Biden who oversaw the package’s spending.
Much of the reaction to the plan is due to the country’s deep political divisions.
Scott Smith, 59, a real estate agent in Canton, Georgia, said he was concerned that trillions in stimulus would worsen inflation and increase the national debt. Mr. Smith, who voted for Mr. Trump in 2020, said he was also skeptical that everyone who received the help needed it and that some of his friends had used the stimulus money for vacations.
“It was poorly thought out,” Mr. Smith said. “It’s a tremendous amount of debt that the next generation will have to take on.”
Other Americans who received pandemic aid said they have struggled to cope with higher prices since those programs ended. Ashley DePover, 35, a paraprofessional in Inver Grove Heights, Minnesota, said the expanded child tax credit was a significant boost for her and her family after they were unexpectedly homeless for several weeks in early 2022. She said the extra money she received as a tax refund helped pay for hotel costs, meals, housing applications and a deposit on the apartment her family later moved into.
Ms. DePover said she hoped lawmakers would expand the child tax credit again as she has struggled with higher food and rent costs in recent years. Still, she said she doesn’t blame Mr. Biden for the end of the stimulus and that she is “pretty confident” she will vote for him in November.
“I would have liked to keep it, but we all knew it was limited when it came out,” Ms. DePover said.
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2024-06-18 09:01:51
www.nytimes.com
