Fourth stimulus check: Congressional support grows for new direct payment

WASHINGTON (Nexstar) — Members of a congressional committee are calling for additional rounds of economic relief from the federal government for families still struggling during the coronavirus pandemic.

With the third round of $1,400 stimulus checks behind us, a letter sent late last week to President Joe Biden from seven Democrats on the House Ways and Means Committee calls for a fourth and fifth round of direct payments to assist people with housing, food and other payments. The committee oversees government budgeting and taxation. The group that signed the letter represents about 15% of the committee’s members.

“Families and workers shouldn’t have to worry about whether they’ll have enough money to pay for essentials in the months ahead as the country continues to fight a global pandemic and recession,” reads the letter.

The letter, dated May 17, doesn’t mention a dollar amount but lays out the possibility of two additional rounds of relief.

“A fourth and fifth check could keep an additional 12 million out of poverty,” the letter reads. “Combined with the effects of the [American Recovery Plan], direct payments could reduce the number in poverty in 2021 from 44 million to 16 million.”

Previous congressional letters asking for additional relief have been signed by more than 80 Democratic lawmakers.

Even with growing support among some Democratic lawmakers, a fourth round of stimulus checks faces major hurdles. The third round of relief squeaked through Congress thanks to a budget loophole when it failed to find bipartisan support. Since that time, numerous Republican governors have refused federal COVID-19 unemployment insurance benefits arguing they encourage people to stay at home and collect money instead of getting back to work. Proposals for additional direct payments would likely face similar criticism.

On top of that, Democratic leaders like Nancy Pelosi have been relatively quiet on the possibility of additional checks. Instead, their focus is on passing Biden’s infrastructure plan.

When asked directly about stimulus checks earlier this month, White House press secretary Jen Psaki responded by saying, “We’ll see what members of Congress propose,” adding that the payments “were not free.”

The government has issued three direct payments since the beginning of the coronavirus pandemic. About a year ago, the government sent $1,200 stimulus checks to most Americans through the CARES Act. In late 2020, the government approved payments of $600 per person. That was followed up by the third stimulus payment of $1,400.

In the latest round of COVID relief aid, the U.S. government said it sent roughly 159 million direct payments to households, with a total value of $376 billion.

Businesses are looking to hire and ramp up production, but are running into shortages of both employees and raw materials in some industries.

The recovery of America’s job market hit a pause last month as many businesses — from restaurants and hotels to factories and construction companies — struggled to find enough workers to catch up with a rapidly strengthening economic rebound.

In addition, construction companies and manufacturers, especially automakers, have been left short of parts because of clogged supply chains and have had to slow production for now. Both sectors pulled back on hiring in April. And some businesses say they believe that a $300-a-week jobless benefit, paid for by the federal government, is discouraging some of the unemployed from taking new jobs.

Still, companies have added jobs for four straight months, the Labor Department reported, though the government lowered its estimate of job growth for February and March by a combined 78,000.

The resumption of hiring has encouraged some Americans to start looking for jobs, which means they are newly counted as unemployed if they don’t immediately find work. This is what happened in April, when the unemployment rate ticked up from 6% to 6.1%.

Employers are now posting far more jobs than they did before the pandemic, and “help wanted” signs dot many restaurant windows. Other telltale signs of labor shortages have emerged as well: Average hourly pay rose 0.7% in April to $30.17, which the government said suggests that the fast reopening of the economy “may have put upward pressure on wages.” The average workweek also rose, evidence that companies are asking their employees to work more.

“Demand is outpacing supply,” said Daniel Zhao, senior economist at Glassdoor, a job listings website. “That’s something that is occurring across the economy, in semiconductors to lumber, and we’re seeing a similar crunch in the labor market.”

The Associated Press contributed to this report.