Let Them Eat $600 Cake!

There’s finally going to be another COVID-19 relief package, which will distribute roughly $900 billion in aid to people across America. But it’s a little confusing what we’re supposed to do with it, considering there’s not all that much to it: only a $600 direct stimulus payment, and a boost in state unemployment insurance by $300 a week. 

“As the American people continue battling the coronavirus this holiday season, they will not be on their own,” Senate Majority Leader Mitch McConnell tweeted last night. “Congress has just reached an agreement. We will pass another rescue package ASAP. More help is on the way.”

But, who will this really help? And how will it help them? It’s certainly not enough money to help substantially with rent or mortgage payments, or even grocery bills for very long. So, is it just for those people trying to buy the much sought-after Playstation 5 when they’re back in stock? Is this just another instance of out-of-touch rich people thinking that, between the first $1,200 check and this one, everyone can now afford the cheaper model Peloton?

If you don’t really know the answers to those questions but just feel ambient anger, don’t worry, you’re not alone. Twitter mathematicians have calculated exactly what $600 amounts to: a slap in the face.

For those who’ve been unable to afford food or housing for months now, how is the new stimulus package anywhere near enough? The $600 is a one-time payment for individuals, and people will receive $5 less for every $100 they made over $75,000 in 2019. In fact, if you’re one of those unemployed Americans who were pushed off an income cliff when the $600 per week unemployment boost expired at the end of July, you’re in particularly dire shape now, since the new bill’s unemployment benefits are only half what the old ones were. Though these people have been waiting on a lifeline, our government has been pretending not to see that anyone is drowning.

The $600/week unemployment was a contentious amount, with conservatives claiming it would make people not want to return to work (something that’s been disproven). It was also a rare acknowledgement of reality, of what it actually takes to survive in the U.S. It was roughly equivalent to getting paid $15/hour — what many believe the federal minimum wage needs to be raised to — for a 40-hour workweek. Combined with the state unemployment benefits, which don’t replace even half of lost wages, the scheme aimed to meet the U.S. median wage of around $19/hr. Data For Progress, which conducts polling and analysis on progressive political causes, has been sharing people’s experience of losing unemployment money through a Twitter account called @ExtendCaresUI. The stories are dire, and an indictment of how much the U.S. government has failed its citizens.

These are just a few of the recent submissions:

Since the $1,200 stimulus payment in the spring and the expiration of the $600/week unemployment in July, people have fallen even further behind on bills and rent. Over 12 million people are estimated to be over $5,000 behind on their rent. Unfortunately, a one-time payment of $600 won’t help that, as it's below the median monthly rent in every single U.S. state. According to a Business Insider analysis based on median expenditures of households across major U.S. cities, $600 would last most households just a few days.

Yet all that Congress can pony up is a single $600 check and $300/week for those who qualify for unemployment — and this extra unemployment isn’t even retroactive. How is this stimulus package supposed to help people facing eviction, when there was never rent cancellation in the first place? After the $300/week runs out in a mere 11 weeks, can we be confident that Congress will pass anything else? Where is the money people need to survive supposed to come from? GoFundMe? Kim Kardashian?

The new relief package also doesn’t contain any additional funding to state and local governments. State governments have been running out of money, with Pew reporting that at least 20 states have applied for loans from the federal government to be able to keep paying out unemployment insurance.

It didn’t have to be this way. Other nations have taken a different approach. Until October, Canadians who lost work due to COVID could receive $2,000 CAD (roughly $1,500 USD) a month for up to four months. In Australia, people with low incomes received two direct payments of $750 AUD (about $568 USD) and those who’d lost income from COVID could receive $1,500 AUD ($1,136 USD) every two weeks, which was later reduced to $1,200 AUD every two weeks, under a wage subsidy program.

Many countries have installed such wage subsidy programs in response to the pandemic, in which the government pays qualifying employers directly to keep their employees on payroll instead of furloughing or laying them off. Denmark subsidized between 75 to 90 percent of workers’ paychecks. The U.K., currently undergoing another lockdown, has chosen to extend a program that replaces 80 percent of workers’ wages.

Lower-income workers in France are getting roughly 70% of their wages subsidized by the government, and its labor minister has suggested that wage subsidies may be necessary for up to two years in order to ensure everyone recovers from the economic disruption. Germany’s wage subsidy program has already been extended to last through 2021. Spain launched a basic income program in May for those who aren’t making a livable income, which would give about $500 a month to a single-adult household and more if you have dependents. While the program has been criticized for its messy rollout and not going far enough, it’s at least an attempt at a response to Spain’s high unemployment and poverty rates. Our government, in contrast, seems satisfied with just ghosting us.

And while looking at what other countries have done is informative, the truth is that the U.S. should be going beyond what anyone else has done — no country has been as severely affected by this virus. If the CARES Act was meant to be a one-time deal no matter what, then maybe the federal government should have taken a more serious attitude toward containing the spread in the months after the bill was passed. Instead, the national response has been an unreliable patchwork of state-led plans, and we’ve consistently set new records for daily case rates and deaths. While no country has been perfect in meeting the needs of its people during the pandemic, perhaps no country has been as cruelly negligent as the U.S.

Though many Republicans clutched pearls over a $900 billion stimulus package, it’s a shadow of what could have been, because $900 billion is not a lot compared to the size of the need — people have been suffering from COVID for 9 months now. In fact, $900 billion is not a lot compared to the spending we justify for a lot of other things, including our trillion-plus annual defense budget. And, $900 billion is not a lot compared to earlier proposed follow-ups to the CARES Act. Passed by the House back in May, the Heroes Act wanted to give $3 trillion in aid, and it would have extended the $600/week unemployment payments until January.

Maybe the $600 stimulus check is simply the latest test of our collective grasp on reality. It’s decorated to look like adequate aid for people trying to survive the pandemic, but like everything else this year, it turns out it’s actually just cake.