President Joe Biden’s USD 1.9 trillion plan will cut poverty in half
US President Joe Biden has announced a USD 1.9 trillion coronavirus relief package to tackle the economic fallout from the pandemic It would lift 5 million kids from the ranks of the poor and cut the child poverty rate in half, President told in a speech last week.
That would be the biggest child-poverty reduction in recent history, according to some experts who study the social safety net. But its scope isn’t far-fetched and may prove even more substantial if Biden’s plan is fully enacted, they said.
Overall, the plan which includes additional stimulus checks, tax breaks, and enhanced unemployment benefits may have the greatest impact on Black and Hispanic families.
“This seems reasonable,” Chloe East, an assistant professor of economics at the University of Colorado, said of the analysis. “If all these things Biden proposed passed, we might expect [poverty reduction] to be even larger.”
However, parts of Biden’s agenda would be temporary, potentially diluting those poverty-reduction benefits in the long run. Some conservative economists say the plan, especially aspects like a higher minimum wage and changes to the child tax credit would actually increase poverty over the long term.
The proposal includes $1,400 stimulus checks, expanded tax breaks (like the child tax credit), $400 enhanced unemployment benefits, extended jobless benefits for the long-term unemployed, and a food-stamp expansion.
Overall, these policies would reduce the poverty rate by 3.6 points, to 9% which would be below pre-pandemic levels, and lift nearly 12 million Americans out of poverty, according to an analysis published by researchers at Columbia University’s Center on Poverty and Social Policy.
The child-poverty rate would fall by 51%, the largest drop relative to other groups, to 6.6%, lifting more than 5 million out of poverty, according to the Columbia analysis.
“Cutting child poverty by that amount represents the largest reduction in recent history,” Megan Curran, a Columbia researcher who co-authored the study, said of any prior year-over-year reduction in child poverty.
