coronavirus stimulus

Will We Get a Second Round of COVID-19 Stimulus Checks?

Will another check soon be in the mail? Photo: Eric Gay/AP/Shutterstock

For many Americans who haven’t lost jobs or don’t own businesses, the central feature of the CARES Act — passed in March to offset the economic effects of the coronavirus pandemic — was the $1,200-per-person payments it authorized. Since the economic crisis has not gotten visibly better and the “reopening” of businesses is at most partial and perilous, there’s been talk (particularly among Democrats) of a second round of stimulus payments. Though a smattering of eligible taxpayers never received their first check, there is understandably considerable interest in whether the federal government might provide more relief to individuals. Here’s the situation as it stands, with Congress in recess until July 20 and pressure building for another coronavirus stimulus package.

What Happened With the First Round of Stimulus Checks?

As my colleagues Eric Levitz and Adam K. Raymond explained,
the IRS (which Congress put in charge of the payments) was instructed to make approximately 150 million payments. The amounts varied depending on income and number of children in the household. Those earning up to $75,000 — or $150,000 for married couples — got the full check; partial payments were available to individuals earning up to $99,000 or couples earning $198,000. Parents received an additional $500 for each dependent child.

People who had already given the IRS direct-deposit bank information received the first payments; instead of a paper check, they got a direct deposit. It was tougher for others, which is why some eligible people waited a long time on paper checks – or in some cases, debit cards – in the mail.

What Are Democrats Proposing for a Second Round of Payments?

House Democrats proposed a similar second round of stimulus checks in the so-called Heroes Act they passed back on May 13. The income thresholds and individual check amounts ($1,200) were the same, but the payment for dependent children was boosted from $500 to $1,200, up to a limit of three. So a two-parent family with three kids and income under $150,000 could receive total payments of $6,000 ($2,400 for the parents, $3,600 for the dependent children).

The bill doesn’t change the way the money is distributed, so if it becomes clear that a second check is in the works, it would be a good idea to send the IRS your banking information to ensure a quick payment.

The overall Heroes Act authorizes an estimated $3 trillion in new spending, with a third of that being devoted to assistance to state and local governments experiencing dire fiscal conditions due to falling revenues and rising demands for services.

How Did Republicans React?

Senate Republicans, who don’t want to give the impression that they have to negotiate over House Democratic proposals, have largely dismissed the Heroes Act as a “liberal wish list” or as a “political messaging bill” not seriously intended to go anywhere. But their criticisms have mostly focused on the overall $3 trillion price tag, provisions for aid to state and local governments, and an extension of the $600 federal unemployment insurance add-on until the end of the year.

More generally, many congressional Republicans and conservative opinion leaders have argued for a “pause” in stimulus efforts until the $2.2 trillion authorized by the CARES Act is fully distributed and states are given the opportunity to reopen businesses. They also are very focused on providing corporations with a liability shield against coronavirus-related lawsuits and damage claims. In line with the president’s shift toward demanding “reopening,” his supporters in and beyond Congress have focused on easing of restrictions on businesses rather than federal stimulus as the key to economic recovery, though more recent coronavirus spikes may be beginning to change that dynamic.

Some congressional Republicans would clearly prefer to avoid a costly second stimulus check, but with the Trump administration signaling its interest in another round of checks (see below), GOP leaders have shifted tactics to an emphasis on holding down the overall price tag of a future stimulus bill. As early as mid-May, Mitch McConnell began promoting the idea of a $1 trillion “cap” on any future stimulus bill, an idea that may be arbitrary but that seems to have caught on among Republicans who aren’t opposed to another stimulus bill.

Among senators of both parties, support for more narrow targeting of a second stimulus check is becoming more commonly heard:

Sen. Ben Cardin (D-Md.), a member of the Senate Finance Committee, said he wants the next round of coronavirus relief to be more focused on the households that have been hardest hit by the economic downturn brought on by the pandemic….


Cardin said the direct payments made more sense in March when Congress wanted to get money out the door as quickly as possible. But now, as states are allowing businesses to reopen around the country, he says lawmakers should look at who will most need relief in the coming months.

Most recently, McConnell has been talking in terms of a $40,000 income cap for eligibility for a second check, as compared with the $75,000 limit (with some phased-out assistance available above that level) on the first check. According to one estimate, that would keep 20 million Americans who received the first check from qualifying for a second.

Where’s Trump on New Stimulus Efforts?

Trump and his staff have been less enthusiastic about stimulus checks than Trumpian favorites such as a payroll tax cut, but the president himself seems to understand politically that regular folks need to be cut in on any new stimulus deal. In mid-May the president himself said “I think we are going to be helping people out,” and “getting some money for them.”

In the wake of the surprisingly strong May jobs report, Trump briefly talked about the economy recovering “like a rocketship,” and another upbeat jobs report in June buttressed Republican hopes that little or no immediate stimulus would be necessary. But the more recent spike in COVID-19 cases centered in states that had reopened businesses quickly, and the return of business restrictions and stay-at-home orders in many states, have dampened economic optimism, even as the president’s sinking reelection prospects are giving fresh impetus to the idea he needs to identify with calls for additional relief to individuals.

On June 22 Trump answered a question about a second stimulus check affirmatively if vaguely, and then the Washington Post suggested the White House was divided on the subject:

President Trump has told aides he is largely supportive of sending Americans another round of stimulus checks, expressing the belief that the payments will boost the economy and help his chances at reelection in November, according to three people aware of internal administration deliberations….


Internally, the president’s advisers and allies are split. Treasury Secretary Steven Mnuchin has advocated sending another round of checks, two people with knowledge of internal deliberations said…


Larry Kudlow, director of the White House National Economic Council, is skeptical of sending payments out to as many people who received them in the first round…. Kudlow said Tuesday the administration may want to send payments primarily to those who need them most, rather than the nearly 160 million Americans who received the first round.

At the moment Mnuchin appears to be in charge of negotiations over the next stimulus measures, which makes a second stimulus check significantly more likely.

What’s the Timetable For Negotiations To Take Place?

Senate Republican leader Mitch McConnell has made it clear that he wants to develop a GOP position on additional stimulus efforts with the White House before any negotiations with Democrats take place, but obviously at some level a back-and-forth will develop once Republicans become satisfied they’ve trashed the Heroes Act enough. Best as we can tell, intra-GOP talks are beginning to take place now, and will become more formal when Congress returns on July 20.

Whether they move more quickly or slowly after that will likely depend on economic news as it happens, and whether it’s bad enough to convince the White House and congressional Republicans that they cannot count on business reopenings boosting the economy — or the president’s prospects for reelection — any time soon.

A second variable is whether Republicans and Democrats generally stay focused on areas of agreement (potentially the second round of stimulus checks) or disagreement (again, Democratic demands for large-scale aid to state and local governments, Republican demands for corporate protections, and the red-hot dispute over the continuation and amount of subsidized unemployment benefits due to expire on July 31).

And a third factor is the overall climate for any sort of bipartisan action, which is currently being complicated by the the president’s law-and-order campaign against national protests that began with George Floyd’s killing in Minneapolis, and his general shift into campaign mode.

If there is going to be another stimulus package, it needs to be wrapped up before Congress’s next lengthy recess, currently scheduled to begin in early August.

What’s the Likely Outcome?

Disagreements between the two parties over the size and shape of coronavirus stimulus legislation are sharp enough to slow down negotiations, once they begin. If you are counting on a second check, keep an eye on economic news. If unemployment rates continue to come down and general economic activity revives, pressure for new stimulus — particularly the individual payments that most people in both parties supported in the past — may dissipate. But if the coronavirus spikes continue or intensify, and reopening efforts stall or reverse, some immediate action will likely prove necessary, with a second stimulus check being relatively high on the list of items both parties want.

So long as Mnuchin is the chief negotiator for Republicans, a second check – probably in roughly the same amounts as the first – is more likely than not, though restricted eligibility is also probable in order to hold down overall costs. The more often McConnell’s $40,000 income cap figure is repeated by other Republicans, the more you can count on that being the limit on eligibility. Should some other Republican figure displace Mnuchin (e.g., Vice President Pence) in the negotiations, it all gets iffier. But if Trump himself gets panicky about his odds for reelection, almost anything could happen.

Will We Get a Second Round of COVID-19 Stimulus Checks?