Dissecting the First Stimulus Package

The coronavirus has put a massive strain on the U.S. economy, and our markets have been pricing in a recession (economic contraction two quarters in a row) ever since. Being hyper-partisan, our current government has struggled in the past to agree. This makes the 2 trillion dollar stimulus package look like a pleasant surprise. The relief package is the "largest emergency aid package in U.S. history," says CNN. Currently, we are five weeks into the pandemic as a country, and over 26 million new unemployment cases have now been filed. If you were to get rid of COVID-19 and think about the average worker before this crisis arose, most were living paycheck to paycheck. Furthermore, you can only imagine that if they were to lose their job with no new income, they would quickly run out of funds. The stimulus package includes that adults will receive a one-time check for $1,200 if they have an income under $75,000. A couple making $150,000 or less will receive $2,400. Taxpayers filing as head of household would get the full payment if they earned $112,500 or less. While the intention of the stimulus package is to ease financial pressure on the American people, this package might not be enough. According to Statista, the average rent in the U.S. is 1,471 U.S. dollars a month. While this one-time payment may only prove to be a short-term fix, it does offer extreme benefits for the unemployed. This includes an additional $600 per week for the following four months after filing unemployment. On the flip side of the stimulus package, there is compensation that is heading towards corporate America in the form of a Slush fund which takes up 500 billion of the stimulus package. An in-depth look at the allocation of this fund will show that 50 billion went to bailing out Airline companies. Many people are upset that the Airline industry is receiving government support as it has spent 96% of its cash on stock buybacks over the past decade, which at a closer look only benefits the shareholders and has been thought to aid "increased income inequity, employment instability, and anemic productivity." Keeping the Slush fund in mind, let's address funding for hospitals that goes towards supplies like beds, masks, gowns, faceguards, disinfectants, etc. The stimulus package allocated a bit more than 1/5 as much as the slush fund was given, coming out to 117 billion in necessary funding. While the stimulus package attempts to get money straight to the Taxpayers, it may only prove to be a short-term fix, not giving sufficient funds to cover their costs. The government continues to push the idea of the trickle-down effect through the slush funds with no authority or oversight for where the funds are heading.