If he’d known the $1,200 stimulus check he received last April would be the only assistance for more than eight months, Corbin Onorato might have tried to stretch it a little further.
Onorato, 31, is a long-haul truck driver who moved to Bath from Southern California not long before the pandemic hit. He lives with his girlfriend, who lost her job and hasn’t found another. His income, which is about $4,500 per month when he’s on the road, supports them both. His biggest bills are $1,500 for rent and utilities and food, but he also has to pay travel expenses when he’s hauling, sometimes for a couple months at a time. He ends up with a little money leftover each month, but that usually gets drained when he’s not on the road because he’s not earning income.
“We’re scraping by, you know,” he said. “Just enough for rent and bills really.”
The passage of a relief bill in late December that provided another $600, Onorato said, felt like “a slap in the face.”
“I didn’t even get it in time to buy Christmas presents for anyone,” he said.
Congress is preparing this week to take up yet another spending package – the first under President Biden – to boost the economy as the coronavirus pandemic wears on. A lot of attention has been devoted to individual stimulus payments, especially after the final six months of 2020 saw 8 million Americans fall into poverty.
Rep. Chellie Pingree of Maine, D-1st District, said she’s heard from more than 200 constituents like Onorato just since the end of December about their struggles and need for assistance. In an interview this week, she said billions and billions have been spent over the last year to help businesses, but far less has gone to struggling individuals or families.
“Unfortunately, over the years, some of my conservative colleagues have developed this suspicion of people who are poor,” Pingree said. “I think it’s become a knee-jerk reaction to say they can’t be trusted with this money.”
Any bill is certain to include at least some money for individuals. Biden has proposed $1,400 payments for people making less than $87,000. A group of 10 Republican senators, including Susan Collins of Maine, has suggested $1,000 payments to those making $50,000 or less. The income threshold for payments under last year’s CARES Act was $75,000 for individuals.
Pingree is among more than 50 Democratic House members who support not just another one-time payment to individuals, but recurring payments until the pandemic is over. That options seems unlikely to garner enough support.
“That provides not only dignity but predictability,” she said. “We know this isn’t going to go on forever, and there are ways to structure it to those who need it most.”
Older Mainers who live on a fixed income, but who have seen their expenses rise are among the most vulnerable.
Nola Denslow is 84 and lives alone in Harpswell. Her home is paid for, thankfully, but her monthly budget is about $950 per month and things have been tight.
“Most of it is food – I’ve probably doubled what I spend on food,” she said.
Before the pandemic, Denslow used to shop around for the best deals. Now, for safety reasons, she orders groceries for curbside pickup and household goods on Amazon. She didn’t have a cellphone, though, and needed to buy one so that she’d have a way to call the store when she was ready to pick up her food.
“It’s just a TracFone,” she said, referring to a brand of prepaid cellphone. “But I feel it every month.”
Denslow used to budget for gifts for family members and for entertainment but hasn’t been able to do that.
“When I got my $1,200 check and then the $600 check, well it was euphoria because it was going to do so much,” she said. “Now, of course, it’s gone.”
The debate over whether to distribute money directly to Americans tests the morality of capitalism during a pandemic, particularly since wealthy people have been unscathed or in many cases have actually seen their wealth rise. A report published last month by progressive groups, including the Institute for Policy Studies and Americans for Tax Fairness, suggested that U.S. billionaires have gained $1.1 trillion, about 40 percent, in wealth since mid-March last year. Much of that has been driven by a hot stock market that doesn’t benefit many Americans.
There also are lessons from the 2009 Recovery Act passed during the early part of former President Barack Obama’s first term. Looking back, many economists now agree that it fell short in delivering relief to everyday Americans and favored corporations. And stimulus checks are popular. A Yahoo News survey released Tuesday showed that 74 percent of respondents supported relief payments of $2,000, while just 13 percent were opposed.
There are correlations between providing more assistance to individuals and lower rates of COVID-19 transmission and deaths. Perhaps the best example is Canada, which delivered individual payments quickly, enabling its citizens to shelter in place more easily. Canada has seen 20,600 COVID-19 cases per million people, about one quarter of the United States’ rate, and 530 deaths per million people, compared to 1,362 per million in the U.S.
Still, some feel that if the government is giving away money, it needs to target only those in need. As part of the $2.2 trillion CARES Act last year, billions went to Americans who never lost income, as well as businesses that were not affected adversely by the pandemic. Part of the reason for that was to get money out quickly and broadly to avoid further economic collapse during the early stages. But for low-income individuals and families, the relief brought by the CARES Act was gone in a couple months.
Kent Ritchie, 59, of Freeport was forced to retire early because of a disability. He lives on his Social Security, which is about $1,800 per month, and a small pension fund. After his rent, utilities and food, that doesn’t leave much.
“I wasn’t really making enough to get by before and (the pandemic) hasn’t made things better,” he said.
He hung onto the stimulus check from last spring as long as he could. He referred to it as his “survival fund.” Now, it’s gone.
“Health-wise, I’ve got pretty good insurance through Medicare,” Ritchie said. “But if my car died and I couldn’t afford to fix it, I’d go nuts.”
His car, he said, has been keeping him sane over the last several months. Sometimes, he’ll drive just to sit in the parking lot at Dunkin’ and listen to sports talk radio. He also uses it to visit his parents, who are 88 and 85 and live in Greenville. He hasn’t gone to see them in person out of fear he might accidentally bring COVID-19 with him, but they meet once a month or so in a parking lot in Waterville or Newport, about halfway between their homes.
His parents are on fixed incomes, too, Ritchie said, and would benefit greatly from another stimulus payment.
“I think they’ll probably pass something,” he said of Congress. “They’ll hem and haw for a few more weeks first.”
The biggest debate in the latest spending bill could be over the income threshold for the next round of individual payments. Pingree said she’s in favor of structuring it so that the neediest individuals benefit most, but she said an important point to consider is that stimulus checks are based on the most recent tax information available, which is the 2019 year. If someone lost their job in 2020, or saw their hours or wages decrease, that wouldn’t be factored in.
Pingree also said there is value in distributing money to the next tier of middle-class earners, too. If the goal is to help stimulate the economy, those people will be in the best position to spend.
“My worry is every time we start to get too far into the weeds, we end up waiting months and months,” she said. “People are struggling now.”
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