Stimulus checks, one of the primary ways the US Government battled the COVID-19 crisis, are on the horizon yet again. This controversial method had been implemented to ensure the lock down policy would be supported by the majority of US citizens.
Another stimulus check is in discussion to throw into the fire of the ongoing crisis. Will it help to slow down inflation or only accelerate it? Time will tell. It is a good opportunity to learn about stimulus packages, their history, and the direction they may guide us. This knowledge can also help with pay transparency on https://businesspartnermagazine.com/pay-transparency/ and financial planning in 2023.
The first stimulus package dates back to the Great Depression (1933-1936). New Deal program passed these years was aimed to provide jobs for the unemployed. Government bills at the time focused on bridge, road, and dam construction projects. To improve local infrastructure and provide locals with reliable jobs. The stimulus checks concept as people know it today was formulated in 2001. They were first used during a small recession of the US economy in 2001.
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What Is A Stimulus Check (With Examples)
Enough with history lessons, let us focus on the stimulus checks in the present! A stimulus check is a sum that the government pays to its citizens. It can be in a form of a one-time payment or a monthly one. Received straight onto your banking account or in cash. Digital technologies help US citizens to learn about the stimulus details in an instant.
Let us review some of the more recent examples mentioned at the beginning of the article. In comparison to the first CARES stimulus checks In December 2022, 19 states sent out money as stimulus checks. Full state payments:
- Alaska — $3,284;
- California — $1,050;
- Maine — $850;
- South Carolina — $800;
- Colorado — $750;
- Oregon — $600;
- Massachusetts — 14% Tax Rebates.
These examples were chosen in order to tell about the payment system in greater detail. For example, people living in Alaska had annual payments before COVID-19. They are coming from Permanent Fund Dividend program.
On the other hand, California had a modular payment system. What is counted into final sum calculations:
- yearly income;
- qualifying dependants;
- family status.
$1,050 in the list is the maximum amount of money you can receive from the state of California. You have to be in relationships, make less than $75,000/year and have a dependent.
Massachusetts chooses a progressive scale for its stimulus check. Citizens will receive 14% of the taxes paid to the state in the past year. Some of the locals may receive payments close to the ones in Alaska, making the state more appealing to the middle class.
Known Drawbacks Of Stimulus Checks
While most of the recent studies show only the brighter side of stimulus checks, it would not be fair to list some of the downsides. Moreover, more and more people are blaming them for the current inflation crisis. Single payments to boost the economy can miss the mark if people will decide to hoard the money instead of spending it. And this result is more likely to await us. When people are not sure about the future, they are less willingly to spend free cash from the state. Keep it in mind while voting for stimulus checks next time.