The End of the “Big Government Bad” Era

After a marathon Senate session full of gut-wrenching twists and turns, the Senate has finally passed Biden’s enormous America Rescue Plan with many of its original proposals well intact. 

Given its $1.9 trillion price tag, the bill is one of the most ambitious in modern American history. Democrats have finally gone big in delivering economic relief for the country — something that hasn’t been done since the Great Depression.

But let’s get into the details of the bill. What makes it so great? And why is it a monumental moment in American political and economic history?

Senate Democrats celebrating the passage of the American Rescue Plan Act.
(AP)

Perhaps the most notable portion of the bill is that it sends another $1400 into the pockets of millions of working-class Americans across the country. Adult dependents, who have been completely left out of the first two rounds of stimulus payments, are finally included under Biden’s bill. Despite petty criticisms of the stimulus not being exactly $2000 or the bill taking too long to pass, this portion of the bill will be very well-received amongst the American public.

A significant but largely slept-on feature of this bill is the new child allowance program which basically acts as a mini-UBI for millions of families across the country. Instead of an annual child tax credit of $2000 for dependents under the age of 16, parents will now be receiving monthly payments of $300 for each child under the age of 5 and $250 for each child between the ages of 5 and 18. The expanded eligibility and overall increase in child benefits are projected to slice child poverty in half. Although the policy is currently temporary, there is intent to make it permanent. And it will be difficult for Republicans to challenge a popular policy.

Protesters demanding an end to childhood poverty.
Source: https://www.childrensdefense.org/policy/policy-priorities/child-poverty/

The unemployment checks will be extended all the way through September, an enormous relief for millions of currently unemployed Americans whose benefits were set to expire this month. This part of the bill faced serious danger given last-minute objections raised by conservative Democrat Joe Manchin. In a minute concession, the weekly UI benefit was dropped from $400 to $300, but the benefits will remain active throughout the summer.

Over $350 billion dollars of relief will be sent to states and cities that have been forced to make extremely difficult budgetary decisions throughout the pandemic. $170 billion have been allocated for the necessary supplies to allow schools to reopen safely across the country, $100 billion for accelerated vaccine rollout, testing, and contact tracing, and $27 billion dollars for rental assistance. To put the size of Biden’s bill into perspective, just these four features are almost as much as Obama’s stimulus during the 2008 financial crisis!

Credit: @Noahpinion on Twitter.

The bill also includes a variety of other important programs and reforms that certainly deserve their own blog post. But let’s stay focused on the big stuff for now.

Almost every single policy in this bill is laser-focused on the lower and middle-class of the country. But most importantly, it goes big. It is projected to bring us back on our pre-pandemic growth trend much quicker while alleviating many of the struggles working-class families have been facing throughout the pandemic. The impact of Biden’s American Rescue Plan will be felt by ordinary Americans across the country, which means it will likely carry significant political consequences.

Many have been predicting an end to the government-phobia era that has plagued our politics for decades. With progressive ideas gaining serious political momentum, it finally seemed that our political spectrum was being pushed to the left.

Despite this innate hope, I remained conservative about the chances of a political transformation that could set us on track to catch up with the rest of the developed world in terms of social and economic policy. Without the passage of any significant legislation, how else could Americans get a taste of the policies that progressives and even some moderate Democrats claimed would dramatically improve their lives?

I believe this bill does just that.

Many Americans claimed to have voted for Joe Biden just to remove Trump from office. With the passage of this bill, many of those skeptical about the potential of a Biden presidency will certainly get more than they originally anticipated. That does not even mention the millions of Americans who, regardless of political affiliation, may come to the conclusion that their government is actually there for them, leading them to ask for more.

Hundreds of people lining up to vote in Marietta, Georgia. Record voter turnout in Georgia made Biden’s stimulus plan (and this blog post) possible. Thank you, Georgia.
(AP Photo/Ron Harris)

If Democrats get approval from the American people through a decisive victory in the 2022 midterms, it could very well encourage them to finally smite the filibuster and start pushing for more ambitious public policies — giving rise to a social democrat movement in American politics that millions have been yearning for.

Of course, this is all speculation. We will simply have to wait in order to witness the true economic and political impact this historic piece of legislation will have. However, if American history tells us anything, it is that once people get a taste of the government acting in their economic interest, they will continuously vote for those policies — even if that means re-electing a president three times.

Title Image: Matt Rourke / AP file

About the author

Damjan Nastic

Hello, and welcome to my blog! I'm Damjan Nastic, an economics major aspiring to encourage democratic participation amongst my fellow students through this page. I hope my page can offer a different perspective on pressing issues throughout the world.

If you have any questions, please feel free to email me at [email protected]!

Thank you.

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