If you read the news, you may have heard rumors of the US government giving another stimulus check-in in 2022. But what would this mean for American households, and what will happen if there actually is a 4th stimulus check?
The 1st Stimulus Check was sign by Pres. Obama on February 17, 2009
$787 billion – targeting unemployment and economic growth. The 2nd Stimulus Check was sign by Pres. Obama on February 13, 2010: $831 billion – targeting unemployment and economic growth. The 3rd Stimulus Check was sign by Pres. Obama on December 31, 2010: $618 billion – targeted to employ men and women who are out of work, assist homeowners affected by the threatened foreclosure crisis, help states avoid deep cuts to essential services, and for other purposes.
The 3rd Stimulus Check was sign by Pres. Obama on January 28, 2011
Stimulus Check 3.0. What will happen with Stimulus Check 4.0 and when might it be releas? Nobody knows for sure but we may have some clues from past history and what government officials are saying today. In any case, we can explore potential scenarios or talk about what we’re likely to see next and where that would take us on our path to economic recovery.
A 4th Stimulus Check might arrive in 2022?
Many people are wondering what will happen if and when another 4th Stimulus Check arrives. Most of us assume that we have to wait until 2027, but most economists believe it could arrive as early as 2019 or 2022. So, at what point should you expect to receive your next stimulus check? How long might you have to wait for it? You might be surprised! We’ll review some possibilities for how long you may be without a Stimulus Check and where we’re headed after our 2nd Stimulus Check-in 2017. If there is another Stimulus Check in our future, will it arrive soon or late?
4 Reasons why the next Stimulus Check would make sense
First, US GDP growth has been steadily climbing (now averaging 2.2% per year since 2010, after annual GDP growth rates below 1% over 2007-2009). Second, unemployment is currently at 5.5%, which means that it’s unlikely to fall much lower, given that historically unemployment has come down faster than GDP. That indicates potential remaining slack in our labor market and that we’re not yet operating close to full capacity. Third, poverty remains stubbornly high relative to pre-Great Recession levels (see chart above). Fourth, consumer and business confidence have finally returned to pre-recession levels.
Possible date when this could happen
January 2023 or January 2024. Economic history suggests another recession around that time, and while it won’t be the next recession, it could have similar results to what happened with the 3rd stimulus checks. For example, early reports show that while they helped get people through hard times, they didn’t necessarily help end them; long-term unemployment remains high. An increasing number of people have stopped actively looking for work as unemployment compensation runs out (or never started). Critics contend that these checks are little more than welfare payments and politicians are worried that checks could last too long; paying indefinitely often creates unintended consequences like reduced job opportunities and rising costs for state programs as recipients rely on them for longer periods.
Details about the possible fourth stimulus check
From January to December 2013, a payroll tax reduction was given as an economic stimulus, and extended unemployment benefits were also provided. More Americans moving into work has led to discussions of other ways to help boost income levels. Under consideration are reforms of Social Security and Medicare. With particular emphasis on increasing the social security retirement age and slowing cost-of-living increases for upper-income seniors. These changes would give individuals lower taxes over time but lessen their future benefits from social security or medicare. Other options discussed are helping businesses with capital gains tax breaks for investments or allowing companies that bring foreign profits back into America to avoid paying taxes on that income indefinitely.