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Zero Republicans Vote for Stimulus Projected to Raise 16 Million Out of Poverty

Provisions like the expanded child tax credit and $1,400 relief checks will help the most, says the Urban Institute.

House Minority Leader Kevin McCarthy looks on in the House chamber during a reconvening of a joint session of Congress on January 6, 2021, in Washington, D.C.

A new report has found that the American Rescue Plan, which passed the House on Wednesday and is expected to be signed into law by President Joe Biden on Friday, will sharply reduce poverty in the country, especially among Black and Latinx people.

The report, by D.C.-based think tank the Urban Institute, finds that the $1.9 trillion stimulus will reduce the projected poverty rate for 2021 from 13.7 to 8.7 percent overall. It will also shrink the racial poverty gap by reducing poverty among Black and Latinx people by 42 and 39 percent, respectively, the report says.

The economic impacts of the pandemic have hit Black and Latinx people especially hard, more so than other racial demographic groups. And, as the economy has bounced back over the past months, Black people have not bounced back as much, following the pattern of the fallout of the 2008 recession that left Black households in the lurch for over 10 years.

The American Rescue Plan, in combination with previous stimulus packages, could also cut the share of people experiencing deep poverty, or people earning under 50 percent of the poverty line, by a third, the Urban Institute report finds.

The provisions with the biggest impact on reducing poverty, say the report’s writers, are the additional unemployment checks, the extension of food stamp benefits, the $1,400 relief checks and the new expanded version of the child tax credit in the bill.

Biden’s stimulus package will also be particularly good for children, the report finds, reducing the poverty rate for children by more than half in 2021. This is in large part due to the expanded child tax credit in the bill, which expands upon the existing child tax credit by offering parents up to $3,600 per child over the next year in the form of monthly payments.

The report’s findings bolster previous reports which have also found that the expanded child tax credit could play a massive role in lowering child poverty, and poverty in general. This includes a Columbia University analysis, which found that the bill will cut child poverty by half (though the Columbia report also included several provisions like the minimum wage raise that didn’t make it into the final package).

The House passed the bill Wednesday afternoon, and the White House said that Biden will sign the bill on Friday afternoon, two days before key unemployment benefits from the last bill expire. The package passed the House and the Senate with zero Republican votes as Republicans united against the bill.

Though Republicans oppose the bill, the legislation and its policies enjoy overwhelming bipartisan support among the public. A new poll out Wednesday conducted by CNN finds that 61 percent of Americans support the bill overall. The poll also finds that 85 percent of those polled support the bill’s provisions to expand tax credits, including 95 percent of Democrats and 73 percent of Republicans — a far cry from the 0 percent buy-in from congressional Republicans.

The CNN poll of 1,009 people also finds a 55 percent majority support for the $15 minimum wage proposal that didn’t make it into the final bill.

Though the bill doesn’t include the vaunted progressive goal of raising the minimum wage, the American Rescue Plan does include provisions that have earned progressive praise. “Because of [the progressive movement’s] support, the U.S. Senate … passed the most comprehensive pro-worker piece of legislation in the modern history of our country,” said Sen. Bernie Sanders (I-Vermont).

Progressives in the House have also celebrated the package, which Rep. Pramila Jayapal (D-Washington), the head of the Progressive Caucus, called in a statement, “a truly progressive and bold package that delivers on its promise to put money directly in people’s pockets.”

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