NASHVILLE, TN – The American Rescue Plan Act, which Democrats passed without a single Republican vote, gives $1400 to most Americans, increases funds for food stamps (SNAP), makes health coverage cheaper and more accessible, provides housing assistance and funds to address homelessness, money for homeowners and renters to avoid foreclosure and eviction, money for schools, and funds to state and local governments.

It is a very big bill. How big? One trillion dollars is a million dollars multiplied by a million. That’s a thousand billion. $1.9 trillion is $1,900,000,000,000. As Congressman Jim Cooper (D, 5th District) told reporters last week, the Rescue Act is a gargantuan bill. (See Cooper)

Representative Raja Krishnamoorthi (D-Illinois) went to the mat with Republicans who didn’t want to give states and local governments relief funds.

“It’s a game changer. This package of measures will help our economy heal and, of course, help America heal from the healthcare crisis. I think it’s a big big win for the American people, ” said Congressman Raja Krishnamoorthi, (D-Illinois).

He said President Biden tried to get Republican input and support for the bill but there was “no meaningful exchange of views”. Republicans were stubbornly ideological in their approach rather than practical.

“One of the deal breakers for Republicans, if you will, was to include state and local aid in the package and of course, that’s my baby, that’s the issue that I have been championing. I got to tell you that is a deal breaker for us not to be included,” Krishnamoorthi said. Many first responders are among the 1.4 million government workers who have been laid off since last March.

“In my own district, I have Republican mayors who are contacting me basically saying ‘look we need the revenue. We need a way to avoid laying off further police and firefighters. And what you did in Washington was terrific but can you do more?’

In other words what we did in Washington this past week was tremendous but there are even Republican mayors of jurisdictions who don’t think it’s enough. So this is not a blue issue versus a red issue. This is an American issue,” he said.

“Republican just say ‘No’ but take the dough,” Krishnamoorthi said. Although red states could refuse the aid, he predicted they would accept the relief money.

The act did not raise the minimum wage, offer debt forgiveness to students, tackle immigration reform, or the fund the country’s infrastructure needs.

Chad Stone is chief economist at the Center for Budget and Policy Priorities, a nonprofit research institute in Washington.

According to Chad Stone, an economist with the Center on Budget and Policy Priorities, the plan addresses three issues: first, getting the virus under control; second addressing and relieving the hardship and uncertainty millions of Americans are suffering which would have gotten even worse without it, and third, it provides substantial stimulus to an economic recovery that has stalled only halfway back to full employment.

“Programs that relieve hardship and give money to people who will spend it quickly like unemployment insurance and nutrition assistance have a high bang for the buck in stimulating economic activity and jobs,” Stone said.

He published a paper this month arguing that the official 6.3% unemployment rate understates job losses due to the Pandemic. He said private and government employers have 10 million fewer workers than they did this time last year. He said the actual unemployment figure is somewhere between 8.3%-10%.

“Job creation stalled in the second half of the year and job losses remain particularly large in industries that pay low wages. Workers of color, those without a bachelor’s degree, and immigrants have experienced disproportionate job losses. Women have fared worse than men, and mothers of school-age children have been more likely than fathers to drop out of the labor force to meet caregiving responsibilities,” Stone wrote.

“The common thread of these problems is a lack of cash. People need unrestricted funds to get caught up,” said Elaine Maag, a senior researcher at the Urban Institute.

Elaine Maag, an Urban Institute researcher, said the rescue act would have a big impact on low-income families. She said the stimulus checks and the increase in the child tax credit would lift half of the country’s poor children out of poverty.

“These are both cash benefits that affect a very large share of low-income families,” Maag said.

Prior to the pandemic the overall poverty rate in the U.S. was 11%. She said without the American Rescue Plan the poverty rate in 2021 would rise to 14% but that number hides some important differences.

“While White families were projected to have a poverty rate under 10%, Black families were projected to have a poverty rate of 18%, and Hispanic families were projected to have a poverty rate of 22%,” Maag said. The rescue package would cut those numbers to 6.4%, 10.5%, and 13.3%, respectively.

Children under 18 would benefit most from the plan. It would cut the poverty rate for children from about 14% to about 7%. “In other words, the law would cut the poverty rate of children in half,” Maag said.

The full picture is still pretty grim. Maag said food insecurity has nearly doubled since the pandemic began. Surveys show one quarter of families with children are not eating well or skipping meals because there is not enough money for food. Four in 10 Hispanic and Black families report they are food insecure. Maag said about 17% of renters are behind on rent, which is about triple the typical rate.

“The common thread of these problem is a lack of cash. People need unrestricted funds to get caught up,” she said.

Maag said the law is so effective for families with children because the stimulus payment and tax credit go to almost every child, although undocumented children are excluded.

Unlike previous stimulus checks that only went to adults, children will also get $1400. There are significant changes to the child tax credit as well. Normally, a child tax credit could reduce your income tax by $2000 but only if you earned at least $2500 in wages. Last year, many low-income families only got a credit of $1400 per child.

Last year the Tax Policy Center estimated there were 27 million children under age 17 living in families that received less than the $2000 per child credit because their parent didn’t earn enough to qualify for the benefit.

President Biden’s rescue plan expands the child tax credit in four ways: first, the credit is fully refundable. “Families will receive the full value of the credit, even if they didn’t work. That’s the most import piece of the law for low-income families,” Maag said.

Secondly, the credit will now include children who are 17. They currently qualify for a much smaller credit. Thirdly, the maximum credit will increase for most families from $2000 per child to $3600 per child for kids under age 6, $3000 per child for kids ages 6-17.

Lastly, the credit will be delivered as an advance payment. Families will not have to wait to receive their child tax credit until they file their tax returns. Payments will start being delivered as early as July and you can receive up to half of the credit before you file your Form 1040.

“For families that are in in the bottom 20% of the income distribution, they will  receive an additional $3,780 on average,” Maag said.

This story was brought to you by the Blue Cross Foundation of California and Ethnic Media Services.