American Rescue Plan

American Rescue Plan Act of 2021

The American Rescue Plan Act of 2021 (ARPA), signed into law on March 11, 2021, by President Joe Biden, is a $1.9 trillion economic stimulus bill passed in response to the ongoing COVID-19 pandemic. The legislation aimed to facilitate the United States' recovery from the economic and health effects of the COVID-19 pandemic and the ongoing recession.

Background

The COVID-19 pandemic, which began in late 2019, led to a global health crisis with significant economic repercussions. In the United States, it resulted in widespread job losses, business closures, and a surge in healthcare needs. The American Rescue Plan was proposed by President Biden shortly after taking office, with the goal of speeding up the country's recovery process.

Provisions

The American Rescue Plan includes several key provisions:

• Direct Financial Assistance: The plan provided $1,400 direct payments to individuals making up to $75,000 annually, and couples making up to $150,000, plus $1,400 per dependent.
• Unemployment Benefits: It extended unemployment benefits, including a $300 weekly federal unemployment supplement.
• Child Tax Credit: The legislation expanded the Child Tax Credit (CTC) and made it fully refundable for the year 2021.
• Education Funding: ARPA allocated funds to support the reopening of schools and universities, including money for ventilation system upgrades and reducing class sizes to meet social distancing guidelines.
• State and Local Government Support: It provided financial support to state and local governments to mitigate the fiscal effects of the pandemic.
• Vaccine Distribution and COVID-19 Testing: The plan included funding for vaccine distribution, COVID-19 testing, and contact tracing efforts.
• Small Business Support: ARPA allocated additional funds for small businesses, including grants and loans through the Paycheck Protection Program (PPP).

Impact

The American Rescue Plan has been credited with providing critical support to millions of Americans and aiding in the economic recovery. The direct payments and unemployment benefits helped stabilize household incomes, while the expanded Child Tax Credit is expected to significantly reduce child poverty. The funding for vaccine distribution contributed to accelerating the COVID-19 vaccination campaign across the country.

Criticism

The American Rescue Plan faced criticism, primarily from Republican lawmakers, who argued that the package was too large and included measures unrelated to the immediate COVID-19 crisis. Concerns were also raised about the potential for the plan to contribute to inflation.

See Also

• COVID-19 pandemic in the United States
• Economic impact of the COVID-19 pandemic
• CARES Act
• Consolidated Appropriations Act, 2021