With millions of Americans likely to lose their jobs or see their incomes plummet as a result of the Covid-19 outbreak, the Trump administration and lawmakers from both parties have proposed to soften the virus’s economic blow by providing cash assistance directly to U.S. households. Treasury Secretary Steven Mnuchin laid out further details of the administration’s plan on Thursday, saying that it would provide for payments of $1,000 per adult and $500 per child in three weeks and another round of payments at the same level three weeks later.
Direct cash assistance is the fastest and surest way to protect Americans from the economic fallout of Covid-19. But the devil is in the details, and the cash aid proposals unveiled in response to the virus all have features that will make the schemes unnecessarily difficult to implement. Moreover, several of the plans — including the administration’s emerging proposal — unduly discount the needs of families with children.
A better approach would be to provide a uniform amount — we suggest $500 a month — to every adult and child in the United States as long as the crisis persists. A steady stream of monthly payments will ensure that almost all households can continue to meet their basic needs even if the recession caused by Covid-19 lasts a year or longer. And a uniform amount — $500, regardless of age, income, or other characteristics — will guard against the administrative complications that come with variable payments.
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