I Think This Will Be in the Next Stimulus Package

This is my stimulus update for Saturday, May 2.

Senate is back in session on Monday, and we need to talk about Mitt Romney and Chuck Schumer, because I am fairly confident that we’ll see what they’re talking about included in the next stimulus package if there is one, which I think there will be.

But first let’s talk about our channel polls.

Most recent poll, and this was for Social Security Retirement, SSDI, and Railroad Retirement beneficiaries only, it looks like of those 10,000 of you who have responded, 41% have received in a correct amount and 51% have not yet received with 3% in an incorrect amount and 5% not eligible.

So that’s good news for a lot of you, a lot of you have received by the end of April, which is what Treasury said, but it looks like majority are still waiting.

I’m going to do another general poll on Monday for everybody, but here over the weekend I just want to know about those of you with dependent children, because one of the top five questions I’m seeing on the channel is, “Hey, I got the $1,200 for me but not the $500 for my kid,” so it seems that the IRS really screwed this up, so I just want to get a pulse here, so new poll in the channel, only for those with dependent children under the age of 17, I want to know if you’ve received your stimulus in the correct amount, in an incorrect amount, or if you’re still waiting or not eligible.

By the way, at the moment, the only way to fix the issue with not receiving the stimulus for dependent children is to file a 2020 tax return and get the benefit there, but what if you’re a non-filer? Well, I covered that in the Q&A I published yesterday, which I think I will work on adding a table of contents to by the way.

Now, let’s move on to Schumer and Romney.

Why?

Because these are two of the most prominent men in the Senate, one is a Democrat and one is a Republican, and as of this week they have both proposed something very similar in terms of another relief bill, and this is key, because this is an indication to me that the GOP and the Democrats in the Senate will be able to find some common ground here, all it takes is a little bit of common ground between the parties to get a conversation going, start here, then we’re going to talk about this, and that, this common thinking here between these two senators could really lead to some bipartisan legislation.

And remember that Romney — whom Trump has called a RINO, Republican in Name Only — remember that you can thank Mitt to some degree for your stimulus checks, because he, along with Tom Cotton, was really the first Republican to say in the Republican-controlled Senate, let’s send out checks, this was in March.

Remember, who was talking about stimulus checks first in response to COVID-19, first it was Andrew Yang, and AOC, and Tulsi Gabbard, right, and then more House Democrats, Tim Ryan and Ro Khanna, right.

And then on March 16 Mitt and Tom Cotton said, hey, we’d support $1,000 checks.

The next day, March 17, Trump administration came out and said, hey, we’d support checks too.

Now, what did Romney do this week.

He has proposed extra “Patriot Pay” for essential workers.

Does this sound familiar to you? It should. Because in my April 8 update I told you about Chuck Schumer, Senate Minority Leader, Democrat, and his proposed “Hereos Fund” to provide extra compensation to front-line workers.

And I think this is very necessary, right now, working right now as you’re watching this there are essential workers, people putting themselves on the line right now, risking exposure to COVID-19, who are working as you’re watching this, who are making less money working than some individuals on unemployment who are not working.

I made a video on April 3, almost a month ago, showing you some numbers how some people could be making a lot more on unemployment than they would by working, I’ve seen some people comment about that if I knew anything about that, and yes, it’s true, and I covered this on April 3 with a separate video called: “Is the Stimulus Too Generous to the Unemployed?” so you can go check that out.

Now, make to right now, early May, here are two prominent men in the Senate, one a Republican and one a Democrat, yes, Mitt has only been a senator for only a year, but he is still a very prominent political figure, right, and Chuck of course, Senate Minority Leader, these two proposing ideas that are quite similar at least in terms of the fundamental goal.

Now, it’s fun to talk about the junior Democrats in the House and all their fun proposals for no more rent payments, no more mortgage payments, two thousand a month, three thousand a month, fifty-five hundred dollars a month, right, those are fun and all, but what Romney and Schumer say, I pay a lot more attention to them, than to junior members of the House.

So what I want to talk about today, on the eve of the eve of the Senate being back in session, because remember, Senate is back on Monday, House is not, the Republican-led Senate, as I’ve told you before, in these circumstances, will dominate the conversation in the near future concerning the next relief bill, the next stimulus package.

So what I want to talk about is these two so similar but so different proposals, Schumer’s Heroes Fund and Romney’s Patriot Pay.

So first of all, Schumer is calling his plan a Heroes Fund, Romney is calling his Patriot Pay.

Now, at a basic level, both of these proposals want to give additional pay to “essential workers.”

However, neither proposal has really nailed down, specifically, what an “essential worker” is, in fact in Schumer’s proposal, it says, “The definition of essential workers will be the subject of debate. This proposal is not meant to exclude any worker from this conversation. Rather, we hope this proposal will encourage a discussion about how large and diverse this universe of workers truly is.”

That said, Schumer mentioned by name “the doctors and nurses, grocery store workers, transit workers, and more who are central to fighting this crisis.”

Notice that “and more” at the end which leaves it open, and obviously they want to leave this up to Congressional debate.

And Romney’s is similar, his proposal talks about, right off the bat, “America’s frontline workers providing health care, transportation, food, and more essential services.”

There it is again, “and more,” leaving it open to other personnel, right, so I’m pretty confident, that additional pay for these individuals, healthcare workers, food industry workers, transportation industry workers, will be included in the next stimulus package, we have a prominent Democrat and a prominent Republican talking about fundamentally the same thing.

But the devil is in the details, and let’s talk about those details.

So how much is this additional pay under these two bills?

So, in Schumer’s proposal, it’s an additional $13 an hour in pay, capped at $25,000 for workers making less than $200,000 a year, and capped at $5,000 for workers making $200,000 or more a year.

And this would be directly funded by the government, employer applies for the funds, government gives the funds to the employer, and any unused funds are returned to the government.

Romney’s proposal is that the government would subsidize 75% of a premium pay increase up to $12 an hour.

And this subsidy would be reduced by $24 for every $500 the employee’s annualized income exceeds $50,000.

So by the time an employee’s annualized income, including the additional pay for the Patriot Pay, once their annualized income hits $90,000, there’s no more credit at all.

Romney’s maximum subsidy per employee per month is $1,440. So what’s $1,440 divided by 75%, that’s $1,920.

So an employer could give an employee making less than $50,000 a year, even after the pay increase, could give an employee like that a $1,920 raise in a month, and the government would pay for $1,440 of that, with the employer kicking in the $480 difference.

And Romney’s proposal is a payroll tax credit.

Maybe it’s because I’m a CPA, but I actually like this payroll tax credit idea better, the business will have to float the money in the employee’s paycheck, but I think accomplishing this through a payroll tax credit is much more efficient than Schumer’s idea, which will require oversight and funds transfer and all these completely new processes in place that could become a logistical nightmare, just as we’ve seen with the stimulus checks.

But one downside of utilizing a payroll tax credit is that it leaves independent contractors out of the loop, right, and there are plenty of healthcare professionals and other workers who are contractors, not employees.

Schumer’s Heroes Fund, the proposal mentions both employees and independent contractors, while Romney’s only mentions employees, understandably, because he wants to accomplish this via a payroll tax credit, and businesses only pay payroll taxes for their employees.

So it appears that the way Romney has presented this, independent contractors who are essential workers would not qualify, at least based on what I’m seeing, while for Schumer’s they would, because it’s direct funding from the government to the business for them to distribute as they please.

Other differences, Schumer’s Heroes Fund didn’t say anything about a minimum number of hours a month, while Romney’s Patriot Pay requires the worker to work at least 100 hours per month.

In terms of working conditions, the language is similar, Schumer’s says, “frontline and public-facing positions,” Romney’s says, and this is a bit more blunt, but his says the employee must be working in “conditions that increase potential COVID-19 exposure.”

Schumer’s plan also includes an up to $15,000 recruitment bonus to fill a need where where there is “severe staffing shortages impeding the ability to provide care during the COVID-19 pandemic.”

Now, I have a feeling that if Schumer’s idea is included in the next relief package that the number of people eligible for the $15,000 will be a very small subset of the individuals eligible for the premium pay.

Romney’s plan does not mention a recruitment bonus.

Schumer’s would be retroactive back to January 27, apparently, and would go until the end of the year.

It looks like Romney’s would just go back to May 1 and go until July 31, but of course I’m sure this would be possibly extended as well, if they think it’s necessary, but you can kind of see by these dates where they’re coming form. I think a lot of Republicans feel that, hey, by the end of July, early August, hey, America should be re-opened, we should be good, while Schumer is like, well let’s push it to December 31.