In April 2008, 130 million eligible American households got checks from the federal government. Each person who made less than $75,000 a year got a $600 check. And each family with a child got $300 per child.
I remember this Economic Stimulus Act. It was a change of pace, checking the mail for a payment rather than for bills I couldn’t pay.
The checks were meant to stave off a recession, as economists and policymakers were starting to feel something was very wrong in early 2008.
In October of that year, it became clear that those checks didn’t do anything to stave off a recession. Mostly because they were aimed at the wrong sector of the economy.
It was rampant, unchecked fraud in the investment banking sector that almost crashed the credit market - the “business to bank to business” chain that was broken by Lehman Brothers. It also burst the bubble that sector had created on the value of our homes. And caused the Great Recession.
Less than a year later, Barak Obama did another round of stimulus checks. Given the devastation in the economy, this one should have been larger. The chair of his Council of Economic Advisors, Christina Romer, argued for a $1.25 billion stimulus. At least. But Obama had hired Timothy Geithner as his Treasury Secretary, and Larry Summers as his Economic Council director. They wouldn’t hear of such a large stimulus. It would upset the balance of the trickle down economy they had been instrumental in putting into place.
Remember, Summers is the economist who, this summer, argued that higher prices - which were caused by the pandemic - would only be tamed if people lost their jobs.
And so, in 2009, an $800 million stimulus went to infrastructure, small businesses, and people.
It wasn’t enough. More than 1.8 million small businesses had to shut their doors in the first two years of the recession.
With this stimulus, individuals got $400. And the child tax credit was expanded to $2,500.
But, unlike George W. Bush, Obama didn’t send out checks. He’s a reasonable guy. Reason, and the advice he was getting from his practical advisors, told him that people will spend a rebate on day-to-day living if it comes in their paychecks over a year, rather than one lump sum.
So, we all got $15.38 more in our paychecks.
It seemed like a joke. People were losing their houses. Hundreds of thousands of jobs were shed in January of 2009 alone. People were scared.
And those of us lucky to be employed got a whole 15 bucks more in each paycheck for 12 months.
It made us feel that our leaders didn’t really care about the people who lived outside of D.C. or New York.
The Big Gesture
But $400 per person is still $400 per person, whether it’s given to you as a lump-sum check or divvied out in a series of additions to your paychecks.
Let’s ignore for a moment that it wasn’t enough.
We live in a society in which the big gesture is hailed as heroic. We all cheer when we see “Marry Me!” on the jumbotron. We prefer lavish parties with all of our acquaintances to celebrate milestones, rather that quiet get-togethers with people who mean something to us. There is a thrill that goes through us when we file our tax returns and anticipate the big refund check.
We could avoid a big refund check and simply declare more dependents on our W4s. Then we’d see our own money increase our paychecks, rather than being loaned to the government until they give it back to us in April.
The average tax refund in the last few years has been $3,100. That’s about $119 per paycheck, if people decided to do that.
But many of us don’t. Because $119 every two weeks, as part of a check we already get, is not as sexy as a separate $3,100 deposit to your bank account.
It’s not a grand enough gesture. And if you calculate wrong, you might have to pay. Even if you’re just paying 12 bucks, it still feels bad to have to pay.
And so, in March of 2020 - just as we were all absorbing the unprecedented shutdown of the world’s economy - Congress and Trump (who knows the value of a grand gesture) gave every adult in the country who was making less than $75,000 a $1,200 check. Every child got $500.
People making more than $75,000 got something less than $1,200.
These were big checks that added to our income, since most of us hadn’t been laid off yet.
And those checks were all signed by Trump. He wanted to make sure people knew it was HIS grand gesture. Even if it was driven by Congress.
Then in December of 2020 - at the same time as Trump was holding meetings in the White House to try to subvert the election - we got another series of COVID checks. This time, every adult making less than $75,000, and every child, got $600.
In March of 2021, Biden gave all of us a $1,400 payment, and not only raised the child tax credit to $3,600 for younger children and $3,000 for older kids, but paid that credit on a monthly basis.
Which means families with kids got an EXTRA check every month. From the government. Getting that extra $300 or $250 a month per child made people feel good. It made people feel seen and cared for by their government.
Everyday Civics
I spent most of last week zooming in to panels, speeches and discussions for National Civics Week. It was fascinating - both in how often leaders in the promotion of civics expressed profound worry, bordering on cynicism, about the future of democracy and civic participation; and for how much youth leaders expressed anger at what was happening to their world.
I’m gonna take that as hopeful.
For me, civics is all of us taking care of each other. We do so through our government processes.
Those processes may be corrupt. So it is up to us to fix them.
Those processes are definitely slow. Which is why we need to develop plans for our civic engagement and make sure our voices are continually heard.
And those processes aren’t always manifested in a grand gesture, like stimulus checks or stadium marriage proposals.
We have to pay attention to the details.
And Biden has given us a lot of details, which should make us all feel good.
The American Rescue Plan is but one of the civic achievements from the Biden Administration in 2021 and 2022.
There’s the Chips and Science Act, passed in August of 2022. According to the Semiconductor Industry Association, the act has leveraged hundreds of billions of private investment.
In laymen’s terms, one of the reason cars became more expensive during and after the pandemic is because our new cars are all electronic - even the ones with motors in them. And the chips to make them run came from overseas. Remember those pictures of cargo ships floating off the California coast? Many of those were carrying chips for our electronic needs.
So, the Biden Administration set the wheels in motion to move microchip production back to the U.S.
But, somehow, “We’re building microchips in the U.S. again!” doesn’t inspire roaring cheers. Most people didn’t know we weren’t building microchips in the U.S. And even if the press were to write about it every day, most people wouldn’t stop and go, “Oh, this is cool. I will read this story.”
And yet, it IS cool. And it’s important.
People HAVE heard of the Infrastructure Act. But that’s because their Congresspeople and Senators have been barnstorming their states taking credit for the tangible things that have been built with the money.
This includes Republicans, who voted against the bill. Who are taking credit without mentioning it’s Biden’s plan.
Biden chided them about that in his State of the Union.
And journalists like Miami’s Jim DeFede have been holding representative’s feet to the fire.
As of November of 2023, 5,532 infrastructure projects have been green-lighted in the U.S.
You can see infrastructure projects by state here.
SCOTUS Kills the Sexy Vibe
Biden did put forward one sexy proposal that people did take notice of - the student loan forgiveness program.
Under pressure from the progressive wing of his party, Biden proposed up to $20,000 in debt cancelation if you got a PELL grant, and up to $10,000 if you didn’t. That would have “erased about $430 billion in student debt,” according to the National Conference of State Legislators.
But the Supreme Court scuttled the initiative, accepting the argument from red states that the Higher Education Relief Opportunities for Students Act, or HEROES Act, did not allow the Secretary of Education to forgive student loans.
This was a big gesture by Biden which got a lot of attention. And the Supreme Court rebuke was a big gesture that also got a lot of attention.
So, the Administration decided to forgive loans in a more piecemeal fashion, without relying on the HEROES Act.
With this week’s announcement that another $6 billion in student loans would be canceled, Biden’s incremental student loan forgiveness has added up to $150 million. It has helped mostly public sector employees, who should have had their loans forgiven anyway. But previous administrations didn’t uphold the law.
Journalists are reporting each time Biden does another round of student debt cancelations. The numbers are out there. But it’s not a jumbotron moment. And most people in the U.S. aren’t interested unless it affects them.
A few days ago, the news broke that the Justice Department was going after Apple for uncompetitive practices in it’s app store. The opening paragraph of the complaint tells a story. And that story made me realize that I am directly affected by Apple’s monopolistic practices every time I go to buy an electronic book, and have to use my computer or my kindle, because I can’t buy it via my phone.
I cannot help getting the feeling that my government is starting to care about me. That someone is out their fighting the small, seemingly insignificant injustices that we deal with every day. High student debt. Bridges I feel unsafe crossing. Ticketmaster fees.
This is what civics is about. It’s not the big gesture. But, if we pay attention, it can make a big difference.
Also… those jumbotron marriage proposals. They seem a bit coercive to me. I mean, who’s gonna say no when 30,000 people are watching you in the room, and countless more will see it on video later?
Grand gestures are overrated. I would prefer if someone just got on one knee, and lowered my damn cell phone bill.
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“I cannot help getting the feeling that my government is starting to care about me.” 👏 Yes! Such a great summary of what the Biden admin has done for us (and why nobody seems to notice).