Republicans are facing a major debate when it comes to stimulus package 4. Sending a second round of stimulus checks could help buy some votes come November, but it could also alienate some conservative voters who are concerned about the federal budget deficit.
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The need for stimulus package 4
Although there has been plenty of talk about stimulus package 4, it doesn't necessarily mean there will be one. The Senate has said it won't even take up the issue until after the two-week recess that starts on July 3.
As a result, there is a chance that the economy will recover enough that there won't be a need for a fourth stimulus package or a second round of checks. Some Senate Republicans are hoping that stimulus package 4 won't be needed. Sen. Richard Shelby of Alabama said they need to "make doubly sure that we need it," according to The Wall Street Journal.
Senate Republicans are facing a balancing act because some senators come from states that desperately need more stimulus, while other states are doing better and might be able to recover without a fourth package.
However, Federal Reserve Chairman Jerome Powell, several White House advisers and many economists have said that the need for a stimulus package 4 is great. Many officials are advising lawmakers not to stop stimulus efforts too early.
On the other hand, some lawmakers have noted that economic data points have suggested that the recovery is already underway. They believe there might not be a need for stimulus package 4.
Instead of more stimulus
Even if there isn't another stimulus package, per say, it doesn't mean lawmakers don't want to make some efforts to stimulate the economy. Many lawmakers who oppose additional spending are lobbying for tax cuts instead of a second round of stimulus checks or other spending.
Even if there isn't a second round of stimulus checks from the IRS, there could be significant savings for American taxpayers. For example, many Republicans want to pass a payroll tax cut, which would put more money in the pockets of taxpayers, who could then spend it and stimulate the economy. However, Democrats generally oppose a payroll tax cut, so it's hard to imagine the measure passing the Democrat-controlled House of Representatives.
Although President Donald Trump has repeatedly expressed support for a payroll tax cut, the White House has also signaled expectations of a stimulus package 4. Thus, Trump's influence could play a role in convincing hesitant Republicans to pass more stimulus. A payroll tax could be part of the package along with other provisions.
What could be in stimulus package 4?
Most Americans are hoping to see a second round of stimulus checks in the fourth package. Talk seems to be moving further and further away from that possibility, although Trump has previously expressed an openness to the idea.
Stimulus package 4 could include other ways to stimulate the economy that would benefit the average American. For example, an infrastructure spending bill would provide more jobs, potentially replacing some of the jobs that were lost due to the COVID-19 pandemic and permanent business closures that have been coming after.
There has also been talk about a bill focused on increasing manufacturing jobs in the U.S., which would also be beneficial as many businesses haven't been able to survive an extended closure. President Trump has also discussed a tax credit for Americans who want to travel domestically, which would stimulate the tourism and hospitality industry.
In the Senate, lawmakers on both sides of the aisle seem to agree that stimulus package 4 should be more targeted and less broad-based than the first three packages have been. Millions of Americans remain out of work, although the unemployment rate surprised economists by dropping in May.
Other potential provisions in stimulus package 4 include a back-to-work bonus to incentivize people to return to work, financial assistance for state and local governments, extra unemployment benefits, and business tax breaks.
