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Second stimulus check: 156 economists push for recurring direct payments

A group of economists argue that ongoing coronavirus stimulus payments will boost consumer spending and drive economic recovery.

An open letter from 156 economists from dozens of universities is calling on policymakers to make the next round of stimulus payments recurring until the economy recovers amid the coronavirus pandemic.

"The widespread uncertainty created by the COVID-19 pandemic and recession calls for a multifaceted response that includes automatic, ongoing programs and policies including more direct cash payments to families," the letter, published by the Economic Security Project and the Justice Collaborative advocacy groups, said.

In addition to ongoing stimulus checks, the group of economists are also calling for additional unemployment benefits, state and local government aid, enhanced SNAP benefits and more child care funding.

Some of the notable economists who signed onto the letter include Claudia Sahm, a former Federal Reserve economist, and Jason Furman, a former senior economic adviser to President Barack Obama.

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"Direct cash payments are an essential tool that will boost economic security, drive consumer spending, hasten the recovery, and promote certainty at all levels of government and the economy – for as long as necessary," the letter said.

The economists argue that lasting payments will boost consumer spending and drive economic recovery. They go on to say that the response to the Great Recession in the late 2000s was "too small and too brief."

RELATED: $600 extra unemployment benefit ends sooner than some might think

Credit: AP
In this April 23, 2020, photo, President Donald Trump's name is seen on a stimulus check issued by the IRS to help combat the adverse economic effects of the COVID-19 outbreak, in San Antonio.

"The first round of economic impact payments were a lifeline that helped some get by for a few weeks...but the worst is not over," the letter said. "Regular direct stimulus payments tied to economic indicators will help families stay afloat and drive economic activity."

The letter comes as the U.S. Senate returns from a recess Monday, where passing another economic stimulus package is a top priority.

Senate Majority Leader Mitch McConnell has floated the idea of providing a second stimulus check to those making $40,000 a year or less.

"I think the people who have been hit the hardest are people who make about $40,000 a year or less. Many of them work in the hospitality industry. So that could well be a part of it," McConnell said during a July 6 press conference.

RELATED: Next coronavirus stimulus may have $40,000 income cap

House Democrats passed the HEROES Act back in May, a $3 trillion bill which would have offered another $1,200 per person plus $1,200 per dependent, with a $6,000 cap per household. The Republican-held Senate deemed the bill dead on arrival.