Here we go again. The new Biden administration isn't hesitating one bit to push through another round of stimulus. Don't get me wrong. Much is still needed to help people who have been impacted by this pandemic, but here in lies my issue with stimulus. It is too broad. Since the criteria is that it goes to anyone who makes less than $75K, it is giving money to people who still have jobs and who have not been impacted by the virus.
There is a better way to provide stimulus to those who really need it. What if we compared individual tax returns from 2019 to 2020? Anyone who showed a decline in income between the two years would be made whole up to say $10K so long as the income from 2020 was $75K or less.
$10K to an individual or family who actually had their income cut would be way more meaningful to them than $2K. Plus this encourages everyone who needs the money to file their taxes timely. And if a lucky day trader happened to turn their first round of stimulus into investment profits that offset their loss of income, this would take that into account since any short term or long term gains would be reported as income.
Whether this idea is the way to go or there is a better one, what I do know is we need to be more strategic about how to direct stimulus funds. Let's not just keep doing blanket stimulus checks to a wide swath of the population. That is having unintended consequences elsewhere with things like inflation, stock market extremes, and enriching corporations where that money gets spent. Instead, let's find a way to better identify those who really need help and get them a meaningful amount of money that will actually help them get through this difficult time.