Personal Finance

$1,400 stimulus checks, $15 per hour federal minimum wage: How soon Americans could see more money

Key Points
  • President Joe Biden's $1.9 trillion relief plan includes proposals for additional direct checks and a higher federal minimum wage.
  • Those efforts to get more money directly to Americans could change amid negotiations on Capitol Hill.
  • Americans hoping for more take-home cash will have to wait to see how the negotiations play out.
President Biden delivers remarks before signing a "Made in America" Executive Order at the White House on Jan. 25, 2021.
Jim Watson | AFP | Getty Images

A new $1.9 trillion plan pushed by President Joe Biden includes a host of initiatives aimed at shoring up Americans' finances as the Covid-19 pandemic rages on.

That includes $1,400 stimulus checks to bring the $600 payments Congress authorized in December to $2,000 in total.

The package also calls for raising the federal minimum wage to $15 an hour.

Now, Biden faces the task of trying to get the package through Congress. Despite a Democratic majority in both the House and Senate, analysts expect this will be no easy task. At a news conference on Monday, Biden also acknowledged the terms could change.

President Joe Biden discusses his $1.9 trillion Covid relief deal
President Joe Biden discusses his $1.9 trillion Covid relief deal

"I don't expect we'll know whether we have an agreement or to what extent the entire package will be able to pass or not pass until we get right down to the very end of this process, which will be probably in a couple of weeks," Biden said. "The point is this is just the process beginning."

For Americans, that could mean a longer wait before they see any more money.

How the $1,400 payments could change

The idea of new direct payments is popular with Americans. A recent Morning Consult poll found 79% of adults surveyed back the idea, which came in second after providing more small business aid, with 82%.

But the $1,400 sums could be up for negotiation, Biden admitted Monday, namely because of arguments that the aid would not necessarily be directed at those who need it most.

"There's a legitimate reason for people to say, 'Do you have the lines drawn the exact right way? Should it go to anybody making over X number of dollars?'" Biden said. "I'm open to negotiate those things."

The $1,400 amount was selected based on the $2,000 number the House of Representatives tried to move through in December. In the end, Congress agreed on payments of $600 per person.

More from Personal Finance:
How Biden's $1.9 trillion relief plan would avert a looming benefits cliff
One year after Covid in America: A financial snapshot
What to know if you still haven't received your $600 stimulus check

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"I picked it because I thought it was rational, reasonable, and it had overwhelming bipartisan support in the House when it passed," Biden said.

Experts expect passage of the package could be delayed and ultimately scaled down.

"One of the big debates right now is a balance between act fast and act big," said Ed Mills, Washington policy analyst at Raymond James.

If lawmakers move fast, the $1,400 checks and money for vaccines would be most likely to make the cut. "Those are the two most bipartisan portions of this bill," Mills said.

A bigger package would probably require a process known as budget reconciliation, he said.

The most likely change around stimulus payments would be better efforts to get money to those who are suffering most in a K-shaped recovery, Mills said, where some parts of the economy are slower than others.

Such a change could mean fewer people may qualify for the full $1,400 payments.

"I think Congress wants to find a way to get assistance to those who are in the bottom leg of the K," Mills said.

How soon those payments reach people will depend on how quickly lawmakers agree.

Democrats have said they want to get something done in the coming weeks. However, the next most likely pressure point for Congress to reach a compromise will be in mid-March, when some support for the unemployed runs out, Mills said.

$15 minimum wage faces hurdles

Protestors call for McDonald’s Corporation to raise wages to a $15 minimum and allow unionization in Fort Lauderdale, Florida.
Joe Raedle / Getty Images

The national minimum wage has not been raised from its current $7.25 per hour since 2009.

However, lawmakers may not be ready to push through a mandated higher hourly rate with the new stimulus deal.

Mills said it's "highly unlikely" such a change would go through.

"Voters support increases in the minimum wage probably more than some members of Congress," Mills said.

However, when asked on NBC's "Meet the Press" on Sunday whether the administration would be willing to table raising the minimum wage, White House chief of staff Ron Klain reaffirmed the administration's commitment to getting it passed now.

"We certainly think the minimum wage should be part of this urgent relief package," Klain said.

On Tuesday, Democrats in both the House and Senate reintroduced a bill to raise the federal minimum wage to $15 per hour. The proposal calls for gradually raising the pay rate by 2025.

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