'Madness': In Cave to Right-Wing Dems, Biden Agrees to Further Limit Eligibility for Direct Payments

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In the face of pressure from a faction of conservative Senate Democrats, President Joe Biden reportedly agreed Wednesday to limit eligibility for direct relief payments by accelerating the phase-out of $1,400 checks proposed in the emerging $1.9 trillion coronavirus relief package.

Under the new eligibility structure, according to the Washington Post, individuals earning $75,000 or less annually and couples earning $150,000 or less will still receive full $1,400 payments, as proposed by the relief package passed by the House last week.

But under the latest framework pushed by conservative Democrats and accepted by Biden, the phase-out of the $1,400 checks will end at $80,000 for individuals and $160,000 for joint filers--meaning individuals and couples who earn more will receive nothing, not even partial payments. The House bill proposes (pdf) ending the phase-out at $100,000 in yearly income for individuals and $200,000 for couples.

Among the Senate Democrats who pushed for the quicker phase-out were Sens. Joe Manchin (D-W.Va.) and Jeanne Shaheen (D-N.H.).

Progressives have warned that because eligibility for the checks could, for some, be based on the income reported on their 2019 tax returns, people who were doing relatively well before getting hammered by the pandemic will be denied direct relief. Under the House relief bill, the IRS would be directed to base eligibility for the payments on 2020 income for those whose returns are on file.

"This is not targeting," Matt Bruenig, founder of the People's Policy Project, said last month of earlier efforts to restrict eligibility. "It is the illusion of targeting, an illusion that will end up hurting tens of millions of people who are currently in need but weren't in 2019."

An analysis by the Institute on Taxation and Economic Policy finds that the new eligibility framework adopted by Senate Democrats with Biden's support would result in around 12 million fewer adults and five million fewer children receiving direct relief payments than would have gotten them under the House plan. The Senate is expected to begin voting on its version of the $1.9 trillion coronavirus relief package as early as Wednesday afternoon.

Robert Cruickshank, campaign director at advocacy group Demand Progress, pointed out Wednesday that under the new eligibility structure, "some people who got checks when Trump was president won't get them now that Biden is president."

"There is no upside to this, only the massive downside of handing Congress to the Republicans next year," Cruickshank added. "Madness."