Stimulus Checks: 3 Facts That Could Push Congress to Take Action

Stephanie Downs

08/29/2020 02:43 pm EDT

Over the past month, Congress has been trying to come to an agreement on another stimulus package. But, given that they are currently on recess until after Labor Day, it doesn't appear as though they will enact another plan anytime soon. As a result, Americans have been growing increasingly frustrated at their elected officials for their lack of action. What could spur them to agree on another package? According to Forbes, three specific factors could prompt Congress to take action.

The White House and Congress initially agreed to their first stimulus package, the CARES Act, in March. Under that plan, eligible Americans received a one-time check of $1,200. Since it has been five months since they enacted a stimulus plan, and there is no clear end in sight to the coronavirus pandemic, Americans are wondering when more federal assistance could be on the way. But, Democrats and Republicans have not been able to agree on another package, with each side blaming the other for this impasse.

What could spark lawmakers to come together on another plan finally? As Forbes outlined, three facts could play into their decision to take action. According to the publication, airlines are threatening mass layoffs, consumers are growing increasingly concerned over the lack of federal aid, and there could be the threat of a double-dip recession.

Airlines Could Implement Mass Layoffs

(Photo: Robert Alexander/Getty Images)

Airlines initially saw their businesses crumble at the start of the pandemic due to various shelter in place orders around the country (and the world). The government did grant airline companies with $25 billion in aid to assure that they would stay afloat. However, the one caveat with that aid was that airlines could not implement major staffing changes through September. Since that deadline is fast approaching, airlines are warning that mass layoffs and furloughs are ahead.

American Airlines announced on Tuesday that they will have to lay off 19,000 workers including pilots, flight attendants, and technicians starting on Oct. 1. Other airlines have announced similar moves. United Airlines said that they would need to furlough nearly 36,000 employees this fall. Delta Airlines shared that they would need to furlough around 2,000 pilots come October. Forbes noted that these announcements were made partly to put pressure on the government to provide more aid amidst the ongoing health and economic crisis.

Threat Of A Double-Dip Recession

Congress could also be spurred to take action given that there is a chance the country is headed for a double-dip recession. Under a survey done by the National Association for Business Economics, two-thirds of the economists that they spoke to indicated that the United States has not escaped recession. Additionally, 80% of those economists said that there is a 25% chance that the country could see a double-dip towards another recession after the economy briefly recovers.

Dennis Lockhart, the Atlanta Fed president from 2007 to 2017, even touched upon this possibility in a recent interview with CNBC's Squawk Box Asia on Friday. He said that if the United States is not able to get the coronavirus outbreak under better control and if Congress does not come to an agreement on another package soon, the country could be in trouble. "I continue to believe that looking forward you have to consider a range of scenarios and among those scenarios would be, obviously, a pessimistic one and that could be a double-dip," Lockhart explained. "If things go badly with the management of the virus and there's more cascading — which (Thursday's) numbers of initial claims might suggest — then yes, it's possible we have a double-dip. I don't think that's probably the base case, but I think it's still possible."

Consumers Are Growing Concerned

(Photo: Roy Hsu / Getty Images)

Forbes reported that one of the biggest indications of how people feel about the economy ties back to their confidence in spending. Based on that figure, the economy may be headed for trouble. The consumer confidence index is currently at its lowest level in six years. In August, it marked its second straight month of decline.

On the flip side, consumer spending has been up in May and June. However, that uptick is likely due to the impact of stimulus checks and additional unemployment benefits. Since those unemployment benefits expired at the end of July and there doesn't seem to be any additional economic impact payments on the way anytime soon, consumer spending (and consequently, the economy) will likely be impacted. As a result, Congress could be moved to take action if the economy does take a turn for the worst.

Disclosure: PopCulture. is owned by Paramount. Sign up for Paramount+ by clicking here.