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“Economic Uncertainty and Stimulus Checks: Why Stimulus Checks Don’t Fix the Rising Rate of Poverty and Mental Health Concerns in the Midst of a Pandemic”
The purpose of this blog is to allow the audience to think critically and seek a deeper understanding on complex societal issues that impact the diverse communities in which we live, are employed, socialize, and engage in social justice and lasting change. It will be a platform where data-driven information, opinion, and current events intersect and create space for conversations wherever you may find yourself as the reader. As the inaugural post, and with so much going on in just the first month of a new year, it is both valuable and recommended to make room for the conversations included in this post as well as the ones that will follow.
“Every human society must justify its inequalities: unless reasons for them are found, the whole political and social edifice stands in danger of collapse. Every epoch therefore develops a range of contradictory discourses and ideologies for the purpose of legitimizing the inequality that already exists or that people believe should exist. From these discourses emerge certain economic, social, and political rules, which people then use to make sense of the ambient social structure. Out of the clash of contradictory discourses—a clash that is at once economic, social, and political—comes a dominant narrative or narratives, which bolster the existing inequality regime” (Capital and Ideology, Piketty, 2020).
Inequality, dominant narratives, racial tension, capital takeovers, presidential changes, police brutality, mental health crises, poverty and economic disparities, stimulus checks, and more mark prominent headlines and realities for millions of Americans during this pandemic. Most of these topics have historically been unfortunate realities for the American people, however this past 10 months has elevated mental health concerns, rates of poverty, and forced many to take a step back and look at the bigger picture: What do we do about it all?
As we approach nearly a year of living in the midst of global pandemic, it is important to take note and prepare for the impending consequences and impact of such a detrimental time in history. We can look at the pandemic through many lens’, however this publication will review the economic impact and mental health concerns related to the rise of unemployment due to COVID-19, social isolation, stay at home orders, and unemployment rates rising. It will also discuss the stimulus checks, data-driven reporting on the benefits of the stimulus through the CARES Act, and social service perspective as helplines across the nation have received record-breaking call volumes since last March.
Let’s talk first about poverty and cost of living in the United States. We can first take a look at the current federal poverty guidelines classified by the Census Bureau. According to the U.S. Department of Health and Human Services, ASPE Office defines two different versions of poverty measurement: poverty threshold and poverty guidelines. Poverty threshold can be clearly defined on the Census Bureau’s website. Poverty guidelines include household income on an annual basis. As of last year, the poverty guidelines on a state-basis (excludes Alaska and Hawaii) are as follows: 1 Person = $12,760, 2 Persons = $17,240, 3 Persons = $21, 720, 4 Persons = $26,200, 5 Persons = $30,680, 6 Persons = $35,160, 7 Persons = $39,640, 8 Persons = $44, 120, 9+ Persons = Add an additional $4,480 for each person. It is important to note that the creation of the 2020 poverty guidelines are measured by the 2019 calendar year which was due for submission in September of 2020.
Now that we have established the current poverty guidelines, it is important to look also at household incomes and cost of living. The median household income in 2019 was $68,703 in 2019 according to the U.S. Census Bureau. Average cost of living in the United States varies greatly on a state-by-state basis, for instance Arkansas’ living wage is $44, 571 (second –lowest on index in the country) and The District of Columbia’ living wage is $67,867 (second-highest on the index in the country). That is a difference of over $20,000, a significant amount for the average American. Additionally, this can vary greatly in impact based on the number of individuals in each household. This data also does not navigate or discuss the unpredictable costs accrued for individuals and families over the course of a year that can include, but are not limited to medical expenses, illness, unemployment, mental health treatment, and any other cost that reaches beyond “basic needs.”
In order to link the above facts with current research findings on relief funding, we will need to look at reports that have been completed in recent months to determine if they have been positive or negative in alleviating risks of increased poverty. Research done on the impact of the stimulus through the CARES Act shows a variety of positive factors that the CARES Act, stimulus and unemployment insurances have provided to individuals, families and businesses during this time. “To ensure that the government can track the income changes of the American population overall and by demographic group to target and calibrate its fiscal response most effectively requires timely information on income and poverty. Unfortunately, official estimates of income and poverty for 2020 will not be available until September of 2021. These official statistics will be of little use to federal, state, and local policymakers who need to decide quickly how to allocate scarce resources to minimize COVID-19’s impact on vulnerable populations” (Han, 2020, pg. 1) Further, “In the poverty rate, calculated each month by comparing family incomes for the past twelve months to the official poverty thresholds, fell by 1.5 percentage points from 10.9 percent in the months leading up to the pandemic (January and February) to 9.4 percent in the three most recent months (April, May, and June). This decline in poverty occurred despite that fact that employment rates fell by 14 percent in April—the largest one month decline on record” (p. 2).
To conclude this conversation, it is important to look at this issue of economic decline and overall social decline as it relates to mental health and well-being. As a social worker and mental health practitioner, it is both alarming and cause for concern, hearing about the rise of national helpline calls during the pandemic. From suicide prevention to domestic violence and sexual assault, to child abuse tips, it has become clear to professionals in the social service field, that we are going to see an increase in mental health concerns and needs until we find a balance in economic decline and are able to stabilize the negative impacts of social isolation.
The unfortunate reality we see as social workers is this: The stimulus check has not made a dent in meeting the needs of individuals and families experiencing poverty, domestic violence, human trafficking, sexual exploitation, and homelessness. $1200 (a person) and $600 (a person) if one qualified and received the funds, does not cover the cost of living listed above or any emergency needs that may have been present in the last 10 months. And more than just financially, no amount of money can relieve the risks that men, women, and children have experienced being forced into social isolation, some of whom live with an abuser(s).
We have seen through news and other media outlets that self-care and other methods for relieving mental stressors have also not been fully effective in combating the stressors that this pandemic has exacerbated on individuals, families, communities, and the nation. So how do we plan? How do we fix these issues that have the potential to cause years of challenges? How do we support one another in an effort to seek social justice and change, while also caring for our own needs? The answers to these questions are anything but simple. However, with new funding periods coming and an increase in grant funding all over the country, programs that meet diverse needs are able to finance case management and therapy, housing relief, homelessness prevention, court and legal advocacy, utility assistance, domestic violence and abuse intervention, and more.
It will take time, continued effort and initiative, and collaboration. In many ways, the impact of the pandemic is still extremely unpredictable, however as reports are published, it is the hope of professionals in all fields, that solutions can be created that minimize the impact of this last year and course-correct the ways in which this year has challenged everyone.
References and Resources
Han, J., Meyer, B., & Sullivan, J. X. (2020). Income and Poverty in the COVID-19 Pandemic. NBER working paper, (w27729)
Parolin, Z., Curran, M., Matsudaira, J., Waldfogel, J., & Wimer, C. (2020). Monthly Poverty Rates in the United States during the COVID-19 Pandemic. Center on Poverty and Social Policy at Columbia University.
Cost of Living Index: https://worldpopulationreview.com/state-rankings/cost-of-living-index-by-state
Economic Impact Resource: https://www.epi.org/blog/over-13-million-more-people-would-be-in-poverty-without-unemployment-insurance-and-stimulus-payments-senate-republicans-are-blocking-legislation-proven-to-reduce-poverty/
Mental Health Journals: Alonzi, S., La Torre, A., & Silverstein, M. W. (2020). The psychological impact of preexisting mental and physical health conditions during the COVID-19 pandemic. Psychological trauma: theory, research, practice, and policy.
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