As whispers of a potential new stimulus check circulate on social media platforms like TikTok and X, many Americans are wondering if former President Donald Trump, should he return to office in 2025, might issue another round of financial relief. While the idea of another stimulus payment may sound appealing to inflation-weary consumers, the reality is that the likelihood of such an occurrence is extremely slim. Here’s why.
Credits: The Economic Times
What Led to Stimulus Checks in 2020?
The world economy was rocked by the COVID-19 pandemic in 2020. Due to company closures, millions of Americans lost their jobs, causing the unemployment rate to rise to about 15%—the highest level since the Great Depression. Two stimulus checks were sent under Trump’s administration to lessen the impact, while a third was issued under President Biden.
These payments were intended to boost consumer spending, which is a key factor in economic recovery, and give struggling households instant financial assistance. However, the current state of the economy no longer supports the conditions that called for such actions.
The Economy in 2024: A Different Story
Although many Americans continue to feel economic strain, economists agree that the U.S. economy is in a much healthier position today than it was in 2020. Key indicators paint a relatively stable picture:
Low Unemployment: At 4.1%, the jobless rate is near a 50-year low, reflecting a strong labor market.
Controlled Inflation: Inflation has eased to 2.6%, inching closer to the Federal Reserve’s annual target of 2%.
GDP Growth: The economy has shown consistent growth, driven by resilient consumer spending and strong business investment.
“Despite some pain points and general ‘bad vibes’ expressed by the public, the economy is currently in remarkably good shape,” said Jacob Channel, senior economist at LendingTree.
The Role of Congress: Why a Stimulus Check Isn’t on the Horizon
A prevalent misperception is that stimulus checks can only be issued by the president. Actually, in order to make such payments, Congress must approve legislation and the president must sign it into law. Bipartisan cooperation in the face of an extraordinary crisis resulted in the stimulus checks during Trump’s presidency.
Legislation authorizing more stimulus payments is not yet in the works, and Congress is not particularly interested in funding such expenditures. Any such legislation would require Congressional support, which is extremely unlikely given the state of the economy, even if Trump were to win reelection.
Could a New Stimulus Check Hurt the Economy?
There are two sides to stimulus checks. They give consumers instant respite, but by increasing consumer demand, they can also make inflation worse. Massive public spending during the pandemic led to the biggest inflation in forty years, which the Fed has been working feverishly to curb.
The last thing authorities would want to do, Channel argued, is to excessively boost consumer demand while inflation is still a problem.
Another round of stimulus payments may reverse the gains made in reducing inflation and force the Fed to maintain higher interest rates for longer, which would be detrimental to long-term economic growth.
Credits: CBS News
Trump’s Probable 2025 Economic Agenda
Experts predict that Trump’s government will prioritize tax reforms above direct stimulus payments if he wins reelection. Along with resolving financial issues, extending the tax cuts from his 2017 Tax Cuts and Jobs Act is probably going to be a key priority.
Inflationary pressures may also be brought on by Trump’s economic initiatives, which include tougher immigration laws and import taxes. According to economists, these policies could increase inflation by as much as 1%, which would further reduce the likelihood of further stimulus checks.
The Bottom Line
For Americans hoping for another round of stimulus checks, the reality is clear: it’s not going to happen anytime soon. The economy is far from the crisis conditions that prompted the payments in 2020, and neither Congress nor economists see the need for such measures today.
While social media may fuel speculation, the facts suggest that a new stimulus check under Trump or any other administration is highly unlikely. Instead, future policy discussions are expected to focus on long-term tax and budget reforms rather than short-term financial relief.
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