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Inflation and end of stimuli pushes the US to a fiscal cliff

By hollisterclothingoutlet 11/06/2022 811 Views
  1. Jose Luis de Haro
Nueva York

The start of the new year is promised to be scrambled for the administration of the president of the United States, Joe Biden.With inflationary pressures raising the temperature of prices at levels not seen in almost four decades and the Federal Reserve list this week to accelerate the withdrawal of monetary stimuli, fiscal resources are promised as the last resort to continue endorsing consumption.

However, after having padded the economy with more than 6.9 billion dollars in stimuli to face pandemia, there is reluctance, even among the Democrats themselves, to implement the ambitious Biden agenda.His known as Build Back Better (rebuild better) is currently in the hands of the Upper House, where Democratic senators such as Joe Manchin (Western Virginia) and Kyrsten Sinema (Arizona) continue to reserve their right not to support a bill of law ofanother 1.85 billion dollars.At the moment, from CITI, they recognize that there are about 40% probability that the plan ends up biting the dust.

Toughest conditions

However, in a year with legislative elections on the horizon, a hardening of financial conditions (the market discounts up to three rates of rates this year) in loans and inflationary embers far from going out, many Americans will suffer next January a hardblow.By then, around 35 million American families could stop receiving the monthly payments of fiscal deduction per child.

La inflación y el fin de estímulos empuja a EEUU a un precipicio fiscal

The extended fiscal credit, as part of the stimuli activated in the thread upside down by the COVID-19, gave the parents the option to receive it in monthly payments instead of waiting to make their declaration taxes to claim these funds.The maximum fiscal credit per son of 2,000 to 3,600 also increased for fiscal year 2021. These changes have made a big difference for American families during pandemic.

Fundamentally they have allowed a predictability and crucial stability, since families have received up to $ 300 per month for each child under six years of age or $ 250 per month for each child between 6 to 17 years.Payments began in July, which means that some families will have pocketed this year $ 1,800 more for each child that meets the requirements.The Treasury Secretary herself, Janet Yellen, said during a recent hearing held last week that the expansion of fiscal relief for children has contributed about 77,000 million dollars to families' pockets, so far helping 61 million American children.

The vast majority of families with income less than $ 35,000 spend a part or all of the monthly payments related to this fiscal credit expanded in basic needs - livestock, food, clothing and public services - and in education, according to the center for prioritiesPolicy and Budget (CBPP), for its acronym in English).A considerable part of US households with income greater than $ 35,000 also uses this monthly pay in needs.

Without an extension, the tax credit would be 2,000 dollars per child, and the Americans would have to wait until the season of submitting their tax declaration in mid -April to claim it.To avoid this situation, Democratic legislators have until January 15 to act.

The Build Back Better bill, which the Democrats seekMost families for another year, ensuring these payments until the legislative next November.In addition, the extended credit would become permanent for families with few or no income.

But beyond this fiscal credit, at the end of December, the Government's temporary moratorium on the payments of federal student loans expires, which means that they will accumulate interest again and the borrowers must resume monthly payments.An analysis of the Roosevelt Institute, a non -profit Think Tank, estimates that the resumption of payments of student loans would reduce 85,000 million dollars a year from the family budgets of about 18 million Americans.

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