Possible Fourth Stimulus Check May Do More Bad Than Good, Economist Says

KEY POINTS

Economist Martin Cantor: More payments would encourage Americans not to work
He says people have to go back to work in order for the economy to grow
The warning comes as more Democrats renew push for more checks

As more Democrats in Congress urge President Joe Biden to send out a fourth round of checks, an economist has warned that more payments to Americans may do more bad than good.

On May 17, a group of seven Democrats on the House Ways and Means Committee sent a letter to President Biden urging him to add monthly stimulus checks and enhanced unemployment benefits to his American Families Plan.

“Families and workers shouldn’t have to worry about whether they’ll have enough money to pay for essentials in the months ahead as the country continues to fight a global pandemic and recession,” the letter read.

“Tying recurring direct payments and automatic UI extensions to economic conditions would do just that. We urge you to include both in the American Families Plan and are ready to work to enact this critical relief into law,” it continued.

Amid the push by Democrats, Dr. Martin Cantor -- a consulting economist -- has said that sending out another round of stimulus checks could encourage people not to go back to work, which may hamper economic growth.

“Now the economy is starting to pick up and jobs are being created. The reality is people have to go back to work in order for the economy to grow,” Cantor said, according to My Twin Tiers. “Right now, all of the economic growth is because of government programs. We have to get back to economic growth through the old fashioned way. Jobs [being] created [through] people buying and selling [and] businesses producing.”

Cantor also suggested that the president’s $3 trillion Build Back Better plan should instead be used for infrastructure, roads, and bridges.

“It is basically borrow, spend, and worry about inflation later,” he said, adding: “The President’s $3 trillion infrastructure package that he is looking to spend would be inflationary. The Republicans have it right. $600 to $700 billion for pure infrastructure, roads, bridges, tunnels, that is where the money should go. That will create jobs.”

The U.S. has already distributed three rounds of relief checks since the beginning of the COVID-19 pandemic, starting with the $1,200 check sent out in March 2020. It was followed by $600 checks sent in December 2020 and January 2021, and the $1,400 payments sent in March and April of this year.