CARES Act Gimmicks: How Not To Give People Money During a Pandemic And What To Do Instead

2020 U. Ill. L. Rev. Online 81

15 Pages Posted: 24 Apr 2020

See all articles by Pamela Foohey

Pamela Foohey

Indiana University Maurer School of Law

Dalié Jiménez

University of California, Irvine School of Law; Harvard Law School - Center on the Legal Profession

Christopher K. Odinet

University of Iowa - College of Law

Date Written: April 2020

Abstract

The coronavirus pandemic upturned Americans’ lives. The profound financial effects caused by even a few weeks of the coronavirus’ upheaval spurred Congress to pass the CARES Act, which purported to provide economic relief to individuals and businesses. For individuals, the CARES Act includes five provisions that were effectively designed to provide people money. Chief among those provisions are a direct payment in the form of a tax rebate and enhanced employment benefits.

Ultimately, this financial support will prove to be shockingly minimal. The direct payments represent a fraction of the average American households’ monthly budget. The unemployment benefits, while providing people with more money over several months, require that people be laid off and similarly are unlikely to reach people quickly enough to be effective. These corner pieces of the CARES Act are best understood as gimmicks. Through them, the federal government told people that it would take care of them in ways that were immediately salient to them as the coronavirus crisis began.

It also became quickly apparent to at least some lawmakers that Congress would need to pass at least one additional stimulus package. Indeed, Congress may have several more opportunities to craft legislation that actually will help American families survive the pandemic. This legislation must provide people with true funding to stay current with their minimum necessary expenses as these expenses are incurred. In this Essay, we discuss the gimmicks of the CARES Act’s individual provisions and what Congress should do for people in future bills to address this pandemic.

Keywords: CARES Act, coronavirus, covid-19, relief rebate, direct payments, unemployment benefits, consumer debt, consumer credit, foreclosure moratorium, eviction moratorium

JEL Classification: D10, K36

Suggested Citation

Foohey, Pamela and Jiménez, Dalié and Odinet, Christopher K., CARES Act Gimmicks: How Not To Give People Money During a Pandemic And What To Do Instead (April 2020). 2020 U. Ill. L. Rev. Online 81, Available at SSRN: https://ssrn.com/abstract=3583464

Pamela Foohey (Contact Author)

Indiana University Maurer School of Law ( email )

211 S. Indiana Avenue
Bloomington, IN 47405
United States
812-855-1257 (Phone)

Dalié Jiménez

University of California, Irvine School of Law ( email )

401 E. Peltason Dr.
Ste. 1000
Irvine, CA 92697-1000
United States

HOME PAGE: http://www.law.uci.edu/faculty/full-time/jimenez/

Harvard Law School - Center on the Legal Profession ( email )

1585 Massachusetts Avenue
Wasserstein Hall, Suite 5018
Cambridge, MA 02138
United States

Christopher K. Odinet

University of Iowa - College of Law ( email )

130 Byington Road
Iowa City, IA 52242
United States

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