Personal income is up in Michigan and all 50 states, but activists call for more help
Maureen Taylor says that there has been “phenomenal temporary” state and federal government COVID-19-related relief, but more systemic action is needed to help Michiganders through tough economic challenges.
“It’s the difference between one box of cereal and two boxes of cereal, you know what I mean?” said Taylor, chair of Michigan Welfare Rights Organization. “But poor people weren’t able to keep up before the pandemic.”
Her comment comes as new data from the Bureau of Economic Analysis show that personal income rose in all 50 states and Washington, D.C., during the first quarter of 2021. Biden administration officials said this is largely to relief provided in the American Rescue Plan, the $1.9 trillion economic stimulus signed by Democratic U.S. president in March.
The plan provided $1,400 checks to millions of low-and middle-income Americans, new child tax benefits, and extended unemployment payments. Michigan received more than $10 billion in aid to state and local governments.
The development is in sharp contrast to the fourth quarter of 2020, when personal income fell in 27 states and D.C. At an annual rate, state personal income increased 59.7% in the first quarter of 2021, after decreasing 3.9% in the fourth quarter of 2020. The percent change in personal income ranged from 89.3% in Mississippi to 31.1% in the District of Columbia.
The White House said that more Americans are “getting back to work, the coronavirus is getting under control, and the economy is booming.”
Earnings in Michigan and eight other states including Illinois, Indiana, Kansas, Kentucky, Missouri, Ohio, Tennessee, and Texas increased, in part, due to profit sharing payments by auto manufacturers to workers represented by the United Auto Workers (UAW) union.
Ford Motor Co. announced in February that profit-sharing payouts of up to $3,625 for eligible hourly UAW members were to be paid out.
General Motors Co. also in February announced that hourly 44,000 UAW-represented employees would receive up to $9,000 in profit-sharing checks this year.
Fiat-Chrysler’s parent company Stellantis announced in March that thousands of dollars in profit sharing would be given to union auto workers after the company’s performance in 2020. UAW-represented employees were paid a bonus of $8,010 after FCA posted $29 million in net profit last year.
Decreases in earnings in South Dakota and five other states including Iowa, Montana, Nebraska, North Dakota and Wyoming were primarily the result of decreases in farm earnings due to lower payments to farmers from the Coronavirus Food Assistance Program.
However, property income such as dividends, interest, and rent decreased .1% for the nation in the first quarter of 2021 after increasing 5.8% in the fourth quarter. The percentage change in property income across all states ranged from 1.4% in South Dakota to -1.7% in Georgia.
Last week, the Biden administration extended a national moratorium on evictions for another month. The additional month of eviction relief comes after housing advocates have expressed concerns about the ramifications for renters if that moratorium by the Centers for Disease Control and Prevention expired on June 30.
More than 10 million adult renters were behind on rent payments as of early June, according to the Center on Budget and Policy Priorities, a progressive think tank.
U.S. Rep. Rashida Tlaib (D-Detroit) agrees with Taylor that many Americans were “already in survivor mode prior to the pandemic.”
Tlaib stated that Congress and the Biden administration must work together to make the Child Tax Credit permanent and more accessible, and also pass her legislation called the BOOST Act, which would provide a new tax credit of up to $3,000 for single people and up to $6,000 for married couples. It would supplement existing tax credits and direct the Internal Revenue Service to establish a Community Volunteer Income Tax Assistance Matching Grant Program to provide tax return preparation assistance to low-income taxpayers.
“For many of our residents, they don’t see a change in their quality of life,” Tlaib said.
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