The share of people living in poverty in the United States fell to a record low last year as an enormous government relief effort helped offset the worst economic contraction since the Great Depression.
In the latest and most conclusive evidence that poverty fell because of the aid, the Census Bureau reported on Tuesday that 9.1 percent of Americans were living below the poverty line last year, down from 11.8 percent in 2019. That figure — the lowest since records began in 1967, according to calculations from researchers at Columbia University — is based on a measure that accounts for the impact of government programs. The official measure of poverty, which leaves out some major aid programs, rose to 11.4 percent of the population.
The new data will almost surely feed into a debate in Washington about efforts by President Biden and congressional leaders to enact a more lasting expansion of the safety net that would extend well beyond the pandemic. Democrats’ $3.5 trillion plan, which is still taking shape, could include paid family and medical leave, government-supported child care and a permanent expansion of the Child Tax Credit.
Liberals cited the success of relief programs, which were also highlighted in an Agriculture Department report last week that showed that hunger did not rise in 2020, to argue that such policies ought to be expanded. But conservatives argue that higher federal spending is not needed and would increase the federal debt while discouraging people from working.
difficult to assess changes in health coverage last year. Census estimates conflicted with other government counts, and officials acknowledged problems with data collection during the pandemic.
federal supplement to state unemployment benefits lapsed. She fell behind on bills, setting in motion events that ultimately left her family homeless for two months this year.
New aid programs adopted this year, including the expanded Child Tax Credit, helped Ms. Long, who moved into a new home last month. She said she had noticed improvements in her children, particularly her 5-year-old son.
“It was bad, but it could have been so much worse, and we have come out the other side once again unbroken,” Ms. Long said.
By the government’s official definition, the number of people living in poverty jumped by 3.3 million in 2020, to 37.2 million, among the biggest annual increases on record. But economists have long criticized that definition, which dates to the 1960s, and said it did a particularly poor job of reflecting reality last year.
7.5 million people lost unemployment benefits this month after Congress allowed expansions of the program to lapse.
Jen Dessinger, a photographer who lives in New York City and Los Angeles, said work dried up abruptly at the start of the pandemic. A freelancer, she didn’t qualify for traditional unemployment benefits but eventually received help under a federal program created last year to help people who fell outside the regular system.
Now that program has ended in the middle of another surge in coronavirus cases. Ms. Dessinger said a single positive coronavirus case could shut down a photo shoot. “It’s made it a more desperate situation,” she said.
Democrats on Tuesday said experiences like Ms. Dessinger’s showed both the potential for government aid to protect people from financial ruin, and the need for a more expansive, permanent safety net that can support people in bad and good times.
A White House economist, Jared Bernstein, said on Tuesday that the new poverty data should encourage lawmakers to enact the $3.5 trillion Democratic measure that includes much of Mr. Biden’s economic agenda, which the administration argues will create more and better-paying jobs.
“It’s one thing to temporarily lift people out of poverty — hugely important — but you can’t stop there,” said Mr. Bernstein, a member of Mr. Biden’s Council of Economic Advisers. “We have to make sure that people don’t fall back into poverty after these temporary measures abate.”
“reckless taxing and spending spree.”
Conservative policy experts said that although some expansion of government aid was appropriate during the pandemic, those programs should be wound down, not expanded, as the economy healed.
“Policymakers did a remarkable job last March enacting CARES and other legislation, lending to businesses, providing loan forbearance, expanding the safety net,” Scott Winship, a senior fellow and the director of poverty studies at the American Enterprise Institute, a conservative group, wrote in reaction to the data, referring to an early pandemic aid bill, which included around $2 trillion in spending. “But we should have pivoted to other priorities thereafter.”
Jason DeParle and Margot Sanger-Katz contributed reporting.
Andrea Jones hadn’t yet settled on a date to retire from her customer service job at United Airlines when Newark airport started looking like a ghost town in March 2020. After 28 years with the carrier, she still loved her work. But by the end of that month, she had hung up her blue uniform for the last time. She is still struggling with a sense of loss.
“I wasn’t at all ready to leave,” she said. “It hit me right between the eyes.”
Ms. Jones, 68, of East Windsor, N.J., retired to protect the health of her husband, George, who has multiple myeloma, a form of cancer. Fortunately, the Joneses had a nest egg, and United offered a retirement package that enabled her to keep their health insurance.
Patricia Scott has not been so lucky. Ms. Scott, a special-education teacher in Stockton, Calif., retired in January to preserve her own health. A grandmother of 10, she survived breast cancer in 2016; her oncologist told her she couldn’t risk catching Covid-19 by returning to the classroom. Now, at age 66, she is on financial quicksand. “My income is half what it was,” she said. She is single and in debt. “I’m stressed, I’m depressed and I’m terrified.”
For many of the nearly three million workers ages 55 to 70 who have left their jobs since March 2020, retiring during the pandemic has inflicted two traumas. Like Ms. Jones and Ms. Scott, most felt they were forced out of work before they wanted to go, said Teresa Ghilarducci, a professor of economics and policy analysis at the New School for Social Research. Among that subset, the majority, like Ms. Scott, were financially unprepared, Ms. Ghilarducci said.
research from the New School, far more older workers retired during the pandemic than during other recessions. After the 2008 financial crisis, for example, 1.9 million older workers left the labor force in the first three months of the recession. In the first three months of the pandemic last year, 2.9 million left the work force. The latest data shows that 1.7 million of the newer wave of retirees left despite financial uncertainty, Ms. Ghilarducci said.
Their departures generally were not a bid for a few extra years of bird-watching. “A lot of people were pushed out of their jobs,” Ms. Ghilarducci said; she attributed that push partly to age discrimination. “It used to be that employers would let the ones they just hired go first in a recession, but this time older people who have been in their jobs the longest have been hit hardest.”
Lack of enforcement of anti-discrimination laws was a factor, she said. So was what some employers saw as a rare opportunity created by the pandemic to get rid of older workers, who are perceived to be less productive and more expensive.
Regardless of the reason, the new army of reluctant retirees, disproportionately made up of Black workers and those who lack a college degree, according to June data from the New School, is in trouble. One key reason: Debt rates among Americans 65 and older are the highest they’ve ever been, Ms. Ghilarducci said. And they are likely to rise as more people are forced to draw down their assets to make ends meet. Collecting Social Security earlier than anticipated will add to their vulnerability, since claiming earlier will permanently reduce their benefits.
Even for people with a financial safety net, the hurdles can be significant. “There’s a lot of stress that comes with having retirement forced on you,” said Malcolm Ethridge, a financial adviser in Washington who has several newly out-of-work older clients. “It takes time to get past the disruption.”
Jovan Johnson, a certified financial planner in Atlanta, said Ms. Scott and others in her situation should start looking for a pro bono financial adviser who can help make sense of their money. “There are a lot of us out there who will help people out for free during a crisis,” he said. He recommends searching sites like the XY Planning Network.
The primary benefit of sitting down with a professional may be relief from panic, he said. But the 15 new retirees who have contacted him for pro bono help since the pandemic started, among them nurses and teachers, have also gained a better understanding of how to manage limited funds. “Everybody deserves to have a plan,” he said.
Pen and Brush after 23 years as executive director, the stress started last year, when she contracted Covid-19 and spent several weeks in an intensive care unit. She was not psychologically ready to retire, but because she has still not fully recovered, she felt she had to. “I was one of those people who was going to have to be wheeled out of there, I loved it so much,” she said.
Now she is adjusting to what she said was a more limited routine. Sunday nights and Mondays flummox her the most. “It’s like when you have that dream where you have a final exam and you’ve never been to class, or you forget your locker combination. I keep thinking, I have to go to work.” Instead, she takes walks with her husband, Wallace Munro, a retired actor, and visits the grocery store more than she thought she would ever want to.
“It’s something to do,” she said. “You have to restructure your life when something like this happens to you. It’s so easy to get depressed.”
Managing money in a sudden retirement
Mr. Johnson, the financial planner, offered tips on juggling your income and expenses when you’re thrust into joblessness with little warning.
Make sure that you do not have any old pension or 401(k) money out there from previous employers. People who have rolled over retirement accounts from previous employers often forget about them.
Don’t feel guilty for taking Social Security early — especially if you have no other option. You can begin claiming your benefits as early as age 62. However, the downside to claiming before your full retirement age (you can look it up on the Social Security website) is that your total monthly payments will be permanently reduced. If your income is below a certain threshold, your full Social Security payments might be tax-free.
Use Social Security payments for your nondiscretionary, fixed expenses and retirement assets for discretionary expenses, such as travel and entertainment.
Bridge the gap to Medicare, because the age of eligibility is 65. Consider plans under the Affordable Care Act. Typically, if your income is low enough, you may receive premium tax credits and other benefits if you choose a plan on the marketplace.
If Social Security and retirement savings cannot sustain your lifestyle, it’s time to consider Medicaid, Supplemental Security Income and similar programs.
David Gross, an executive at a New York-based advertising agency, convened the troops over Zoom this month to deliver a message he and his fellow partners were eager to share: It was time to think about coming back to the office.
Mr. Gross, 40, wasn’t sure how employees, many in their 20s and early 30s, would take it. The initial response — dead silence — wasn’t encouraging. Then one young man signaled he had a question. “Is the policy mandatory?” he wanted to know.
Yes, it is mandatory, for three days a week, he was told.
Thus began a tricky conversation at Anchor Worldwide, Mr. Gross’s firm, that is being replicated this summer at businesses big and small across the country. While workers of all ages have become accustomed to dialing in and skipping the wearying commute, younger ones have grown especially attached to the new way of doing business.
And in many cases, the decision to return pits older managers who view working in the office as the natural order of things against younger employees who’ve come to see operating remotely as completely normal in the 16 months since the pandemic hit. Some new hires have never gone into their employers’ workplace at all.
banking and finance, are taking a harder line and insisting workers young and old return. The chief executives of Wall Street giants like Morgan Stanley, Goldman Sachs and JPMorgan Chase have signaled they expect employees to go back to their cubicles and offices in the months ahead.
Other companies, most notably those in technology and media, are being more flexible. As much as Mr. Gross wants people back at his ad agency, he is worried about retaining young talent at a time when churn is increasing, so he has been making clear there is room for accommodation.
“We’re in a really progressive industry, and some companies have gone fully remote,” he explained. “You have to frame it in terms of flexibility.”
In a recent survey by the Conference Board, 55 percent of millennials, defined as people born between 1981 and 1996, questioned the wisdom of returning to the office. Among members of Generation X, born between 1965 and 1980, 45 percent had doubts about going back, while only 36 percent of baby boomers, born between 1946 and 1964, felt that way.
most concerned about their health and psychological well-being,” said Rebecca L. Ray, executive vice president for human capital at the Conference Board. “Companies would be well served to be as flexible as possible.”
Matthew Yeager, 33, quit his job as a web developer at an insurance company in May after it told him he needed to return to the office as vaccination rates in his city, Columbus, Ohio, were rising. He limited his job hunting to opportunities that offered fully remote work and, in June, started at a hiring and human resources company based in New York.
“It was tough because I really liked my job and the people I worked with, but I didn’t want to lose that flexibility of being able to work remotely,” Mr. Yeager said. “The office has all these distractions that are removed when you’re working from home.”
Mr. Yeager said he would also like the option to work remotely in any positions he considered in the future. “More companies should give the opportunity for people to work and be productive in the best way that they can,” he said.
Daily Business Briefing
Even as the age split has managers looking for ways to persuade younger hires to venture back, there are other divides. Many parents and other caregivers are concerned about leaving home when school plans are still up in the air, a consideration that has disproportionately affected women during the pandemic.
At the same time, more than a few older workers welcome the flexibility of working from home after years in a cubicle, even as some in their 20s yearn for the camaraderie of the office or the dynamism of an urban setting.
I get to exercise in the morning, have breakfast with my kids, and coach little league in the evenings. Instead of sitting in an office building I get to wear shorts, walk our dog, and have lunch in my own kitchen.” Chad, Evanston, Ill.
V.A. issues vaccine mandate for health care workers: “I am a VA physician and strongly support this decision. Believe it or not, I know and work closely alongside several frontline healthcare workers who are not vaccinated for COVID-19, almost all of whom have chosen to avoid the vaccine as a result of misinformation and political rhetoric.” Katie, Portland.
As China boomed, it didn’t take climate change into account. Now it must.:“I think this article really highlights the fact that capitalism is, and always will be, completely incapable of addressing long term existential threats like climate change.” Shawn, N.C.
“With the leverage that employees have, and the proof that they can work from home, it’s hard to put the toothpaste back in the tube,” he said.
Fearful of losing one more junior employee in what has become a tight job market, Mr. Singer has allowed a young colleague to work from home one day a week with an understanding that they would revisit the issue in the future.
doctrinaire view that folks need to be in the office.”
Amanda Diaz, 28, feels relieved she doesn’t have to go back to the office, at least for now. She works for the health insurance company Humana in San Juan, P.R., but has been getting the job done in her home in Trujillo Alto, which is about a 40-minute drive from the office.
Humana offers its employees the option to work from the office or their home, and Ms. Diaz said she would continue to work remotely as long as she had the option.
“Think about all the time you spend getting ready and commuting to work,” she said. “Instead I’m using those two or so hours to prepare a healthy lunch, exercising or rest.”
Alexander Fleiss, 38, chief executive of the investment management firm Rebellion Research, said some employees had resisted going back into the office. He hopes peer pressure and the fear of missing out on a promotion for lack of face-to-face interactions entices people back.
“Those people might lose their jobs because of natural selection,” Mr. Fleiss said. He said he wouldn’t be surprised if workers began suing companies because they felt they had been laid off for refusing to go back to the office.
Mr. Fleiss also tries to persuade his staff members who are working on projects to come back by focusing on the benefits of face-to-face collaborations, but many employees would still rather stick to Zoom calls.
“If that’s what they want, that’s what they want,” he said. “You can’t force anyone to do anything these days. You can only urge.”
Infections and deaths in Turkey from the coronavirus have been declining steadily following a strict three-week national lockdown, which is expected to be lifted gradually through May.
Turkey so far has fully vaccinated about 13 percent of its population of 83 million people; about three million more have received their first dose, according to Our World in Data, an online compendium of data from global sources.
While the country is currently facing a vaccine shortage, forcing it to delay the administration of second doses, the health minister, Fahrettin Koca, said 30 million more doses of the Pfizer-BioNtech vaccine would arrive in June and 50 million doses of the Sputnik V vaccine are expected to arrive from Russia within six months.
Turkey has remained open to tourists, including Americans, throughout the pandemic. Most international arrivals are required to show proof of a negative PCR test taken within 72 hours of their arrival into the country.
Coronavirus tests are not required for passengers arriving from places that Turkey considers epidemiologically safe, which include Hong Kong, China, Taiwan, Vietnam, Australia, New Zealand, Singapore, Thailand, South Korea, Israel, Japan, Latvia, Luxembourg, Ukraine and Estonia.
Passengers arriving from Brazil, South Africa and India will be required to quarantine for 14 days in government-assigned accommodations and will be released if they test negative for the virus after day 10.
Turkey offers health insurance packages starting at as little as $15 that cover foreign visitors for Covid-19 treatment and hospitalization for up to 30 days. The country treats coronavirus patients in both public and private hospitals and opened 17 new hospitals last year to provide more intensive-care capacity for Covid treatment.
The Biden administration is moving in a new direction. It is trying to help low-income Americans by pushing for direct cash assistance in addition to expanding health insurance.
Each is a laudable goal. But doing both at once may not be feasible, as lawmakers raise concerns about the total price tag of Biden’s plans.
If the administration has to make hard choices, it can do more to help the poor by prioritizing cash transfers over expanded health insurance. That’s because cash helps recipients directly, while health insurance would pay mainly for care that many uninsured people were already receiving at low or no cost.
For over a decade, health insurance expansions have dominated the budget and politics of legislation directed toward the poor. In 2019, the government spent more than $600 billion on Medicaid — the major health insurance program for low-income Americans. This was more than 10 times the amount spent on the largest cash transfer program, the earned-income tax credit.
legislation enacted in March brought a welcome shift in focus toward cash benefits. Among its temporary provisions were about $100 billion in increased payments to low-income families with children and $15 billion in stepped-up wage subsidies for low-income workers, overshadowing the approximately $35 billion in new spending for health insurance.
The evidence indicates that for the low-income recipients of these programs, cash transfers will provide a greater bang for the government’s buck. Two separate studies that my collaborators and I conducted found that, on average, low-income adults would benefit more from a dollar in cash than a dollar of government spending on health insurance.
These kinds of comparisons are inherently difficult. One approach we took to measuring the value of health insurance to recipients was to see how much they were willing to pay for it. Another was to estimate the effects of such insurance on their lives, like improved health and increased economic security. Neither approach is airtight.
But they gave very similar answers: The benefit of Medicaid coverage received by a newly insured adult is less than half what that coverage costs taxpayers, which is about $5,500 a year.
The reason is simple: The uninsured already receive a substantial amount of health care, but pay for only a very small portion of it, especially when their medical bills are high.
estimated that 60 percent of government spending to expand Medicaid to new recipients ends up paying for care that the nominally uninsured already receive, courtesy of taxpayer dollars and hospital resources. In other words, from the recipient’s perspective the alternatives are $5,500 in cash or only about 40 percent of that — $2,200 — in health insurance benefits, on top of the care they were already receiving.
The United States has a longstanding tradition of providing free medical services to the indigent. Hospitals emerged in the 18th century largely to care for those with no other sources of help. In modern times, federal and state governments have enacted a grab bag of policies to help defray some of the costs incurred by hospitals and clinics in providing humanitarian care.
The result is today’s health care safety net for the uninsured. It is grossly inadequate and inefficient. It needs a radical overhaul.
But in the meantime, the direct benefits from expanding insurance to the low-income uninsured are, paradoxically, limited by the imperfect patches currently in place. Hospitals are major beneficiaries of health insurance expansions, which reduce their financial burdens and increase their profit margins.
Health insurance has always been an important financial tool for hospitals. During the Great Depression, they pioneered the first widespread health insurance in the United States to help ensure payment for provided care.
More recently, in 2006, when Senator Mitt Romney was the Republican governor of Massachusetts, he embraced the state’s health insurance expansion — which became the blueprint for Obamacare — as a way to reduce the costs that uninsured patients imposed on hospitals and taxpayers. Hospitals later used similar logic in lobbying for Medicaid expansions under Obamacare and against their repeal.
Of course, the newly insured have also benefited greatly from health insurance expansions. On this point, the evidence from Obamacare is in, and the research results are clear: Medicaid coverage is better than the safety-net care available to the uninsured.
saved lives. They also increased access to medical care and reduced medical debt, which can impose substantial financial and emotional pain on patients and their families, even though most of it is never repaid. Covering some of the remaining 30 million Americans who are still uninsured would most likely produce similar benefits.
But people in need also benefit greatly from cash. And there is evidence that cash transfers can also save lives.
In addition, a large body of work shows that wage subsidies to low-income workers with children help lift their families out of poverty, increase economic self-sufficiency, and improve their health and well-being. A recent experiment found that wage subsidies very similar to the ones that were temporarily expanded in March also increase employment and earnings for low-income adults without dependent children. Likewise, direct cash transfers provide important benefits to families and their children, whose academic achievement and physical and mental health can improve as a result.
In an ideal world, everyone would have health insurance and sufficient income. But in the real world, budgetary and political constraints often force wrenching trade-offs.
There are powerful moral imperatives for making sure that everyone has adequate medical care, as well as sufficient income for their nonmedical needs. It’s hard for economists to weigh competing moral imperatives.
But we can, at least, stack dollars on scales. And the good done by cash transfers tips the scale in their favor.
The Biden administration is now trying to make permanent its temporary expansions of both cash subsidies and health insurance. If forced to prioritize how best to help those who are struggling economically — either because of the coronavirus pandemic or from longer-term, structural obstacles — it’s time to recognize that cash is more effective than insurance.
Amy Finkelstein is the John and Jennie S. MacDonald professor of economics at the Massachusetts Institute of Technology.
When Fan Jianhua had her third daughter last April, she was afraid that she would be fined for violating China’s birth limits.
Ms. Fan was already heavily in debt paying for treatment for her 6-year-old, who has leukemia. To her relief, when she registered her new baby with the police, she didn’t have to pay the $7,500 fine.
“I was really happy and could finally relax,” said Ms. Fan, 34, a stay-at-home mother in the central city of Danjiangkou, in Hubei Province.
Slowly, in fits and starts, China’s ruling Communist Party is loosening its long-held restrictions over childbirth and women’s bodies. Some local governments have tacitly allowed couples to have more than two children. Beijing has said civil servants will no longer be fired for such infringements. Party leaders have pledged to make population policies more inclusive, a signal that some have taken to mean the rules will be eased further.
decline in birthrates. A once-a-decade population census, released on Tuesday, showed that the number of births last year fell to the lowest since the Mao era. Low fertility translates to fewer workers and weaker demand, which could stunt growth in the world’s second-largest economy.
But the party is wary of giving up control and has resisted scrapping birth restrictions wholesale. Instead, Beijing has been taking a piecemeal approach by slowly dismantling the once-powerful family-planning bureaucracy and carving out exemptions. In many places, police officers, employers and city officials are deciding how strictly, or loosely, to enforce the rules.
That can mean more freedom for some, like Ms. Fan, to have more children. But it also creates uncertainty about the risks, adding to a reluctance about having more children.
The strategy could also founder amid broad cultural changes. Anxiety over the rising cost of education, housing and health care is now deeply ingrained in society. Many Chinese simply prefer smaller families, and the government’s efforts to boost the birthrate, including introducing a two-child policy in 2016, have largely fizzled.
“If the restrictions on family planning are not lifted, and they are encouraging births at the same time, this is self-contradictory,” said Huang Wenzheng, a demography expert with the Center for China and Globalization, a Beijing-based research center. He said that removing all birth limits would convey an important message. “I think such a step has to be taken.”
official murmurs about a reconsideration of the one-child policy surfaced but were quickly dismissed. It took years before the government moved to allow all couples to have two children.
Now, the population is aging more rapidly than those of many developed countries, including the United States, and some argue that the government cannot afford to keep any restrictions on procreation.
“We have to take advantage of the fact that a certain number of residents now are willing to give birth but aren’t allowed to,” China’s central bank said in a working paper it published on April 14. “If we wait to lift it when no one wants to give birth, it will be useless.”
harshly enforced family-planning rules in what Beijing has depicted as a fight against religious extremism. The campaign has led in recent years to a rise in sterilizations and contraceptive procedures — forcibly imposed in some cases — in the region’s Muslim-dominated areas.
China’s family-planning policy has long given local officials a powerful weapon of control — one that may be hard, or costly, to wrest back. Before they were unwound, family-planning agencies hired around eight million people, down to the village level, who corralled women to be fitted with intrauterine devices or coerced them into abortions.
The officials also collected large fines from couples who broke the rules. One senior researcher at the Central Party School estimated in 2015 that the fees amounted to between $3 billion and $5 billion annually.
In recent years, the government has been reassigning family-planning employees to roles including in population research and tackling Covid-19. But local governments retain the power to enforce birth limits as they see fit, which has led to inconsistencies.
The central government said in May last year that civil servants did not have to lose their jobs for violating birth limits, yet months later, a village committee in the eastern city of Hangzhou fired a woman after she had a third child — prompting a public outcry.
Ultimately, the fate of China’s family-planning policies may change little. A generation of highly educated women are putting off marriage and childbirth for other reasons, including a rejection of traditional attitudes that dictate women should bear most of the responsibility of raising children and doing housework.
Liu Qing, a 38-year-old editor of children’s books in Beijing, said getting married and having children were never in her future because they would come at too great a personal cost.
“All the things that you want — your ideals and your ambitions — have to be sacrificed,” Ms. Liu said.
Ms. Liu said Chinese society imposed a motherhood penalty on women, pointing to the discrimination that mothers often faced in hiring.
“I’m furious about this environment,” she said. “I’m not the kind of person who would accept this reality and compromise. I just won’t.”
For other Chinese, having fewer children is a matter of necessity when holes in the country’s social safety net mean that a major illness can lead to financial ruin.
Ms. Fan, the woman in Hubei who was spared a fine, said that she and her husband, a laborer, were getting increasingly desperate. Public health insurance had covered half the cost of her daughter’s treatment for leukemia, but they were on the hook for $76,000.
She had a third child only because she heard that a sibling’s cord blood could help in the treatment of leukemia. But she later learned that such treatment would cost more than $100,000.
“I don’t dare think about the future,” Ms. Fan said. She added that if her daughter’s condition deteriorated or they went broke, they would have to give up treatment.
“We can only leave it up to her fate,” she said.
Research was contributed by Claire Fu, Liu Yi, Albee Zhang and Elsie Chen.
For millions of retirement savers, the pandemic was a gut punch. There was the jarring stock market drop in March 2020, then millions lost their jobs, health insurance and ability to fund their savings.
The pandemic stymied adults who hadn’t started saving for retirement, the number of workers taking withdrawals from their 401(k)s last year jumped, and some companies cut their 401(k) matching contributions.
John F. Wasik, a writer for The New York Times, spoke with financial advisers about the seven steps people can take now to catch up on their retirement savings:
Track your total spending. Spending has the biggest impact and is the input you have the most control over, said Clari Nolet, a certified financial planner and certified divorce financial analyst.
Focus on health insurance. When many people lose their jobs, they lose health insurance coverage for themselves and family. Those laid off can often continue their insurance under a COBRA plan, said Lori Price, a certified financial planner — but it can be onerously expensive.
Make catch-up contributions. If you’re 50 or older, the Internal Revenue Service gives you a little savings plum: You can save as much as an extra $6,500 annually in your defined contribution plans (which include 401(k)s, 403(b)s and 457s).
Automate your savings. If you’re working and offered a 401(k) with automatic payroll withdrawals, you can simply increase your contribution. Want to save even more? Many plans allow you to increase your 401(k) savings when you get a raise.
Adjust your portfolio. Just socking more money into a bank money-market account won’t help you catch up much at all. Yields on money markets are awful — the top rate nationally was 0.60 percent, according to Bankrate.com.
Retire later. If you’re able, one simple strategy is to retire after the “normal” age for Social Security benefits, which is 66 for most Americans. That will give you more time to save. Social Security will even pay you more each month if you wait until 70 to collect benefits.
Set up your own plan. Small-business owners or those who are self-employed can set up their own plans, from Simplified Employee Pension I.R.A.s to 401(k)s.
When Graham Brooks received his ballot in early February, asking whether he wanted to form a union at the Amazon warehouse in Alabama where he works, he did not hesitate. He marked the NO box, and mailed the ballot in.
After almost six years of working as a reporter at nearby newspapers, Mr. Brooks, 29, makes about $1.55 more an hour at Amazon, and is optimistic he can move up.
“I personally didn’t see the need for a union,” he said. “If I was being treated differently, I may have voted differently.”
Mr. Brooks is one of almost 1,800 employees who handed Amazon a runaway victory in the company’s hardest-fought battle to keep unions out of its warehouses. The result — announced last week, with 738 workers voting to form a union — dealt a crushing blow to labor and Democrats when conditions appeared ripe for them to make advances.
annual letter to investors that the outcome in Bessemer did not bring him “comfort.”
“It’s clear to me that we need a better vision for how we create value for employees — a vision for their success,” he wrote.
WASHINGTON — Senior Democrats on Monday proposed a tax increase that could partly finance President Biden’s plans to pour trillions of dollars into infrastructure and other new government programs, as party leaders weighed an aggressive strategy to force his spending proposals through Congress over unified Republican opposition.
The moves were the start of a complex effort by Mr. Biden’s allies on Capitol Hill to pave the way for another huge tranche of federal spending after the $1.9 trillion stimulus package that was enacted this month. The president is set to announce this week the details of his budget, including his much-anticipated infrastructure plan.
He is scheduled to travel to Pittsburgh on Wednesday to describe the first half of a “Build Back Better” proposal that aides say will include a total of $3 trillion in new spending and up to an additional $1 trillion in tax credits and other incentives.
Yet with Republicans showing early opposition to such a large plan and some Democrats resisting key details, the proposals will be more difficult to enact than the pandemic aid package, which Democrats muscled through the House and Senate on party-line votes.
afford to lose only eight votes, Representative Tom Suozzi, Democrat of New York, warned that he would not support the president’s plan unless it eliminated a rule that prevents taxpayers from deducting more than $10,000 in local and state taxes from their federal income taxes. He is one of a handful of House Democrats who are calling on the president to repeal the provision.
And in the Senate, where most major legislation requires 60 votes to advance, Senator Chuck Schumer of New York, the majority leader, was exploring an unusual maneuver that could allow Democrats to once again use reconciliation — the fast-track budget process they used for the stimulus plan — to steer his spending plans through Congress in the next few months even if Republicans are unanimously opposed.
While an aide to Mr. Schumer said a final decision had not been made to pursue such a strategy, the prospect, discussed on the condition of anonymity, underscored the lengths to which Democrats were willing to go to push through Mr. Biden’s agenda.
The president’s initiatives will feature money for traditional infrastructure projects like rebuilding roads, bridges and water systems; spending to advance a transition to a lower-carbon energy system, like electric vehicle charging stations and the construction of energy-efficient buildings; investments in emerging industries like advanced batteries; education efforts like free community college and universal prekindergarten; and measures to help women work and earn more, like increased support for child care.
The proposals are expected to be partly offset by a wide range of tax increases on corporations and high earners.
would have temporarily removed the cap, but it stalled in the Senate and attempts to include it in pandemic relief legislation were unsuccessful.
“It has to be elevated as part of the conversation,” Mr. Suozzi said. “There’s a lot of different talk about going big and going bold and making significant changes to the tax code. I want to make SALT part of the conversation.”
Frequently Asked Questions About the New Stimulus Package
The stimulus payments would be $1,400 for most recipients. Those who are eligible would also receive an identical payment for each of their children. To qualify for the full $1,400, a single person would need an adjusted gross income of $75,000 or below. For heads of household, adjusted gross income would need to be $112,500 or below, and for married couples filing jointly that number would need to be $150,000 or below. To be eligible for a payment, a person must have a Social Security number. Read more.
Buying insurance through the government program known as COBRA would temporarily become a lot cheaper. COBRA, for the Consolidated Omnibus Budget Reconciliation Act, generally lets someone who loses a job buy coverage via the former employer. But it’s expensive: Under normal circumstances, a person may have to pay at least 102 percent of the cost of the premium. Under the relief bill, the government would pay the entire COBRA premium from April 1 through Sept. 30. A person who qualified for new, employer-based health insurance someplace else before Sept. 30 would lose eligibility for the no-cost coverage. And someone who left a job voluntarily would not be eligible, either. Read more
This credit, which helps working families offset the cost of care for children under 13 and other dependents, would be significantly expanded for a single year. More people would be eligible, and many recipients would get a bigger break. The bill would also make the credit fully refundable, which means you could collect the money as a refund even if your tax bill was zero. “That will be helpful to people at the lower end” of the income scale, said Mark Luscombe, principal federal tax analyst at Wolters Kluwer Tax & Accounting. Read more.
There would be a big one for people who already have debt. You wouldn’t have to pay income taxes on forgiven debt if you qualify for loan forgiveness or cancellation — for example, if you’ve been in an income-driven repayment plan for the requisite number of years, if your school defrauded you or if Congress or the president wipes away $10,000 of debt for large numbers of people. This would be the case for debt forgiven between Jan. 1, 2021, and the end of 2025. Read more.
The bill would provide billions of dollars in rental and utility assistance to people who are struggling and in danger of being evicted from their homes. About $27 billion would go toward emergency rental assistance. The vast majority of it would replenish the so-called Coronavirus Relief Fund, created by the CARES Act and distributed through state, local and tribal governments, according to the National Low Income Housing Coalition. That’s on top of the $25 billion in assistance provided by the relief package passed in December. To receive financial assistance — which could be used for rent, utilities and other housing expenses — households would have to meet several conditions. Household income could not exceed 80 percent of the area median income, at least one household member must be at risk of homelessness or housing instability, and individuals would have to qualify for unemployment benefits or have experienced financial hardship (directly or indirectly) because of the pandemic. Assistance could be provided for up to 18 months, according to the National Low Income Housing Coalition. Lower-income families that have been unemployed for three months or more would be given priority for assistance. Read more.
He is among the Democrats who have requested a meeting with Mr. Biden to discuss repealing the cap, according to a letter obtained by The New York Times.
“No SALT, no dice,” declared another Democrat, Representative Josh Gottheimer of New Jersey.
“There’s plenty of ways, in my opinion, to raise revenue and reinstate SALT,” he said in an interview, adding that he wanted to see the full details of the proposal.
budget blueprint that was approved last month to include the infrastructure plan, which would enable them to undertake a second reconciliation process before the end of the fiscal year on Sept. 30 and pass it with a simple majority.
Elizabeth MacDonough, the parliamentarian, will have to issue guidance on whether doing so is permissible under Senate rules.
If Democrats succeed, they could potentially use the reconciliation maneuver at least two more times this calendar year to push through more of Mr. Biden’s agenda.
SEATTLE — By the end of Monday, thousands of yellow envelopes mailed to a squat brick building in Birmingham, Ala., will hold the fate of one of the most closely watched union elections in recent history, one that could alter the shape of the labor movement and one of America’s largest employers.
The envelopes contain the ballots of workers at an Amazon warehouse near Birmingham. Almost 6,000 workers at the building, one of Amazon’s largest, are eligible to decide whether they form the first union at an Amazon operation in the United States, after years of fierce resistance by the company.
The organizers have made the case in a monthslong campaign that Amazon’s intense monitoring of workers infringes on their dignity, and that its pay is not commensurate with the constant pressure workers feel to produce. The union estimates that roughly 85 percent of the work force at the warehouse is Black and has linked the organizing to the struggle for racial justice.
Amazon has countered that its $15 minimum wage is twice the state minimum, and that it offers health insurance and other benefits that can be hard to find in low-wage jobs.
stopped construction on an office tower when Seattle wanted to tax the company, and backed out of plans to build a second headquarters in New York City after facing progressive opposition.
But the company has committed more than $360 million in leases and equipment for the Bessemer warehouse, and shutting down the vote of a large Black work force could publicly backfire, said Marc Wulfraat, a logistics consultant who closely tracks the company.
Regardless of the outcome, Mr. Wulfraat said that the election is a sign Amazon has work to do. “For most companies that end up with labor organizing in some capacity,” he said, “it didn’t come about because they were doing a fantastic job managing people.”
If the union loses, Amazon will lose at least one customer: Michael Render, the rapper who goes by Killer Mike. Appearing alongside Mr. Sanders on Friday, he said, “If that vote does not go through, if these conditions do not improve, I won’t be ordering from Amazon again.”
Sonam Vashi contributed reporting from Bessemer, Ala.