President Donald Trump introduced a snag in the Covid relief package passed by both chambers of Congress earlier this week after being hammered out by large bipartisan groups over the last few months.
“I am asking Congress to amend this bill and increase the ridiculously low $600 to $2,000,” he said, referring to the amount most American taxpayers who file as a single person would receive. Americans who earned over $75,000 in 2019 would see that amount reduced by $5 for every $100 of earnings over $75,000.
Statement by Donald J. Trump, The President of the United States
— Donald J. Trump (@realDonaldTrump) December 23, 2020
What it will take to get the bill signed into law may come down to a math problem. Let’s work with both Mr Trump’s number and Congress’s idea of phasing out the relief for individuals who already make lots of money. The current formula is
where p is a function that defines the payment taxpayers would receive based on agi, their adjusted gross income in 2019. Plotting this function starting at $75,000 (everybody lower than $75,000 will get $600) shows it hitting zero at $87,000:
What if, instead of flattening the line at $600, we continue the same phase-out function and turn it into a phase-in function, where people who make less than $75,000 will get more money up to a maximum of $2,000? That keeps everybody over $75,000—those who might not need the money as much—right where they are in the current bill but sends more to people who earned less last year.
This function flattens out to the left, with a payment of $2,000, at $47,000 but still hits a $600 payment at earnings of $75,000 and a zero payment at $87,000:
The new formula would be:
with a designation that the maximum value would be $2,000 and the minimum value would be $0.
Of course, the bill itself is so complex that it has been noted as the largest single bill ever passed in the history of the United States. And that is saying something. Since I believe Mr Trump would like to brag about doing something that’s the “biggest,” let’s get this worked out and signed into law. States, local businesses, and individual Americans are in need of this disaster relief as soon as it can be sent to them.