It looks like the proposed $250 Social Security stimulus check which was announced by President Obama late last year is unfortunately not going to be sent out.
On March 3, the Senate voted down the proposal for a $250 bonus check by a score of 50-47.
The reason that the plan was voted down was because of the cost. It was estimated that sending out the $250 checks to Social Security recipients as well as SSI recipients would have cost about $14 billion dollars. Considering the current deficit is at record levels, the Senate decided that some cuts had to be made. The other reason is that the Social Security payments are indexed to inflation which is why they were increase 5.8% last year, so to give a bonus when inflation is low, defeats the purpose of the indexing.
Just last week Senator Bunning held up another important vote on extending long term unemployment benefits in a rather bizarre one-man show of fiscal restraint.
The government is on pace to run up a record $1.6 trillion deficit this year because of various stimulus spending including $66 billion dollars on various unemployment extension benefits.
The $250 Social Security payment was being considered to make up for the fact that the Social Security payout did not have a cost-of-living increase this year because of low inflation.
The $250 check was paid out last year to Social Security recipients, SSI recipients and a few other groups as well.
Is there any chance of another $250 stimulus check this year?
This Bill is dead in the water but that doesn’t mean a similar Bill couldn’t be created. I personally doubt that there will be another check this year but if the cost-of-living increase for 2011 is zero or close to zero percent then I think the odds would be quite good that another $250 bonus check would be approved.
How many senior citizens does this effect?
There are about 55 million senior citizens receiving Social Security who would have been eligible for this bonus payment. Although the check amount is not huge, it will be interesting to see what effect, if any this will have on future elections. It was widely expected that this stimulus payment would be paid out by March of 2010 and there will be an awful lot of disappointed, and possibly angry senior citizens who might be thinking that they have been short-changed $250 by this vote.