The United States spent most of the aid and stimulus money

Nearly two years and six relief bills in the pandemic, the United States has spent the majority of its available Covid rescue funds. But billions of dollars in a handful of categories have not been spent.

Starting under then-President Donald Trump and continuing through President Joe Biden’s administration, Congress approved some $ 4.5 trillion in total aid spending, according to Treasury Department data. Federal agencies have formally committed to using approximately $ 4 trillion and to date have made $ 3.5 trillion in actual payments.

According to budget experts, it often takes a long time for the full amount of funds approved by lawmakers to reach the American people. This is because government agencies such as the Small Business Administration and the Department of Labor go through a process of legal commitment to a portion of the allocated funding, which is known as binding. They then start to actually spend it.

The roughly $ 500 billion in available relief resources that have not been committed may not be spent by agencies. There are deadlines for making these commitments, and they could stretch for years. Details also vary by program. Funds that are ultimately not committed are returned for other government uses.

What agencies can commit to spending may differ from the initial estimates presented in invoices, or they may simply plan to use the funds over a long-term period, said Kristen Kociolek, director of the financial management team. and insurance policy from the United States Government Accountability Office. . A Congressional Budget Office estimate US bailout spending of nearly $ 2 trillion in March 2021, for example, shows that 40% of total spending is expected to occur between 2022 and 2030.

Education, healthcare and disaster relief are among the areas where the government has spent only a portion of committed funds, according to a CNBC analysis of Treasury data compiled by the Pandemic Response Accountability Committee, or PRAC. The agency was created under the CARES law of March 2020 to support the monitoring of pandemic relief spending.

The government plans to use almost half of the remaining relief funds in the future, said Marc Goldwein, senior vice-chair of the Non-partisan Committee for a Responsible Federal Budget, or CRFB. A lack of demand may also have led to leftover money. Goldwein noted that a strong credit market could alleviate the need for paycheck protection program loans.

Some programs also ended up costing less than initially expected. For example, half of the US states removed enhanced unemployment benefits before the Labor Day deadline.

More money is available for education than any other category. Agencies have committed some $ 263 billion for primary, secondary and vocational education and nearly $ 60 billion has been spent to date, a difference of about $ 200 billion, the data shows.

The more than $ 200 billion in total education funding remains on the table in part because schools have until 2025 to spend it. Congress set aside the money in large part to help restart in-person learning, but schools across the country have reopened using only a fraction of the funding.

The GAO noted in October that some states have used the money for programs to stimulate students who fell behind during virtual classes due to low attendance or a lack of reliable internet access, among others. factors.

Policymakers also have a significant share of funding for health services, according to CNBC’s analysis. The government spent almost two-thirds, or $ 192 billion, of the roughly $ 303 billion committed, leaving $ 111 billion. GAO noted that much of the money committed to the Department of Health and Human Services is “available for a multi-year period or is available until spent.”

Agencies could use those funds as needed for efforts such as Covid-19 testing and treatment, according to Goldwein. Among the potential uses for the money, the government could buy doses of Pfizer’s upcoming Covid antiviral treatment, he said.

The government also has nearly $ 70 billion of the $ 114 billion committed for disaster relief, which can be deployed as needed in the future. For the first time during the pandemic, the United States used the Federal Emergency Management Agency’s Disaster Relief Fund – typically distributed in response to major natural disasters – to respond to a public health crisis .

In two of the most watched categories of pandemic aid, the government has spent almost every dollar committed. The United States spent all of the approximately $ 844 billion earmarked for direct payments to individuals, and sent all but $ 3 billion of the more than $ 830 billion committed for Paycheck Protection small business loans. Program.

The speed at which the virus has wreaked havoc on the economy and the lack of information on how to contain it have contributed to a particularly large and swift government response.

“Compared to past recessions, what took years has happened in weeks,” Goldwein said. “So the response was just as quick. “

The unprecedented aid was also motivated by conventional wisdom that Congress spent too little to tackle the Great Recession over a decade ago, prompting lawmakers to “err on the side of caution” this time around – ci, he added.

“A single pandemic relief program – the $ 800 billion Paycheck Protection Program (P3) – equates to the entire federal government response to the 2008-2009 financial crisis,” he said. writes PRAC president Michael Horowitz in the group’s report. semi-annual report to Congress published last week.

The original bills were aimed at putting money in Americans’ pockets as quickly as possible to replace lost income as the U.S. unemployment rate hit nearly 15% in April 2020. The process has been refined over the years. time, with additional restrictions added for PPP loans and additional unemployment benefits reduced to an amount that would replace lost wages for the typical worker rather than paying them more than they earned while working.

The bulk of the allowable spending comes from the CARES Act and the US bailout, bills passed in March 2020 and 2021, respectively. Much of the money has supported individuals and businesses, with more than $ 2 trillion in stimulus checks, unemployment benefits, and Paycheck Protection Program loans, according to estimates. PRAC and CRFB.

Estimates from groups such as the PRAC and CRFB that attempt to capture a broader scope of funding by including measures that are not directly related to spending, such as tax credits, assess the total cost of relief. of Covid to more than $ 5,000 billion. The PRAC tracker shows a total of $ 5.2 trillion in authorized funding, while the CFRB tally is $ 5.7 trillion.

Covid cases and hospitalizations in the United States are on the rise, and health officials are assessing the threat of the newly discovered omicron variant, which the World Health Organization says has the potential to change the course of the disease. pandemic. The remaining relief dollars have some degree of flexibility – the government can use health spending for testing or vaccination efforts, for example – but any significant changes would likely require legislation from Congress.

“You can’t take money that was supposed to be used for testing and use it to send checks to people,” Goldwein said.