Floating in the wake of a recession, the U.S. government first refused to acknowledge that the recession existed. Now, they want to attempt to pull us out in a way that hasn’t been done before and may not even work.
The Economic Stimulus Act of 2008 passed in January, when the government finally bowed down to the force of recession. It hopes that by giving taxpayers a little boost ($300-$600), people will go out, spend the money and, in turn, stimulate the economy.
I don’t know about anyone else, but if I were given a $300 check, it would be an immediate payment on a credit card or happy addition to my savings account. Since we are amid a recession and so many people are going through a rough time, how many of them are really going to think to themselves, “An extra $600? Wow, I better go buy that new car” or “I really wanted a new dishwasher”? In places where the economy has been a little kinder, maybe quite a few people will be thinking of making big purchases.
The National Retail Federation estimates that taxpayers will spend 40 percent of their stimulus checks in stores and apply the rest to savings. Retailers are certainly hoping so.
All across the country, retailers are putting together deals to entice people to spend their stimulus checks. Kroger Co., which owns Sears, K-Mart and Fred Meyer, has already said it would give out discounts to people who turn their stimulus checks into gift cards. Home Depot is encouraging spenders to use their stimulus checks to improve the environment by purchasing eco-friendly products from the company.
Personally, a $300 check would certainly not encourage me to go out and spend more money. Not to say that I wouldn’t appreciate an extra $300, but trying to entice me to buy something more expensive is ludicrous, since the nature of recession is that we don’t have a lot of money. It also seems odd that the company imagines people will put only 60 percent of their $300-$600 (more if you are married and have kids) into paying bills. Maybe the government just hopes the taxpayers really enjoy spending more than getting out of debt.
I had wondered where this magical money was coming from that the government couldn’t find when schools cried out for help (and are still crying, actually). I discovered that the government is borrowing it from investors who buy bonds from the government. It’s pretty much a loan on interest from these bonds that our children will mostly be paying back in about 30 years.
All around, we’re just taking advantage of future generations. The government first deprives funding for proper books and facilities, as well as underpaying teachers, and then takes out a loan to help people who paid taxes that will be repaid by the same children who were deprived the best education possible.
If it was so easy to borrow money from these bond investors, then why didn’t we borrow it and just apply it to the areas that needed it most? Not to say that consumers or taxpayers are ignorant, but we will do with our checks as we wish, and probably won’t pay much attention to how the government wants us to spend the money. If the government had borrowed the money with a primary purpose, it should have just taken the money and applied it where it had intended.
The biggest joke of all is that the stimulus is being given to us early. It’s actually intended for 2009, so at this time next year, the government will be recalculating and finding out who should have received more money and who should have received less. At the moment, the government is also saying that if some taxpayers receive more money than they were really supposed to, they get to keep it even after it’s been recalculated.
The big question is, why are they paying out this money now at a flat rate, when it could be wrong? Is the government really that concerned about job security that it needs to create a giant mess that it will have to clean up later?
The stimulus package is just not thoroughly thought out. People will spend their money however they feel, and it may not stimulate the country’s economy, making this a giant waste of money for the government when they could actually be spending it on something that surely needs it.