My Much More Awesome Economic Stimulus Plan
Author: Nick
Category: Money
Topics: economy, politics
I can hear the poor people partying in the streets over the announcement of an economic stimulus package which will include hefty tax rebates for low-income folks—both the genuine kind of poor people and the “I only have a 56-inch HDTV and 600 satellite channels” kind. Under the plan, various people making under $75,000 (or under $150,000 for couples) will get back anywhere from $300 to $1,200 in the form of a tax rebate. “Tax rebate” is a nice way of saying “the government is going to cut you a check so you stop complaining about how bad the economy is.”
Unfortunately, the wizard of economic analysis that I am, I have determined that this economic stimulus plan will not help ward off the looming recession for three very subtle yet painfully obvious reasons:
- Writing checks to stupid people is stupid. I promise you that 90% of the money issued by this tax rebate plan will go straight to drugs, booze, and hookers. And that’s just my share!
- $300 cash isn’t going to help anyone. Most people who get their check will blow through that money in 24 hours or less. Yes, the purpose of the rebate is to encourage spending. But really, how much spending can you do with $300? One iPod, maybe some Pokémon cards. That’s it.
- It includes too many not-so-poor people. In some parts of the country, a couple making $150,000 a year is considered filthy rich. The folks on the richer end of the rebate spectrum will likely put their money into savings or use it to pay down debts—something that’s not going to do anything for an economy that needs more consumer spending.
I spoke to President Bush about this earlier and offered some alternatives to this plan, but he wasn’t able to respond because I was talking to a TV broadcast of him. Despite that, I think I got my point across when I suggested one of the following options as a substitute for this economic stimulus package which is destined to miss its mark. I’ll share my alternatives with you now so you can judge for yourself.
Ten Much Better Ways to Stimulate the Economy
- Send all $150 billion of the package to me. I will use that money to buy every household in America a George Foreman grill and the thickest, juiciest steaks that $1.99/pound can buy.
- Cut out the rich folks. Save the tax rebates for the five or ten percent poorest people in the country. They are much more likely to re-inject it into the ailing economy with spending on things they don’t need like expensive jewelry, designer jeans, and fancy cars (Chevy Aveos for all!)
- Send gift cards instead. Give everyone a $300 Target gift card. They’d kill two birds with one stone—consumer spending would soar, and Wal-Mart would be driven out of business.
- Put on the biggest party in history. Use the money to host an annual Economic Stimulus Party that spans every city in America. It’ll make Times Square on New Years Eve look like your child’s third birthday party.
- Fund “Take a Penny, Leave a Penny” containers around the country. I can’t remember the last time I’ve actually seen a penny in one of these things. How about sticking a Benjamin in each one and renaming it to “Take a Hundred, Leave a Hundred?”
- Start another war. These seem to be great for our country. How about we go after a country we could actually use for once, like Sweden. Then we could import all those hot Swedish women into the U.S. and help make our country look pretty again.
- Instead of spending it on Americans, spend it on Iraqis. I think we could make Iraq a very peaceful country just by dumping a few plane-loads of cash all over it. Most insurgents are probably just angry because they can’t afford a nice pair of shoes. That money might help turn them from following a religion of hatred and violence to one of material goods and wealth, just like us!
- Subsidize the rising price of milk. People getting stingy with their money and grumpy in general because they’re not getting enough calcium. Fear of brittle bones and rotting teeth are driving people to stash their cash or spend it on cheaper drinks like bottled water and beer. Milk, it does an economy good!
- A Nintendo Wii for every household. I don’t know why; I don’t know how; I just know that doing this would turn the economy around instantly. Or it might cripple it irreversibly as people stay home and play videogames all the time. There’s only one way to find out for sure!
- Pay the Hollywood writers to get back to work. If I don’t get some new episodes of Heroes and How I Met Your Mother soon, I’m going to stop spending money out of spite.
Of course it’s likely that none of my clearly superior economic stimulus options will be exercised, but I’m still looking forward to spending my $300 to help rejuvenate the economy. Though I can’t help but think that $300 worth of beef jerky might not be the best thing for me.
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17 Responses »
1.
Frugal Dad
January 24th, 2008 at 9:27 pm
You know that “Wii in every household” isn’t a bad one at all! I know my family would buy in. We could pitch the idea as a way to fight childhood obesity (and adult obesity, for that matter). Wii after-school competitions could eliminate gangs, teen drug use and further reduce teen pregnancy rates.
2.
Mrs. Micah
January 24th, 2008 at 9:45 pm
I’d like to have our groceries subsidized. But the money will go to the car payment. That’s kind of the consumer economy, right?
3.
Kacie
January 25th, 2008 at 9:44 am
Your plan is way more awesome. Between Target gift cards and the well-stocked “take-a-penny” trays, we’ll be set!
4.
rocketc
January 25th, 2008 at 11:43 am
$300 to a bunch of poor people isn’t going to help the economy. . .but $20K to a couple of “rich” people who own a small business might.
5.
LJ
January 25th, 2008 at 12:45 pm
I like the Target gift cards idea for sure.
A Wii for every household has the potential to bring about world peace, so I am all for it.
I am not sure if our family will qualify, but I do agree that giving this money to people who are making 6 figures does seem a little odd.
And if they give this money to everyone, how many people will actually SPEND it? I think most will save it or use to pay down debt or something similar. I can’t see people going out and buying a new Ipod Touch just to show some patriotic love.
Take Care
LJ
6.
Stephanie @ PoorerThanYou
January 25th, 2008 at 3:14 pm
Pretty much the only poor person this is going to help is… me. $300 makes a big difference to me, but that doesn’t really matter, because I’m just going to put it toward my credit card debt, and not spend it like they want me to.
On the other hand, all of my working college friends will go out and spend in on booze, so maybe this plan does have some merit. Also, that means some rocking parties for me to go to!
7.
Obbop
January 26th, 2008 at 1:30 am
Oh sure…… it may be worth $300 when first proposed but the time we get it the purchasing power will likely be closer to $275.
8.
Disgruntled
January 26th, 2008 at 3:06 pm
If the feds can afford to dole out these rebates now, then why did they take so much from us in taxes to begin with? They gave themselves an interest-free loan!
As tempting as it is to buy a Wii, I think it might be more fun to cash the rebate check and stowe the unspent money under a matress. Just for spite.
9.
Jeremy
January 28th, 2008 at 10:14 am
In response to #2 - The idea of a tax rebate is to give back to taxpayers a percentage of what they paid into the system, but under your plan, it wouldn’t be a tax rebate, more like a gift. The poorest 5 to 10 percent of Americans don’t pay any income tax at all. It would just be a gift, which, by the way, there is a provision for within this plan already.
10.
RealHDTV
January 29th, 2008 at 4:26 am
Your list sounds pretty cool but i am afraid whether it is possible to implement it .I do agree there are many who don’t pay the tax they are required to pay but they still get the benefit . Sending gift cards is really kind of you and I am sure you need to become the next president after George Bush if you wish to implement this wish list and high time you started your campaign.
11.
Fiscal Musings
January 31st, 2008 at 9:08 pm
I don’t really see how the stimulus plan will help much, but I’m not going to say no to a check. I’ll most likely do something sensible with it though.
It’s also interesting how everyone is so excited about getting what they refer to as free money from the government. When did we forget that it was our money that they took in the first place (that is if you’re a contributing (read… not a bum) member of society). And how’s that for nested parenthesis…?
12.
Eric
February 16th, 2008 at 10:50 am
Hmmm,
We are exporting billions of dollars to oil/natural gas exporting countries, billions that are not taxed to nothing by circulating through our economy, thus adding to the US defecit. We are also funding countries with questionable political agendas. Oil companies are reaping massive profits due to record oil prices on the oil they pump. High energy prices reduce our disposable income so we buy less goods and services, contributing to an economic slowdown.
A solution…
Tax breaks, or increases to existing tax breaks for improvements that save on the amount of energy we use to heat/cool our homes. What will this do?
1. Save energy, lower imports, reduce price of energy by reducing demand. This lowers the transportation, and manufacturing costs for goods, lower prices for food, etc.
2. Lower pollution
3. Directly inject the money into the US economy.
4. Provide support for the construction industry.
5. Increase property values in a property value shrinking market.
6. Reduce need for bailing out the subprime mess due to falling propery prices, and also putting a few dollars due to energy saving into the pockets of those having to pay their adjustable mortgages.
7. More benefits if I took more time to think of them, but I gotta end this post now.
Where is the downside to this? Even landlords could take advantage of this, which could reduce rent hikes due to rising energy costs.
Looks like damn near everybody wins, except maybe the oil companies, and the countries we import electronics from.
Eric
13.
solwoldjr
February 22nd, 2008 at 9:49 am
Great read. Very entertaining. I think the thing that most people are missing (except for a few of the repliers) is that this is a REBATE. A rebate is a partial return following a purchase. If you didn’t pay taxes, then you didn’t make a “purchase” hence nothing to return.
Giving money to people who didn’t pay in is a freebie. It is a redistribution of wealth. I am sure that congress could’ve changed the language from “Tax Rebate” to “Redistribution of Wealth”, but it really isn’t that catchy.
Anyway people will spend this money for sure. Even if they pay off credit card bills with it, they will soon close that gap and max out those cards again. I am putting in a concrete driveway with my REBATE. Married with three kids, finally they start bringing in some cash!
What a country!
14.
rich
May 6th, 2008 at 4:19 pm
I like how some people are saying that the tax stimulus was their money to begin with. That would be the case if we were running a balanced budget with a surplus and had no national debt, but it is actually money borrowed from foreign countries, namely china. Sorry, but unfortunately we don’t pay enough taxes to balance the budget so you should probably be getting a huge bill instead of a check, so take your check and stop bitching
15.
rich woman
June 7th, 2008 at 8:38 pm
I suppose stupidity accounts for poverty. That confirms my suspicions. I have no hope….
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