Looking Forward To Receiving and Not Spending My Economic Stimulus Rebate Check
Published 1/25/08 (Modified 3/8/11)
Note: If you wish to understand more about the the 2008 Economic Stimulus Package, please read my entry regarding the tax stimulus rebate payments. I have also updated the subject with an entry discussing the possibilities of a 2009 economic stimulus check as well.
In response to the dramatic drag on the economy caused by the developing housing crisis and mortgage meltdown, the federal government has finally stopped dragging its knuckles on the ground and sprung to action - proposing to send taxpayers rebate checks in an effort to jump start the economy. Under the current bipartisan proposal, most taxpayers would be eligible, with $600 checks going towards individuals who pay taxes, $1,200 going towards working couples with an additional $300 for each children, and even $300 going towards anyone who earned a paycheck even if they made too little to pay income taxes. Many details in the package have yet to be hammered out including the business stimulus portion that provides additional tax breaks for businesses that purchase capital equipment as well as the housing assistance portion that helps riskier borrowers, who have been shut out of the tanking subprime mortgage market, qualify for Federal Housing Administration (FHA) loans.
The current tentative proposal still needs to be be rammed through the House of Representatives, the Senate, and ultimately approved by the President to be made official, but so far the likelihood of it happening looks very promising. There is great congressional and presidential pressure to speed this through the system and officials have indicated that the government may start sending checks out as soon as 60 days after the measure has been passed, which could happen in the next few weeks. Of course this economic stimulus is going to come at a hefty cost of $150 billion - nearly 1% of the value of the nation's entire economic activity for one year. How the U.S. can afford this type of price tag, with additional tax cuts on the way, while at the same time waging expensive wars in the Middle East and maintaining our military bases in other parts of the world is beyond me.
I Am Eagerly Awaiting My Rebate Check - Although I Don't Think It Was Designed For Me
I am excited at the prospect of having free money land into my grubby paws. I'm always on the lookout for ways to earn and generate additional streams of income, so financial windfalls certainly don't hurt! Of course, my rebate check may not be as high as I would like because under the current proposal, there is an exemption for individuals who earn more than $75,000 a year, or couples making $150,000 or more. Higher income taxpayers are likely to get reduced rebate checks or none at all. Rats.
But truth be told, the check isn't going to help the economy much if it falls into the hands of people like me. It's being proposed as a Band Aid measure to rescue the economy from a possible recession by pumping money back into the American marketplace as quickly as possible to spark fiscal activity. The idea is to get cash into the hands of lower and middle income people because they are more likely to quickly spend it out of financial necessity thus creating a greater and more immediate impact on the economy. Unfortunately for the plan, those with comparatively higher incomes such as myself are more likely than not to stash it away and save the windfall funds in some online savings account or use whatever rebate checks we get to pay off debt. There's nothing wrong with saving or paying off debt, except that's not what the government had in mind. It's going to be a disappointment for the government and the economy, but I personally don't plan to spend whatever windfall amount I receive - I plan to save it!