Responsible citizens will spend it all

Worldview Item of the Day for 25 January 2008

Congress and the President are slowly wending their way toward an “economic stimulus” package that has nothing to do with the economy and will only stimulate election year politics…

Unless the citizens of the republic of, by, and for the people take matters into their own hands and spend as much of the $103 billion dollars destined to them as possible.

Yes, stimulus plans can work, as long as those being asked to stimulate actually do that thing, which means spending $300 to $1200 sometime late this spring or early summer instead of saving it or paying off debts.

This idea works because that would be a $103 billion shot in the arm for the economy. Yes saving that money pays off in the long run, and reducing debt makes paying the bills easier, but $103 billion in capital directly infused into the free market creates jobs, encourages business investment, increases salaries, and thereby makes the stock market go up.

Granted, this whole idea is an exercise in making a bad idea work as well as possible. A far better idea would be to expand and make the tax cuts permanent, but responsible citizens can make this work if we want to.

Personally, I plan to support innovation with some of my cut of that $103 billion. I’ll probably invest some of it in a small business of my own. In that way, I will be directly contributing to the ongoing vitality of the American economy, thereby increasing profits, incomes, even tax receipts. That makes everybody happy.

What are you going to do?

-=DLH=-

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12 Responses to Responsible citizens will spend it all

  1. Kati says:

    Well I *had* thought of saving it, but that would be irresponsible. Besides, if the gov’t ever found out what I was planning to do, my check would likely get lost in the mail. šŸ˜‰

    So, I will probably buy a new laptop (one that doesn’t shock me every time I touch it would be SWEET!) and maybe get a jump on some Christmas shopping. Or hey, maybe I’ll get a Wii for my kids. Maybe all 3 – depends on how much we get and when.

  2. Eddy E says:

    I’m going to save it and encourage as many people as possible to save it. Why? 1. This is a bad idea; 2. If we save it we do the very thing we’re not supposed to do… maybe that will give the politicians a renewed sense / paradigm of how to stimulate an economy!

  3. chrispy85 says:

    I hereby promise to do my civic duty and spend my money quickly on American-made product(s).

    Like this, for instance:
    http://www.rrarms.com/catalog.php?prod=G51340

    But I’m with you. I think the tax-cut would be better. As someone wrote, a rebate will fill the malls for a couple of weekends, but a permanent cut would inspire businesses to make the sort of long-term investments, comitments, and decisions to boost the economy — and keep it strong.

    But I’m not gonna lie. I’ll enjoy the money when it gets here.

  4. dlhitzeman says:

    Chrispy,

    Oh, don’t get me wrong, I’ll enjoy it too in that instant-gratification-because-I-found-a-twenty-in-the-wash sort of way, not because I think it will help be be part of a long-term American economic revival.

    -=DLH=-

  5. dlhitzeman says:

    Eddy E,

    I agree that this rebate is a terrible idea, but as citizens, we also have a responsibility to take matters into our own hands. Maybe if they see $600 per person making a difference, they’ll make that $600 a permanent reduction.

    We can dream anyway…

    -=DLH=-

  6. dlhitzeman says:

    Kati,

    Go for the laptop and the Wii. They’re bot great ideas and economically stimulating too. I recommend this laptop with Vista Ultimate. That’s what I’m typing on right now, and I love it!

    -=DLH=-

  7. Wade says:

    I will be paying off my Home Depot card which was popped up to finish my kitchen just before Christmas.

    Thanks George, Obama, Hillary, McCain and Mike.

    Sorry Mitt, your just a govenor.

    WDR

  8. dlhitzeman says:

    I guess pre-spending is ok. As long as it’s for a good cause, like a kitchen.

    -=DLH=-

  9. djhitz says:

    What will $800 stimulate in our lives? There are 150 million full time emloyees in our 300 million population. Most of us are responsible enough to be trusted to invest our money wisely. Not a lot of people have the priviledge to be handed a sum like this. Most of us who make under the annual national average which is around $37,000. Is $800 really enough?
    If the government really wants us to stimulate the economy the we should get a substantial amount more under the condition that we invest it into national markets which are, wholesale, retail and investments.
    We, who own property are good consumers. We pay payments and other bills, all while keeping track of our costs of living.
    We working class really pay the check when it comes to bolstering international spending. Now we’re hearing that the Chinese has way more money than the US.
    Perhaps suggesting a higher tax credit is ludicrous. We need that money along with the streamlining of our national spending to help pay off our national deficit. It is a Leviathan, ladies and gentleman. The money for this tax credit supposedly is coming from foreign loans. How can this be? Don’t these foreign powers, owe us? The burden of this loan is put down on us into our old age or even to our children. What would happen to us any way if we balanced our national budget? How can we truly pay our bills?
    In the meantime, I’ll take the $800 just fine. It’ll be part of my summer vacation.

  10. dlhitzeman says:

    djhitz,

    I completely agree. Real economic stimulus comes from letting people permanently keep more of their money. Reducing the tax burden, whether by cutting rates or by increasing the size of the lowest tax bracket, would put more meaningful money in peoples’ hands than any kind of handout will ever be able to.

    That being said, I think one of the problems that our economy faces is the combined factors of “our eyes being bigger than our pocketbooks” as a nation combined with responsible spenders being spooked by the spectre of a failing economy. I both cases, these phenomena are the result of media–and government–misinformation about what is really happening with the economy.

    I can’t find the article now (I think it was on Real Clear Politics), but someone recently wrote about how the problems with the current economy are only that money that was not really there anyway is being exposed as not really being there (e.g.: forclosures on people who bought houses that were twice or three times what they could actually afford). The point being that the economy is shedding excess fluff in the same way that an animal sheds its winter coat in the spring. The economy and the animal are both better off for it in the end.

    As for stimulus, what we need to do us push our elected representatives to make the Bush tax cuts permanent and to expand the tax cuts to make them more meaningful. Of course, the only way we can do that is to elect representatives who will respond to that push, but that’s a subject for another conversation.

    -=DLH=-

  11. Pingback: Worldview - Blog Archive » Espresso for one

  12. djhitz says:

    Sure, I’m so tired of $4.00 cups of coffee at my, local coffee shop. I’ll just buy a $3000 espresso machine to save me money over about about a 13 year, period. I won’t ever need to go to the coffee shop again. It’s a whole mile a way. Think of the gas, I’ll save. I don’t even think about the fact that my double shot of espresso is two whole dollars more than a gallon of gas. First, I must look over properties on one of those bank sponsored, foreclosure bus tours. This confirms the obvious about vampires really existing, eh?
    All sarcasm aside, why in our deteriorating economy do we have coffee shops like, Starbucks serving cups of fancy coffee for 3,4,5 dollars? This about kills the bottomless cup priviledge. (By the way if you wait until summer and try their custom, lemonade at least one time. You will thank yourself. Just try not to get addicted.) Most patrons of these establishments make little more than $10+ and hour. Their stereotyped social, scene suggests they show up in their newly leased for $350 a month KIA, while wearing, name brand, clothes and shoes not smart for freezing cold weather. Do they have a job that prevents them from getting dirty all day? I know, I’m stereotyping but mark my words. I’ll settle for a $5 dollar box of good tea that lasts a month and I’ll drink it at home to save me the trouble of showing off my false status. I do have a friend, who owns a coffee house. I can get a double shot of espresso served Americano style for about $5+. He brews all his coffee with reverse osmosis, filtered water. He sells Kona, blend coffee, the strongest coffee, I know of for about $30 a pound. Alot of people buy it, too. My, WWII vetran, father was satisfied with a .60 cent, cup made with tap water until he got prostate pain that came from drinking several cups of black coffee (military mud) for 40 years.
    So Mr. Espresso for one: Nothing against you. I definately believe that a small bit of financial decadence can be OK. All good things in moderation is acceptable to this mild conservative. Rest assured though that if I buy an $80 pair of shoes, they won’t be Mootsie Toosie, penny loafers. They’ll be good sturdy, work boots that have a lot of support that will keep my overexerted feet dry and relatively warm assisted with some seven year old insulated socks that have been barely worn because our greenhouse winters haven’t been that cold.
    The point that we are trying to make is if we’re going to live, rich that that it shouldn’t break us. We also shouldn’t leave our debts to our children and grandchildren like our congress does. We’re still paying for Viet Nam, don’t forget.
    No thanks, Espresso for one. I’ll stick to travelling to some naturesque place, as far from common population, as we can go. It’s called going on vaction. The English call it going on “holiday”. Most of my family does it on an annual basis. It’s traditional and cool and frankly this land is your land, this land is our land from California to the New York islands. This land was made for you and me. I suggest we all go see it and not on TV. Actually go to places, like Yellowstone, Hocking Hills, Olympic National Park, Lassen Volcano National Park, Acadia, Gettysburg even Washington D.C.
    By the way DL, I love you comment you said about putting more meaningful into people’s hands. This is how my father’s money meant something. He was able to save something. I try to save money to pay bills with is about as far as it goes. I’m not saying, I don’t want to be taxed. I’m just saying that if beaurocracy was not forever adding on this cost and adding on that cost all the time maybe the cost of everything would not have almost unattainable. Maybe, I would be able to aquire the forgotten “nest egg” that the old ones were able to give themselves due to sensible spending and saving and a different kind of economy, one where credit wasn’t king. I don’t think most folks even heard of Espresso coffee back then. Dad bought his house for like $25,000 in 1966 and sold it for over $100,000. Who’d have thought his investment was that lucrative in ’66? A loaf of bread was like 15 cents in those days. People barely made $200 per week back then. I’m just pointing this out to some of our younger population.
    Yes, we also must vote in good governors, senators and congressmen as well as mayors, city and county councilmen, assesors, sheriffs, etc. We know we cannot always agree on everything but in a democracy if you are not corrupt. You can still come close to your piece of your action. We’re all welcome to come back and try again next election. Isn’t that lovely?

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