insideyournwa.com

In the next couple of months an economic stimulus package will be shipped out to basically anyone who files a tax return. This check that will be mailed will be $300 - $600 for individuals and $600 - $1200 for married couples with an additional $300 for each eligible child.

Now there are a few things that immediately make me question this.

First and most obvious I won’t be sending mine back but other than a short fix I don’t believe this does much for us. Retail sales are flat or declining and discretionary spending is down. It is easy to see that if people had more money in their pockets they would spend more on a whim and spend more on luxuries. The problem is that this isn’t going to permanently fix things - in fact it will likely stimulate China’s economy more than ours since that is where all of our goods are made.

Next it is curious to me that this comes in an election year. One with a huge battle and more people interested then ever. While gas prices rise causing inflation on everything we buy and people already upset over government spending in Iraq. Now the government in both parties are saying “we care, see here is a check”.

Also curious to me is that they are harping on you have to file your taxes before you are eligible. Is this targeted towards people that haven’t filed because they don’t want to pay their low liability? For example if you are married with a tax liability of $400 and you haven’t wanted to pay, you would pay this year because you would turn your $400 into $1200. I am far off base here but it is something to kick around.

So what can fix the problem? I have heard a few really good proposals and Shea has written his version and it will be posted here shortly. Some of the things I can see are simple even though the solutions are not. We simply cannot spend hundreds of billions of dollars a week in Iraq. I do not want to hear anything about why we went, what we are trying to do, or any of that, simply how we are going to stop that spending. Next gas prices have to be lowered. Again I don’t care what they are paying in Sweden for gas, our price has to go down if we want to “stimulate” our economy. When a family can barely afford to drive to work let alone school, activities, and recreation; it is easy to see that spending will be down. We don’t have extra money to spend that is the simple truth.

Increased minimum wage will only drive prices higher and more jobs over seas so all we have is lower prices. We can’t have lower prices because everything is delivered by gas or diesel powered vehicles and we can’t (yeah right) lower gas prices. Lets just use ethanol you say? That is great if you don’t like eating anything with corn in it. I am including cows, chickens, pigs, and their byproducts like milk, eggs, etc. We are straining our corn supplies as it is.

Stay tuned for Shea’s economic stimulus package to see what his thoughts are on the subject. Please lets try to look farther than the end of our nose and look toward the future.