Have
you received your economic stimulus check yet? I haven’t,
but the first wave went out last week.
The checks flooding the nation’s mailboxes and bank
accounts are the result of an economic stimulus package
passed by Congress and signed by President Bush back in
February. The checks are part of the $168 billion package
and are targeted at boosting consumer spending, which
accounts for a huge percentage of the American economy.
As often happens when something goes through the
crucible of Congress, the stimulus package is far more
complicated than it could have been.
Eligibility for the check is based on one’s income as
shown on one’s 2007 tax return. To be eligible for the
full amount, one must have earned between $3,000 and
$75,000 for individuals or between $3,000 and $150,000 for
couples. If one earned above the maximum amount, then one’s
stimulus check will be reduced by 5 percent of the amount
above the maximum until one gets nothing.
You may have noticed that the bottom income threshold
includes a lot of people who paid no federal income taxes
at all. If a person made $3,500 in 2007, they didn’t pay
a dime in federal income taxes, but they will receive a
check nonetheless.
But before all of you folks earning over the maximum
threshold get upset about people receiving a check who
didn’t pay any federal income taxes, there are some
other facts that should be considered. The stimulus
package is not a tax refund. The income thresholds are
there to target it at people whom a bunch of politicians
deemed worthy to receive it - not at those who paid the
taxes to fund it. The federal government also did not
reduce any spending to pay for it. Instead, they merely
added to the federal deficit to pay for it. It’s a
straight handout.
Congratulations. We’re all on welfare now.
We all know the real reason for the stimulus package,
don’t we? After all, few people think it will change the
fundamentals enough to actually change our economy. It’s
like tossing a few bucks to a guy with a "will work
for food" sign. It won’t change a thing. The real
reason for the stimulus package is quite simple: the
politicians in Washington wanted to pose for cameras and
say that they "did something." Simple enough,
eh?
The politicians in Washington may get the credit they
crave - whether they deserve it or not. The numbers for
the first quarter - from earnings to employment - are
better than expected. The economy is not in recession, nor
has it receded for a single quarter. The economy isn’t
great, but it’s not collapsing either.
Many people are beginning to see the economy in full
recovery as soon as the third quarter of this year. If
that comes to pass, expect the politicians to take credit
and cite the stimulus package for staving off a recession.
That’s bunk, of course, but false credit is the currency
of politics.
When you receive your stimulus check, the politicians
want dearly for you to go spend it. They don’t care on
what you spend it. Just spend it. Buy a television. Buy a
Wii. Buy a new couch. Buy a reciprocating saw. Whatever.
They don’t care. They just want you to spend in a way
that would make the politicians proud.
America’s retailers are stepping up with deals to
help you spend your welfare check. Sears and Kmart are
offering 10 percent to anyone who trades in their check
for a gift card. Wal-Mart is offering to cash the checks
for free and is cutting prices on certain groceries if you
buy them with your check. Pick ‘n Save is also offering
a 10 percent incentive if you convert your check to a gift
card. A $300 check could be converted to a $330 gift card.
Despite what the politicians want you to do, you should
feel free to spend your check as you see fit. If you have
some debt, pay some of it down. If you want to invest the
money, go right ahead. If you want to save the money for a
rainy day, that’s fine too. If you want to give the
money to your favorite charity, have at it.
The point is that nobody should view their stimulus
check as merely free money to be blown on a frivolous
purchase. Yes, it’s a welfare check, but it’s not like
you can give it back. Incorporate it into your budget and
spend it wisely. At least spend it more wisely than our
politicians would. That should be easy.
(Owen B. Robinson, a West Bend
resident, is a blogger who publishes at www.bootsandsabers.com. His column usually runs Tuesdays
in the Daily News.)