Curious to get people's thoughts on the $150 billion stimulus package that congress put through today.
If I understand the terms correctly, tax dollars that I paid out will be getting redistributed to people who paid less or no income tax. Sounds to me like nothing more than an effective increase in the marginal tax rate, which seems like a very short-run solution to a longer-term problem.
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i don't see at as an increase in marginal rates, just the damn government being robinhood agian.
ohhh and increasing the deficit.
And don't forget, some dems want to do this crap for anyone having trouble with making their mortgage payments too.
All crap if you ask me.
I feel like $300 to each family can hardly make a difference. It seems the money is spread too thin. Take the $150 billion and laser focus all of it on the areas that really need help.
Seems to me like "solution" that makes people feel better ("Hooray, free money!"), without actually fixing the problem.
I think each eligible HH gets more like $1,200. Still don't think it's the right approach though...
The government effectively did away with the 10% tax bracket. Now, the lowest tax bracket it 15% (remember - effectively). It helps out low-income households the most, which is the focus of all the sub-prime chatter. It may not make any sense for a banker making >$100k, but it makes sense for the sub-prime loan holder who makes $30k.
My two cents.
Two government bodies simultaneously conducting fiscal (congress) and monetary (the fed) policies seems like a very scatter-shot approach, and I think some are bound to get sprayed with pellets.
Below is a comment on WSJ that I found interesting (this was in response to a reader poll asking what people would do with their refund check):
"What rebate? I make over $150k. I'm funding this transfer of wealth intended to fuel the orgy of American consumerism.
The last time there were significant recessionary and inflationary pressures (circa 1980), it took Paul Volcker and the 1982 recession to take us from 1970's stagflation to 1980's expansion. Will the current monetary and fiscal policy only delay, perhaps with interest, the bitter medicine necessary to launch the next expansion of the American economy?"
This is NOT a "robinhood" move by the government. This stimulus package really only helps the rich in the end. The $300/600/1200 (whatever rebate bracket one is in) will either be spent on crap (DVDs, appliances, sex toys) boosting the dismal financials every company has been coming out with these past quarters (comically blaming "sub-prime" mortgages for their poor performances I might add). The board will be peachy and CEOs will be able to take a *short* breather.
Some of the rebate will go to paying bills easing Wall Streets worries of America's HORRIBLE spending habits (thanks to the whole credit revolution of "buy now, *try to* pay later").
The rest will go back to the banks to play with as they choose.
After 30 years at Goldman, Mr. Paulson also failed to remember the first lesson of his Econ 101 class at Dartmouth; whenever you dump a big bag of money on a nation, their currency will depreciate. China is loving this...
My analysis: The government is trying to dig us out of a hole. This is only meant to temporarily ease the shit storm on Wall Street and gain Republican support before the next election.
There an article in the weekend WSJ about your point on gaining Republican support. I thought it was interesting. Any thoughts?
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