Not exactly a free lunch…
The cost of the $500 I’ll (tentatively) be receiving in the Spring isn’t being advertised to all of us by Congress or the President, but it’s basically future debt…because, oh wait, our government doesn’t have the money!
Now, since I’m paying MORE than enough taxes, I’ll be happy to contribute that cash to my tax bill or, heck, a new iPhone.
John Stossel sums up the problem of “economic stimulus” in the form of checks from the government:
The federal government is in the red. Bush’s new budget has a $400 billion deficit. There’s no lockbox with $100 billion in it. So to give everyone a tax rebate, the government will have to borrow more money. But that only moves the cash from one part of the economy to another. As Roberts says, “It’s like taking a bucket of water from the deep end of a pool and dumping it into the shallow end.” Unless the government cuts spending, which the theory says would neutralize the stimulus, the only other way to get the money will be to raise taxes or to have the Fed create money — inflation — which would raise the price of everything. How will that stimulate anything but the politicians’ short-term approval ratings?
