I’m commenting because I have a blog and I can. I am no economist.
The first thing that strikes me as odd about an “economic stimulus package” is where the money comes from. The government only has the money it collects in taxes, or in this case, the money it will collect in taxes. That is, it’s our money, that the government is going to give back…to us. Except that, it costs money to collect the money and it costs money to redistribute it back to us, which means, that the government is losing money overall. It would have been a lot cheaper to just let us keep it to start with.
Except, it’s not like they’re giving me back exactly the money I paid or anything. Almost all of us, so I’m told, are going to get between $300 and $600. But I, for example, paid more than $600 in taxes last year. The people getting $300 didn’t pay any taxes last year. People like Bill Gates, that theoretically paid substantially more in taxes last year than I paid, will still get about $600 or whatever. Of course this $600 won’t effect Bill Gates at all, and won’t stimulate the package…er economy. The $600 to me, yeah, that’s going to help me pay some bills and pay down some debt. Not exactly stimulating but moreso than what Bill and Melinda are going to do with it (unless they end up giving it to some inner city school, and bully for them if they do!). But that $300 to the people who make the least, yeah, that’s going to get used right up.
So what we have here, essentially, if I’m hearing it right, and if we stop right here in our “money cycle” is government-sponsored wealth redistribution: Taking money, in the form of income (and other) taxes, and giving it to people (unprogressively, I might add) that don’t pay taxes. Which is a blatant admission, if ever there was one, that trickle down economics doesn’t work, and that if you want to have a healthy economy you need to get more money into the hands of the people that will spend it.
But, I want to restate something I just said. The government will be passing this package of forced wealth redistribution so that less well-to-do people will spend it. Presumably on things they need like milk and AAA batteries, but with a $300 lump sum, it could just as likely end up as an ill-afforded down payment on a Rent-to-Own plasma screen TV. Whatever. The point is that it’s a government-sponsored wealth redistribution plan, redistributing wealth from the public coffers and to private enterprise.
Yikes.
Like I said, I’m no economist but I’m seeing a lot of things I don’t like here. I’m seeing the government praying to High Heaven that we don’t ask the tough questions about why a plan that’s good for “stimulating” the economy isn’t also good for long-term economic stability. I see them avoiding the issue of how a stronger corporate “tax” in the form of an increase in the minimum wage wouldn’t take more money from the very richest, and put it in the hands of the people who need it the most and thereby create a sustainable, strong economy. I’m seeing them avoid the issue of the failure of capitalist hierarchies. I’m seeing them shy away from an admission of the social failures of corporate greed.
Unfortunately I’m also seeing them feed government money, public money, tax money, back into the hands of the very people that caused the problem to start with. Every gallon of milk, every loaf of bread, every credit card payment, every iPod bought with that tax rebate was bought with money that could have paid for sewage infrastructure, highway repair, more teachers, better schools, lower insurance premiums, lower energy prices, advances in reusable energy and other social causes the increased price of which have caused our average cost of living to go up while wages have stagnated.
Furthermore, it’s an admitted band-aid. It doesn’t fix the issue that caused the problem. It doesn’t punish the guilty. It doesn’t stop a mortgage from defaulting. It doesn’t salvage the loan industry. It won’t stop the bankruptcies that will prevent millions from owning a home for the next seven to ten years. For that matter, the amount that is likely to be distributed is a spit in the ocean in terms of the amount that was “lost” in the housing crisis.
Should I, while I’m ranting, also mention that that money was not lost. It’s comfortably sitting in the bank accounts of billionaire executives at Citicorp and Merril Lynch and others. The money went up but it didn’t come back down. Those banks have been reporting “losses” lately, but those aren’t actual losses. Those are losses compared to last year’s ill-gotten gains. And it doesn’t matter, the guys and gals (but mostly guys) that raised expectations by arranging for multiple mortgage-sized thefts have filled their private coffers with annual and per-project bonuses, with 7- and 8-figure salaries, and with exit packages large enough to buy a third world nation.
And…
They’ll be getting a tax rebate.
If there was any justice, the ones that caused the problems by talking out of both sides of their mouths will be stripped of million-dollar legal aid and forced to defend their duplicitous business dealings with the aid of C-average public defenders. And, when they inevitably lose because of their inability to semantically twist the laws’ intents, they will have to buy the houses they stole and give them to the people that bought them.
That would be justice, that would be an economic stimulus package, and that would be a warning to all the other dollarmongers out there in the world looking for the next big loophole.
Of course, that would never happen, that would never work, and that would shut down the spirit of “entrepreneurship” that “makes this country great.” So, y’know, there’s that.