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My Thoughts On The $100 Billion Dollar Fiscal Stimulus Package.

I think it’s a load of crap – I won’t hold anything back here. G.W.’s (and now the Democrats as well) brilliant plan to give out around $100 billion dollars to “stimulate the economy” will do nothing of the sort. There are of course the people that will view it as a gift from the government (like they see tax refunds too) and buy themselves a plasma TV, and that of course will, I suppose, stimulate the economy a bit…at least at Best Buy. But here is the question we really should be asking (if we actually had a say in the matter):

Where is this money coming from?

We are borrowing to pay for everything nowadays because Bush has spent us into the poorhouse – between the war, the mega-tax cuts for the rich, our national debt and failing international trade. We cannot even afford to travel internationally right now because our dollar has become so worthless overseas. And yet we still have $100 billion to hand out to every person in the country? No, we actually don’t…it will be paid for by us, just not today. But eventually it will be, same as all the other debt that has been racked up in the past 8 years. The National Debt has continued to increase an average of $1.44 billion per day since September 29, 2006, and is now at around $9,207,038,602,594. Each person’s share of this debt is around $30,000…how does it feel to owe that much? So glad I paid off my credit cards, only to find myself back in debt. Because eventually we will be paying it back…in the form of new fees, taxes, pay cuts, etc. It will be coming, so be ready for it.

So who will spend this “free” money to stimulate the economy?

“Getting money to low and moderate income people is good in the sense of getting a bang for the buck” because they tend to spend it quickly, Bernanke said.

Yep, they are depending on the low and moderate income people to correct the economy. Not the corporations, who are getting a giant tax cut in the form of equipment rebates, and not the rich, who will just put this money right into their bank accounts. The poor and lower middle class are being depended on to take their $600 and go shopping. Not to save it, not to put it into a retirement account, but to spend it right away. Remember after 9/11 Bush told us all that “going shopping” is the best way to help recover from the terrorist attacks? Well we have been spending trillions of fake dollars since then and the hole we are going to find ourselves in is getting deeper and deeper.

Wanna see something funny I found on the Treasury website?

How do you make a contribution to reduce the debt? Make your check payable to the Bureau of the Public Debt, and in the memo section, notate that it is a Gift to reduce the Debt Held by the Public. Mail your check to:

Attn Dept G
Bureau Of the Public Debt
P. O. Box 2188
Parkersburg, WV 26106-2188

Yep, you can just send them a check right now. Maybe we should just send our “stimulus” check back to them? Nah, I am sure they would find a way to spend it right away. Me? Putting it right in the bank for when that bill comes due down the road.

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Comments (26)

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  1. I hear ya…I don’t mind getting some money back but the reasoning behind it is poor! $100 billion? Imagine what that could do to the school system? Why, that money could create a program to teach children about money and personal finance so we never have a mortgage crisis again. I bet there would be plenty of money left over for new school and teacher funding. What if it were used for scholarships? Maybe relieve student loans for people who work in the public sector (teachers, police, fireman, etc…).

    Oh well, enough of my rant. Let’s hope people make good decisions with the money and help themselves financially rather than help themselves at Best Buy!

  2. David says:

    I know, it’s crazy huh? We have crumbling roads, terrible school systems, a dangerous health care industry, etc that we don’t have money for…and yet we “find” $100 billion (or more) to give away. Scary what has become the priorities in this country.

  3. Mike says:

    Yes $100Billion could be used to pay off the large national debt that we have accumulated, but what would that do to our economy? And why are you hating on the corporations for getting a tax break? Corporations and capitalism are the foundation and core of this country.

    For you to say that the Fed expects the ‘low and moderate income people” to correct the economy, is just plain idiotic. The Fed uses Open Market operations, stimulus packages, along with a variety of other tools to control the economy. Are you going to be that person who turns around and sends that refund check right back to the the Gov’t? If not, then quit complaining.

  4. david says:

    Mike:

    “”Getting money to low and moderate income people is good in the sense of getting a bang for the buck” because they tend to spend it quickly, Bernanke said.”

  5. Sam says:

    This is exactly the reason that people need to vote for Ron Paul. He is the ONLY candidate talking about solutions to pay down this debt without outrageous taxation and inflation.

    He’s way ahead of his time, and chances are people in 10 years will be wondering why Romney kept laughing at him in all the debates since he will be proven right.

  6. *applause*

    *fans self*

    LOVED THIS POST! You are soo on point here! This is what Ive been telling everyone in my family. WE are paying for this “kickback rebate”. This is just money that we already gave them during the year and now we are getting it back as a way to pacify those of us who are concerned about the economy. I share your the same sentiments about Bush and his putting us into the poorhouse. The nerve of them asking US to contribute back to the public fund when we already pay in via taxes, inflation and pay cuts.

  7. david says:

    Very funny Girls….

  8. Llama Money says:

    I agree that the whole stimulus package idea is terrible for the country. The last thing we need is more national debt. However, being the weak individual that i am, I want the bill to pass. Why? So I can pad my savings account.

  9. Chris Jones says:

    I don’t think I have enough information to make a judgment on the stimulus package. But if the FED does expect the poor and middle class to fix the economy with that money, they are sadly mistaken. Myself, personally, I think that the FED should just be disseminated as it’s unconstitutional and Congress should go back to issuing their own currency that they don’t have to pay back with interest. And the IRS should also be disbanded as it is also against the constitution. But I do think that you are wrong on your opinion of the big corporations and very wealthy people, as it was upon capitalism that this nation was founded.

  10. I was just about to say that I rather pay off my portion of the national debt since as an American citizen, I am considered liable for that debt. All Americans are.

    Then I had to laugh when you mentioned the “debt relief” program offered by the Bureau of Public Debt.

    Then I had a light bulb go off, what if this is a tax write off too? Is it? Could it be a snowflake turning into a snowball by making a contribution to the public debt relief program? Keep paying our tax refunds till we as a nation is debt free?

    After all, we do tend to demand for more services, better education, and such…

    Great post.

  11. Deamiter says:

    Oddly enough, the stimulus package, along with the panicked drop in interest rates will probably stimulate the economy. The 2001 stimulus package did probably help to reduce the length of the recession and prop up market prices.

    With the decline in pension plans and the universal passing of responsibility for retirement to workers through 401(k) plans and the like, the government now relies on the market to keep a growing portion of Americans out of poverty. We’ve come to rely on 10% long-term gains in stocks and if they under-perform for even just a decade, millions of retirees will be in big trouble.

    When our (American) government bought into the debt culture with actions like draining the social security trust fund and raising the debt cap, they destroyed their ability to help support Americans in any long-term economic slump. It’s easy to dismiss retirement-fund losses as individual unwise investing strategy, but if the markets sharply correct, retirees in poverty will be a majority, not just a few unwise individuals.

    It’s been a few decades in the making, but America now largely relies on the stock market to take care of retirees. I don’t know where you are on the politics of economics, but I don’t think ANY president could afford to let the economy/stock market significantly slump right now because the number of people throw into poverty would be too huge for the nation to handle.

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  13. Sam says:

    I agree that the whole proposal is totally ludicrous, as is our current system of taxation. With household income well into six figures, I just figured out that our income tax this year is just shy of 9k. Our passel of kids and charitable contributions helped, but only paying 6.5% of our income in taxes is ludicrous to begin with, and now the government wants to send me a check for another $2400? You can bet I’ll be banking it along with the tax refund check because, just as you said, we WILL be paying it back, one way or another…

  14. david says:

    Thanks for the honesty Sam, I agree it is quite a dumb idea!

  15. Patrick says:

    I agree… I don’t like it, but I won’t turn the money down. It will go right into savings. I highly doubt Social Security will be around when I reach retirement age, so I plan on being well prepared for that day.

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  19. Sarah says:

    Great post. I am so happy to find a community of people who understand how insane this approach is. The media coverage has been appalling – some commentators get it, but they are the ones who are preaching to the choir. Overall there is just so little effort being made to educate the American people about what is really happening and why. Do Americans know that in other countries similar problems are beng addressed by RAISING interest rates, or that some foreign economies are booming despite paying nearly twice the price we do here for gas? This recession is not being caused by the price of gas and it sure won’t be fixed by shopping our way out of it. I spend a lot of time counselling bipolar people who have financial probs because of manic spending spress when they are having episodes – now the Fed, the Congress and the almost the whole US public seem to think this kind ofsspending is a financial solution and not a mental health issue. Amazing times!

  20. david says:

    Thank you Sarah, I am glad there are others that “get it”. :-) This is not free money from the govt, it is just them giving us money in advance, that we will pay back many times over in new taxes in the next couple of years. People are falling for it though, including the media, which is terrible.

  21. [...] for answers before offering their own solutions. Some bloggers, however, are openly skeptical about a recession, stimulus, or government intervention. And now, the Canadian bloggers are even joining in [...]

  22. [...] have made my feelings known about the economic stimulus check and how I think it is both a waste of time and money, but if you are sitting around waiting [...]

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  25. Pete says:

    i heard that the govt was borrowing the money for the package from china. i pray to God that isn’t true. anyone hear such a thing? or is someone just trying to get me going?

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