Go forth and spendify

TUESDAY 4-22-08…Only a few more weeks to go before the IRS starts sending out checks. No, I’m not talking about normal tax refunds. The economic stimulus checks. It  represents the federal government’s efforts to stimulate the economy. You see, this country’s economic engine gets two thirds of it’s power from consumer spending. If consumers stop spending, the engine begins to sputter. The longer consumers refrain from spending, the power of the engine is sapped.

Why aren’t consumers spending? Apparently, the federal government didn’t find it necessary to look into that aspect. It saw the engine sputtering and decided to add a little bottle of octane to stimulate it. If my car’s engine started sputtering, I’d wanna’ know why.

In the case of the economy, higher prices at the gas pumps, in the grocery stores, restaurants, shops, mortgages, inflation in general, has pushed prices far beyond the discretionary money in people’s pockets. What money they do have goes for the essentials, gas and groceries. Everything else takes a back seat.

So, the federal government decided “We better give the people back some of their money.” Thus….the economic stimulus checks are due to start arriving in May. I wonder if the government realizes that it is admitting that it has been taking too much of our money by way of taxes, and that it is giving back some of the excesses it has taken from us?

If in fact it succeeds in stimulating the economy, will the federal government decide to permanently cut everyone’s taxes? You’d think so, huh? If the federal government is giving us back some of the money it took from us, and it succeeds in stimulating the economy, wouldn’t it stand to reason the government should let us keep more of the money we earn, and make the Bush tax cuts permanent?

Remember, it was our lack of spending which made the government realize the economic engine was sputtering. So, the government adds a bottle of octane to the engine. What happens when the bottle of octane (stimulus check) is used up? Does the economic engine begin to sputter again. If keeping money in consumer’s pockets was the sole purpose of keeping the engine running, wouldn’t it be prudent to cut everybody’s taxes so they’d be able to keep more of the money they’ve earned?

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One Response

  1. […] bsnotebook wrote an interesting post today on Go forth and spendifyHere’s a quick excerptNo, I’m not talking about normal tax refunds. The economic stimulus checks. It represents the federal government’s efforts to stimulate the economy. You see, this country’s economic engine gets two thirds of it’s power from consumer … […]

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