How would you spend your check?

Posted at 10:38 AM on January 18, 2008 by Mike Mulcahy (2 Comments)

President Bush didn't give many specifics, but he says an economic stimulus package should include "direct and rapid" tax relief for individuals. He's talking about an overall tax relief plan that could total $145 billion.

An AP story today said both the White House and Democrats are talking about tax rebates:

Back in 2001, Bush added refunds of up to $300 per individual and $600 per household as a recession-fighting element of the tax cut plan that had been the centerpiece of his 2000 campaign.

Economists said a reasonable range for tax cuts in the new package might be $500 to $1,000. A White House plan is looking at rebates of up to $800 for individuals and $1,600 for married
couples.

Congressional leaders are talking about smaller rebates, in the range of $500 for individuals, but they have yet to work out the details.

So, how would you spend the rebate? Or would you save it? Or does it go right to Xcel Energy to pay this month's heating bill?

By the way on Midday at noon Gary Eichten will talk to state economist Tom Stinson and Paul Anton, chief economist at the Wilder Research Center about the economy. Earlier this week when Stinson said Minnesota is already in a recession, Gov. Pawlenty said he was being pessimistic.

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Comments (2)

I don't see how any of the ideas proposed thus far can have any significant, long-term impact on the economy. Yes, for a lot of people, an $800 windfall will be a big help - for a month, maybe two's worth of bills/expenses. But it does nothing to solve the underlying problems, which are stagnant wages, excessive debt and a stalled housing market. What's $800 going to do - put off foreclosure for a month?

Having said all that, I'm not certain about what appropriate alternatives might be, particularly in the short term. If we look at what made the 90s better than the 00s, it was wage growth - everybody did better financially, not just top-tier earners. Seems like we need to boost the economy in a way that will create the kind of job growth that produces higher wages. It almost seems like we just have to suck it up, for now, take our lumps & struggle through a period of belt-tightening.

Posted by bsimon | January 18, 2008 11:36 AM

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I think I will put the money into a CD or savings account and hope the interest will help with my retirement in 30 years.

Posted by Brian Hanf | January 22, 2008 9:26 AM

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