Rebates are just about a done deal

[Rick Lee]

Wealth redistribution at its worst.

Deal Reached on Tax Rebates for Stimulus

Jan 24 11:16 AM US/Eastern

WASHINGTON (AP) - Democratic and Republican congressional leaders reached a tentative deal Thursday on tax rebates of $300 to $1,200 per family and business tax cuts to jolt the slumping economy.

Congressional officials close to the negotiations said House Speaker Nancy Pelosi and Republican Leader John Boehner of Ohio reached agreement in principle in a telephone call Thursday morning.

The officials, speaking on condition of anonymity, said the two wanted key members of their parties to sign off on the accord before any announcement.

The accord came as the White House said Thursday an agreement was imminent.

Pelosi, D-Calif., agreed to drop increases in food stamp and unemployment benefits during a Wednesday meeting in exchange for gaining rebates of at least $300 for almost everyone earning a paycheck, including low-income earners who make too little to pay income taxes.

Families with children would receive an additional $300 per child, subject to an overall cap of perhaps $1,200, according to a senior House aide who outlined the deal on condition of anonymity in advance of formal adoption of the whole package. Rebates would go to people earning below a certain income cap, likely individuals earning $75,000 or less and couples with incomes of $150,000 or less.

[Jim Richards]

I'm against any policy that increases our national debt, trade imbalance, and spurs growth more in foreign economies (think shopping at Wal-Mart or most clothing stores) than our own.

[Dan in Pasadena]

I don't know what the hell anyone thinks giving $800 to people is going to do to seriously "stimulate" the economy? C'mon, we're dumb for electing all you clowns but we're not so stupid as to think national financial prosperity is only $800 per person away!

Okay sure, send me 8 bills and I'll like having it, but it isn't going to change a damn thing for the better and IS going to make somethings worse.

[Gogar]

And the huge hole gets deeper.

[Porsche-O-Phile]

I love how these idiots give us our own money back and expect us to bend over and kiss their asses in return for them "doing us a favor".

How about not taking it in the first place, *********s?

I'm taking mine and putting 100% of it into overseas securities. They can kiss my ass if they think I'm going to go out and spend it on stupid Chinese-made schit.

[baldman]

Some have argued that wealthier taxpayers are more likely to put a $300 check into savings or pay down debt, and that directing more of the stimulus to lower-income households that spend the money are likely to have a greater positive impact on the slowing economy.

Congressional Budget Office Director Peter Orszag, testifying before the Senate Finance Committee on Tuesday, said the 2001 experience suggests that expanding the pool of lower-income households who get the rebate this time would lead to an "appreciable" economic boost.

"For any given pot of money, the more you target the lower-income, credit-constrained households, the bigger the bang for your buck," Orszag said.

If this same guy had come out and said "poor people don't save money - they blow it as soon as they get it" the press would have crucified him. But pair it with a check and you can insult the poor as much as you want!

[the]

An xBox for everyone!

[djmcmath]

So the idea is to give money to people who are most likely to spend, rather than save? Find the gorup of people who are most likely to squander anything given to them, then give them a free paycheck? Why does this make any sense? Wow...

[VincentVega]

I thought I was the only one, I have no idea how this will help anything. The increase in debt is sickening.

[Porsche-O-Phile]

Politicians have learned that the votes of stupid people can be bought by promising them favors or rewarding their stupidity with incentives.

And a stupid person's vote is worth just as much as a smart person's vote. And it's easier to get.

Ergo, all policies are dumbed down just enough - to the point where the majority of the dolts can be captured. That's all one needs to do in order to win an election.

Same reasons you can expect a "bailout" of subprime idiots in the coming future. And of course national health care to "reward" those too unmotivated or short-sighted to prioritize covering themselves and their families.

Troubling times these are. . .

[pwd72s]

Originally Posted by Porsche-O-Phile

Politicians have learned that the votes of stupid people can be bought by promising them favors or rewarding their stupidity with incentives.

And a stupid person's vote is worth just as much as a smart person's vote. And it's easier to get.

Ergo, all policies are dumbed down just enough - to the point where the majority of the dolts can be captured. That's all one needs to do in order to win an election.

Same reasons you can expect a "bailout" of subprime idiots in the coming future. And of course national health care to "reward" those too unmotivated or short-sighted to prioritize covering themselves and their families.

Troubling times these are. . .

Or...as a man much smarter than I wrote:

“The government consists of a gang of men exactly like you and me. They have, taking one with another, no special talent for the business of government, they have only a talent for getting and holding office. Their principal device to that end is to search out groups who pant and pine for something they can’t get and promise to give it to them. Nine times out of ten, that promise is worth nothing. The tenth time it is made good by looting A to satisfy B. In other words, government is a broker in pillage, and every election is a sort of advance auction of the sale of stolen goods.”

-H.L. Mencken

[Porsche-O-Phile]

That's a great quote. And 100% correct.

[dtw]

I think the rebates should be part of a new national holiday. It should also involve other new traditions. I'm thinking of a couple...oh say, Feats of Strength and Airing of Grievances.

[Moneyguy1]

Washington and the Chicken Little syndrome.


Sad and dangerous.

[jyl]

Govt is struggling to fend off a potentially severe recession.

In a severe recession, loss of tax revenues will increase the deficit by at least as much as the $150BN stimulus.

I have no problem with deficit spending during recessions. Govt spending should be used as shock absorber in economic cycles - run deficit in recessions, run surplus in expansions.

1930s is example of govt which did not react to support the economy in a crisis, thus allowing the US to plunge into a crushing depression. Since then, govt has developed a lot more tools - Fed, Treasury, discretionary spending, social safety nets - which enable it to prevent sweeping poverty and financial system collapses when the economic downcycles hit. Recessions have become less frequent, shallower and shorter.

I have a problem with us running deficits during expansions, like we have done under current Administration. That is irresponsible.

That said, I don't think consumer tax rebates of $800 are the best way to stimulate the economy. Yes, they quickly inject money into the economy, but there is no lasting benefit, and not all of the money is spent.

I prefer injecting money into the economy through accelerated investment. Tax incentives for business capital expenditures are good. Increased federal spending on infrastructure improvements (bridges, roads, etc) are good. Tax and other incentives to develop alternative energy industry are good. These can be temporary, and will still work - businesses take advantages of temporary incentives to do capex. Further, investment benefits people who work.

Problem is, govt did not pre-plan for this downcycle, and political disagreements make it impossible for them to quickly do anything that is complicated. Bush remembers that he handed out checks in 2001, he thinks it worked, so he does it again in 2008.

Looking at how govt is responding to this downcycle, I see proactive, rapid and creative action from the Fed - may or may not work, but can't say Bernanke isn't trying. I've seen much talk but no real action from Treasury (Paulson, etc). The President has been a non-factor, no leadership at all. And Congress I wouldn't expect much from - the larger the group, the less well-suited to rapid action.

[The Gaijin]

The hippies had their draft card burning and the liberated women burned their bras - how about a mass check burning??

Time for us fiscal conservative types to stand up to the MAN! We will not be bought off with our own money and don't want anything from a govenment in debt!

"We Hate the Tax rebate!" "We hate the Tax Rebate!"

[gprsh924]

Originally Posted by dtw

I think the rebates should be part of a new national holiday. It should also involve other new traditions. I'm thinking of a couple...oh say, Feats of Strength and Airing of Grievances.

Haha

A Festivus for the resitvus

[Moneyguy1]

But the MAN in this case is a Republican!! (or is he just a RINO?)

It is all so confusing....massive debt, calls for even lower taxes, and now rebates?

[Rick Lee]

Rebates will be $300, not $800. Just a huge clusterf&ck, no matter how you cut it.

[hpservertech]

And dont forget that you will be taxed on that rebate next year too!