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Economy's boost might wait a bit longer
January 28, 2008 - Steve Murch
The Associated Press is reporting today that Senate Democrats want to add $150 billion economic stimulus package rebates for senior citizens living off Social Security and an extension of unemployment benefits. A proposal that looked like it might happen relatively quickly when President Bush and House leaders put together the initial package now looks like it is headed for a long, drawn-out process.
It is understandable that someone might want to include those in the Senate Democrats’ addition, especially since Senate Democrats, including our own Sen. Debbie Stabenow, pushed the president hard on keeping Social Security intact when that was a big issue a few years ago.
Last week’s proposal by Bush and the House leaders would provide rebates to over 115 million families and it would provide $50 billion in incentives for businesses to invest in new plants and equipment.
The AP reports the Senate Finance Committee could meet by Wednesday to draft a new version of the bill.
The story states, “Adding rebates for senior citizens living solely off Social Security checks — who are ineligible under the plan hatched by House leaders and the White House — would likely mean doling out smaller rebates overall, shrinking the size of the payments from $600 to $500, according to aides familiar with the emerging proposal.”
The original plan, when first discussed by Bush prior to meeting with House leaders, was to help stimulate the economy. The president hoped people would spend their money, hence helping the economy. Experts were say it might be the first of May when people could look forward to the checks. It now looks like it might take a while longer, especially if we have a showdown.
It’s doubtful those on Social Security would spend their portion frivolously, which in essence is what this stimulus package is hoping. No one wants to say it that way, but to give a real boost to the economy people would have to spend some of the rebates on things like flat screen televisions, down payments on a new automobile, etc.
Though our online poll is unscientific, a look at the Monday afternoon figures shows most people wouldn’t be giving the economy a direct boost. Of the three choices, paying off debt is what most of the people say they will do (49 percent), with 35 percent saying they will spend it and 16 percent say they will invest. That means 65 percent of the people say they won’t spend it.
So much for that boost to the economy. Of course, if something jumps starts the economy before the rebates come, then people might spend on things a bit more frivolous.
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