Take these three articles and tell me what you think:
Tentative Deal on Economic Stimulus Plan - New York Times (today)
Make the Tax Cuts Work (yesterday)
How to Stop the Downturn (yesterday)
(The guys over at Lawyers, Guns & Money have a little post here, too, that I liked.)
From the first article we find out that a compromise has been reached to give ordinary folks like you and me a $300 check - a rebate, I guess. But to get that check, a couple of concessions had to be made (and this is where my confusion comes in):
A House aide close to the negotiations said that Speaker Nancy Pelosi of California and the Republican leader, Representative John A. Boehner of Ohio, reached an “agreement in principle” after Ms. Pelosi agreed not to include two proposals that had broad support among Congressional Democrats: an extension of unemployment benefits and a temporary increase in food stamps.
In the op-eds from yesterday it's pretty clear to the economists that aid to the lower- and middle-income strata would help out the most. (The Times has a nifty summary of why this could be here.) One of them even mentions how expanding unemployment could help. But while a $300 check is ok, how much of a financial bulwark is it against a scaled back food stamp program and no extension of unemployment benefits?
I mean, let's say you've spent the $300 - to pay rent, pay off a credit card bill, buy some groceries or buy some gas, whatever. Now what? You're still on insufficient food stamps or you're still unemployed and your benefits are about to run out (or you didn't qualify for it in the first place.)
Since I'm not a theory head when it comes to economics or business, what's the long view of this issue?
I mean, is a $300 rebate check really the best that can be done? (I'm assuming, too, that if one qualifies for a federal and state EITC, then one would receive those checks, too, so maybe we're talking about more than $300 for a family?)
And what did you do with the last rebate check in 2001?
Shit, I don't even remember getting one.