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Stupid Rebates in “Stimulus” Plan Discourage Work, Economic Activity

Started by cordblomquist · 2 months ago

Under the “stimulus” plan proposed by House leaders and the White House, you get a “rebate” — even if you work so little that you pay no taxes — but not if you work so much that your income exceeds a certain level. That ... Continue reading »

6 comments

  • rawdawgbuffalo

    10 months ago

    All of this is just a short term fix. And truth be told, it has been happening over past 3 decades. Reagan and Clinton have just as much blame as the current administration. This is an interesting perspective on this(the midas touch)
    reply
  • HansBader

    10 months ago

    Note that the rebates will only discourage work (as opposed to punishing past work) if they are sent out in 2009, not just in 2008.

    If they are just mailed out this year (2008), based on income earned in the preceding year (2007), it won't have much of an effect on work, because people can't change how much they worked in the past, or how much they earned in the past.

    There's no guarantee that any recession will last into 2009, or that refunds will be sent out in 2009 as well, and I should have acknowledged that in my post.

    The uncertainty about whether the refunds will be renewed reduces the disincentive effect.
    reply
  • Marwan Nusair

    10 months ago

    Apart from incentives and disincentives, isn't this a bit like pumping water from one part of the ocean and dumping it in another, in an attempt to raise the water level? The rebates presumeably come from the same economy to which they will now go. I assume the main impact is psychological, which is probably as crucial as any other (real) factor.
    reply
  • Gerry Shuller

    10 months ago

    Stupid (Congress) is as stupid (Congress) does.
    reply
  • mike brown

    8 months ago

    This economic stimulus package is just a mere coverup
    meant to draw your attention away from the economic downfall this country is heading for.The guidelines are
    a crock of rubbish that encourages people of higher incomes to make less money. And only allows for people
    to get credit 2 kids when there is alot of families with more than 4 people,but i guess the kids dont matter.
    For people that dont recieve public assistance, that
    work hard for their family with more than 2 children this
    package is pretty much telling them the other children
    dont matter. I am not rich. I dont even make 25,000 thousand a year and take care of 5 children without public assistance. I believe this plant to be biased
    against "well to do" folks". What should be good for
    one should be good for others.
    reply
  • Not Gonna Work Any More

    7 months ago

    I'm happy I read this thoughtful post. I'm going to stop working when my income reaches $150000. I really don't want the other $24000 I anticipate earning so I can get that check for $600. But isn't it a mute point since the rebate is based on my last years income. What a dirty trick, I've already harmed my huge rebate check. I'm no fool
    reply

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