It looks like whoever gets elected in the upcoming election will issue some sort of stimulus package early next year. I am not a big fan of stimulus packages for long term results in getting an economy going. For the short term, it provides a shot of cash into the economy and consumers can get a little spending money.
Unfortunately, in today’s economy, it isn’t enough cash to make a great change. The numbers show that a lot of people use the money to pay off bills. That in of itself is a good thing but that doesn’t generate anything new into the economy. It does keep some firms afloat for a little bit longer and hopefully it also keeps some people in their homes or apartments a little longer too.
We need to introduce long term infrastructure repairs to get the economy going. It will take about 4-8 years to get back on our feet collectively as a country. During that time we need to get cash in the hands of people, true, but we need to do it in a long term and more meaningful way.
For the short run, the stimulus checks are also a very small amount of money compared to the amount of cash being poured into the corporate bailouts. Hopefully, with some ownership and accountability in the firms that the US is helping (or proposing to help), we can get a revenue stream from that.
I am unclear how political pundits can say that everything will be okay by Spring 2009 with the mechanisms that are already in motion. My take on this is that they are wishful thinkers and are just trying to get people in a positive state of mind.
I am more of a realist. If somebody is telling me that there will be a flood and they built in ark and I am already standing in two feet of water I would get the hint that there might be something to what he is saying. People like to hear things that reinforce their own opinions and right now, a lot of people are thinking and praying that things will get better quickly. It will happen, just not quickly so we all need to make do and try to survive as best as we can until things recover.
Saving money would be a great start for everybody.
It would be nice if everybody who gets a stimulus check could save 10% of what they get but the reality is that people who are getting the money need every dime and penny of it to pay for bills and stay afloat.
In the meantime, don’t be surprised if like last year there is mad scrambling to redo tax forms or patch them with special letters like in some previous years. I have a feeling that more stimulus checks will be on their way.
Oh, I almost forgot – if you are curious as to how much we might be getting, take a look at both candidates platforms and do a search on Google for stimulus checks. You will see all sorts of interesting numbers and percentages.
Kim Greenblatt
You are reading Kim Greenblatt’s blog about stimulus checks.
Tags: Business, stimulus checks
[...] already talked about the fact that we will probably be looking at another stimulus package come early next year. I have heard from different news sources that waiting in the wings will be [...]