What a way to buy votes.With the threat of a recession looming in the near future, President Bush and Congress agreed to an economic stimulus package of "tax rebates" for lower to middle class households.
People eligible would get anywhere from $300-$1200 in the hope that they will spend the money and restore the lost momentum in the U.S. economy.
The $150 billion package would also give businesses $50 billion in tax incentives.
The normally super-slow federal government displayed tremendous speed in developing this package, which proves that when it comes to buying votes, both parties can spend recklessly and without regard for sound economic principles.
Many of the recipients do not pay taxes, so to call it a "tax rebate" is foolish. It is really a welfare check.
No word yet on where the money for this package comes from.
It would have been better to just tell everyone that does pay taxes to deduct the allotted rebate from their next payment to the IRS, but that wouldn't buy as many votes for either party.
Better yet, the best way to stimulate the economy would be to pass H.R. 25, also known as the FairTax. The FairTax would unleash the economic power of individuals, small businesses, and large corporations.
With the FairTax, every person with a job or business pays no income tax, so they get a full paycheck instead of having deductions taken from their pay and sent to the government agencies like the IRS and Social Security Administration.
The income tax is then replaced with a national sales tax of about 23%, which replaces the embedded taxes that are found in every product or service.
The result is that the prices of products and services remains virtually unchanged while reducing the size of government, getting the IRS out of our lives, and giving the poorest of Americans a real economic boost.
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