Tax Rebates of 2008

Stimulating the Economy?

In recent months, it has been impossible to watch any news program and not hear about bailout plans for the banks on Wall Street or the auto companies, recent job cuts, the latest unemployment numbers, and the stock market, which is in a tailspin. Anybody could tell you that something needs to be done to revitalize the infrastructure in America, or we are going to have many tough years ahead, but what needs to be done? Is the solution as simple as another stimulus package to put added money in the hands of Americans, or do we need to move beyond a simple stimulus package and fix the energy policy?

In February 2008, President Bush signed into law the Economic Stimulus Act of 2008. The Economic Stimulus Act provided tax rebates to low and middle-income U.S. taxpayers, tax incentives to stimulate business investment, and an increase in the limits imposed on mortgages eligible for purchase by government-sponsored enterprises (i.e. Fannie Mae and Freddie Mac). This Act provided U.S. taxpayers up to $1200 and businesses incentives such as 50% of the cost of specific investments in 2008. The Economic Stimulus Act of 2008 was quickly signed into law because economic indicators were indicating the threat of a recession, therefore the government needed to act swiftly to stimulate the economy through government spending and tax incentives. How well did the stimulus package work if less than four months down the road if major banks have crumbled, unemployment rates are up, everyday there is more news of job layoffs, and the stock market is down? It appears that we simply put a band-aid on a gushing wound.

Some may suggest that the government and President-elect Obama simply sign another stimulus package into law, and that would solve the economic problems for a short while again. President-elect Obama has devised a $75 billion dollar stimulus package that would provide relief to those people who need it most in the form of tax cuts and..