Last week I wrote about the possibility of another stimulus check. Since I wrote about it, I’ve gone back and done some more research. Obama’s campaign is calling it an “emergency economic plan” designed to help people in the US combat rising energy costs. This is a two part economic stimulus plan that calls for taxing large oil companies to redistribute the money to individual tax payers.
Two part Emergency Economic Stimulus Plan
The first part of the emergency economic stimulus plan is a $50 billion emergency energy rebate which would give permanent tax breaks of $500 to individual workers and $1,000 to families. This could happen as soon as this fall. According to Obama, “This rebate will be enough to offset the increased cost of gas for a working family over the next four months. Or, if you live in a state where it gets very cold in the winter, it will be enough to cover the entire increase in your heating bills. Or you could use the rebate for any of your other bills or even to pay down debt.”
This is the first part of Barrack Obama’s Emergency Economic Plan:
1. Forcing big oil companies to take a reasonable share of their record breaking windfall profits and use it to help struggling families with direct relief worth $500 for an individual and $1,000 for a married couple. The relief would be delivered as quickly as possible to help families cope with the rising price of gasoline, food and other necessities. The rebates would be fully paid for with five years of a windfall profits tax on record oil company profits. This relief would be a down payment on Obama’s long-term plan to provide middle-class families with at least $1000 per year in permanent tax relief.
The second part of the plan calls for a $50 billion stimulus that, according to Obama’s campaign, would save more than a million jobs. The money from this part of the stimulus would be split among state and national government agencies and would go toward rebuilding roads, repairing bridges, and repairing schools.
This is the second part of Barrack Obama’s Emergency Economic Plan.
2. $50 billion in immediate measures to turn our economy around and help prevent more than 1 million Americans from losing their jobs:
- $25 billion in a State Growth Fund to prevent state and local cuts in health, education and housing assistance or counterproductive increases in property taxes, tolls or fees. The fund will also ensure sufficient funding for home heating and weatherization assistance as we move into the fall and winter months.
- $25 billion in a Jobs and Growth Fund to replenish the highway trust fund; prevent cutbacks in road and bridge maintenance and fund new, fast-tracked projects to repair schools – all to save more than 1 million jobs in danger of being cut.
How will the US Government pay for another round of stimulus checks?
By raising taxes. Obama’s plan calls for placing a windfall tax on oil companies to pay for the emergency economic stimulus plan checks sent to taxpayers. Obama’s plan calls for the stimulus checks to be paid for with 5 years of windfall taxes, but he also calls for the individual tax breaks to be permanent.
How will the US Government pay for the combined $50 billion for the State Growth Fund and the Jobs and Growth Fund? There was no answer. Actually, the purpose of the State Growth Fund is to give the states more revenue without forcing the states to raise taxes. Raising national taxes must be a clever way around that.
Something doesn’t add up. The $50 billion emergency economic stimulus plan for individual tax payers will take 5 years to pay off using windfall taxes on oil companies, but the tax breaks are also supposedly permanent tax breaks. The money for the State Growth Fund and the Jobs and Growth Fund is as of yet unaccounted for. The paper didn’t specify if these are to be permanent as well.
Do we really need another round of stimulus checks?
What is the Obama campaign trying to accomplish? Obama’s written policy states that he wants to tax oil companies for 5 years to pay for 4 months of relief for American tax payers. That doesn’t seem like an efficient use of resources to me.
The State Growth Fund and the Jobs and Growth Fund both have more appeal to me. The goal of each of those funds is to create something. Create jobs, create roads, create opportunity. And that is what America is about – opportunity.
If you are going to go for broke, then go for broke while trying to create something. Not while trying to buy votes.
Reader Poll – should the US Government sponsor another economic stimulus check?
This article was published in conjunction with a reader poll. The poll is now closed and the results are published below:
Poll: Will Another Stimulus Check Help the US Economy?
- It’s just what the doctor ordered. (56%, 1,655 Votes)
- I don’t care just show me the money!!! (20%, 598 Votes)
- It won’t make much difference, but we should do it anyway. (15%, 432 Votes)
- It won’t make much difference, and it’s a bad idea. (9%, 262 Votes)