by Frank James
Washington is a go-along to get-along kind of place if ever one existed. And one of the latest ideas of the go-along variety was the fiscal stimulus package to mail rebate checks to most American households in an effort to jump start consumer spending and prod the economy out of its doldrums.
But not everyone wants to go along with the program on this one. For instance, Bruce Bartlett, a domestic policy adviser for President Ronald Reagan and Treasury official in President George H. W. Bush's, is proposing that Congress and President Bush scrap the idea of sending out the checks
In an op-ed piece in today's New York Times, Bartlett argues that the $117 billion would be better spent, say on a program to bail out the mortgages of millions of people facing foreclosure on their homes this year.
We need to stop and ask whether we can afford to spend $117 billion that the Treasury Department does not have on a program of dubious effectiveness. It simply makes no sense to send out checks to people who have no need for it as some kind of election-year bribe to vote for incumbents of both parties. That money would go a long way toward cleaning up the mortgages that are poisoning the financial sector.
Congress should immediately repeal the rebate and redirect the money that has been budgeted into a package of measures that would help the housing sector and those people who actually need assistance. The Treasury might use some of the money, for example, to enable Fannie Mae and Freddie Mac, the government-sponsored housing agencies, to buy up some of the bad mortgages, get them off bank balance sheets and help homeowners refinance them.
How likely is Congress to just change its collective mind on the stimulus package?
Here's where we cue the sound of crickets.
Why would Congress want to bail out on the checks idea? It has received excellent political cover.
Despite what Bartlett says in his piece about "few economists" supporting the idea, no less than Federal Reserve Chairman Ben Bernanke told lawmakers that a stimulus that included rebate checks could prove beneficial so long as Congress acted quickly.
So Congress did act quickly.
It's not that what Bartlett proposes doesn't make sense. There are proposals on Capitol Hill right now to create a rescue fund for millions of mortgages.
But he can forget the idea of Congress reversing course on the stimulus checks. Both Democrats and Republicans have boasted to voters that the checks are on the way. So has the president.
To stop the checks, lawmakers in Washington would have to have faith that voters wouldn't hold such a turnabout against them. Even after Easter, such faith seems far-fetched.
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Comments
What an idiot. Nothing (including the 'stimulus' package is going to jump start consumer spending. Face it: we're broke. The gov't is broke. We're living on debt. Housing prices MUST come down before this problem can be resolved. Until we reach equilibrium between home prices and wages, home prices will continue to fall.
Posted by: weinerdog43 | March 24, 2008 12:01 PM
Bartlett's correct, this so-called stimulus package is a farce that will do more harm than good. Doesn't anyone remember 1993 and what the Democrats did to turn the Republican economy around?? Yes it cost them their majority in congress, but it helped the country. Let's do it again: raise taxes on the rich, pay down debt, balance the budget. Not complicated.
Posted by: Paul | March 24, 2008 12:21 PM
They should send an IOU to the future generations in the amount of each person's portion of the national debt out along with the "stimulus" checks.
Posted by: Nick | March 24, 2008 12:51 PM
If the tax cuts were equitable in the first place, we wouldn't need a stimulus package.
Posted by: Grandblvd03 | March 24, 2008 2:26 PM
Fact is the economy is doing quite well. Sure we have a temporary rough patch but it is greatly brought on and exaggerated by the Hate America Left. The Lefty Loons will not rest until every major American city is a pile of black, smoldering rubble and every corporation is run out of the country. Lefty Loons, truly the worst mankind will ever know. Worse than the plague.
Posted by: Anonymous D | March 24, 2008 4:16 PM
I sure hope Anonymous D was being intentionally ironic. Leftists are arguably twice as patriotic as righties, simply because we are able to acknowledge the problems with our system. We don't pretend to be the "righteous" among the "animals."
Instead of pretending everything is ok as the sheepdogs (GOP) are leading you, try opening your eyes and looking at one simple balance of trade sheet or a recent US budget. If you have any idea what a number is, you will be shocked.
Posted by: Kyle Smith | March 24, 2008 5:21 PM
Sick economy + people wanting to help sick economy (lefty loons) = black smoldering rubble.
You, sir, have blown my mind.
Posted by: David | March 24, 2008 6:55 PM
Anonymous D is obviously none other than John Dyslin of Streamwood Illinois, using his sick, twisted, tortured imagination to spew his hate and venom against anything that threatens his cozy little comfort zone. He believes that everything republitard is right, and anything that might question that assumption is the result of hatred against his own personal bubble. DOn't get too offended by his luntaic rants. The economy is a wreck. Even vice president bush has admitted it. Little jonny, please don't scare the tourists here. They don't know you take your orders from KKarl, and if they leave, there will only be you and your negative infinity IQ to keep un entertained.
Posted by: rncbs | March 24, 2008 6:56 PM
Why should the tax payers take over the bad debt of a foolish banker, then reward a foolish borrower with favorable terms?
In real life a majority of indebted recievers will skip additional purchases to pay down their debt. This will help responsible lenders and borrowers without complex and time wasting effort. All in all it's not the worst plan considering that international interests helped drive the frenzy. were
Posted by: whatnow | March 24, 2008 6:57 PM
Paul - obviously you don't remember 1993 - the economy was 18 months out of the recession - that's right Bill Clinton inherited a recovering economy. His tax increases raised taxes on who??? Try seniors as he started taxing soc security payments. Try everyone that filled a gas tank.
Bill Clinton ought to be damned happy he had his pants down in the oval office while the internet/personal computer revolution was taking place. That and the GOP taking over Congress - best political thing to happen to the Dope from Hope.
Grand - you are right. If the income tax cuts were in proportion to how the taxes are paid, then they would be fair and the economy would really be humming.
Posted by: Terry | March 24, 2008 8:09 PM
Bush is going to wave the governments credit card in the air and send out money we don't have. Also to spend this money to greedy people that bought houses they couldn't afford, and greedy lenders that borrowed money to people with no down payment and pay only interest for five years deserve what the get. If the we the people are going to bail them out wait until everyone gets one of these greedy loans so everyone can get bailed out together. It's a good thing they didn't make our government small enough to drown in a bathtub. We wouldn't have been able to bail out wall street. whiteagle38
Posted by: whiteagle38 | March 24, 2008 11:05 PM