What happened
Democrats and Republicans in Washington reached a tentative agreement Thursday on a plan to sent out tax rebates of $300 to $1,200 per family to boost the sagging economy. Businesses would also get tax breaks. (Time.com)
What the commentators said
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Boy, this is “something new and strange” for Washington, said Reid Wilson in RealClearPolitics. “Both parties are actually working together.” In fact, leaders on both sides of the aisle are so eager “to pass a sweeping stimulus package that puts money back into consumers' (read: voters') pockets,” the only thing they’re fighting over is who can look more cooperative.
From the sound of it, said Paul Krugman in his New York Times blog, this bipartisan rush job won’t provide much of a stimulus at all. The way to boost spending is to get most of the relief into the hands of “those who need it most, and are most likely to spend it.” But “the measures that would do that—benefits to the unemployed, food stamps," etc.—are being bargained away” by a Bush administration reluctant to help those in need, and Democrats unwilling to fight for them.
Throwing money at consumers is “futile,” said Donald J. Boudreaux in The Christian Science Monitor. “Government cannot create genuine spending power; the most it can do is to transfer it from Smith to Jones.” The best thing for everybody would be action that truly helps the country’s “economic fundamentals,” such as permanent tax cuts and reductions in government spending.
Even if Congress and President Bush meet the goal of approving a stimulus package by March, said Sarah Lueck in The Wall Street Journal, the checks might not be in the mail until June. The IRS computers that will divvy up the money won’t be able to focus on the job until tax season is over.
