In a classic case of too little, too late, the administration and Congress have reached a deal on a stimulus package.
Congressional leaders completed a deal Thursday with the White House on an economic stimulus package that would give most tax filers refunds of $600 to $1,200, and more if they have children.
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Individuals who pay income taxes would get up to $600, working couples $1,200 and those couples with children an additional $300 per child under the agreement. Workers who make at least $3,000 but don’t pay taxes would get $300 rebates.
The rebate part of the plan would cost about $100 billion, aides said. The package also includes close to $50 billion in business tax cuts.
The package would allow businesses to immediately write off 50 percent of purchases of plants and other capital equipment and permit small businesses to write off additional purchases of equipment. A Republican-written provision to allow businesses suffering losses now to reclaim taxes previously paid was dropped. Pelosi, D-Calif., agreed to drop increases in food stamp and unemployment benefits during a Wednesday meeting in exchange for gaining rebates of at least $300 for almost everyone earning a paycheck, including low-income earners who make too little to pay income taxes.
One hesitates to call such a thing a “rebate,” given that the term implies giving a portion of something back, but it likely makes sense if one’s goal is to pretend to stimulate the economy.
Given that the government collects money via a system of withholding, one wonders why waiting until June to send out checks — or even sending out checks at all — is necessary. Couldn’t they just let people keep more of their money in February?
UPDATE: John Aravosis critiques the plan — from the left, no less — by noting that it screws over the rich and middle class, including those of us who live in major metropolitan areas where the ceiling of $75,000 isn’t that much money. Of course, the Democrats have been complaining about tax cuts going mostly to the rich — i.e., those who pay taxes — for decades, so this outcome shouldn’t be particularly surprising.
