I am not suggesting that this tax break is all there is to Obama's plan. It is not. However, I would like to ask what I think is an important question about the part of the plan that involves stimulating the economy by essentially putting an additional $500-$1,000 in the hand of every American family - Do we have any reason to believe that this will help?
Common sense would suggest that it might work. If each family receives extra money, they may spend it. Such spending might in term provide the economy with a useful boost. But isn't this really an empirical question? Instead of guessing about what might work, might we consider whether there are any data which would tell us about the likelihood of it helping?
What did you do with the $500 you received from Bush last year as part of his economic stimulus package? Did you immediately dump it into the economy? I put mine in the bank. My tax burden was surprisingly heavy last year, and I did not feel like I had any extra money to spend after writing that check. How many Americans will do something similar with Obama's rebate?
Whatever happened to making policy decisions based on data? I'll admit that I know little about economics, but I'm curious about why nobody is discussing what relevant data say about the likelihood of such an economic stimulus plan working. Is it because we don't have any or because the media figures we are too stupid or self-absorbed to care?
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