Congress has passed an economic stimulus package to try and keep us out of a recession. We are all supposed to get a check in the mail for ourselves, spouse and kids. The stimulus will cost our country $168 billion dollars.
Each of us with an income less than $75,000 but over $3000 will get a rebate check of $600. Double that for a couple. Each child is worth an additional $300 dollars. We should be seeing our windfall by June.
The trouble is that we are only forestalling what is to come. Many Americans have borrowed themselves into debt and are living in peril of their house of cards collapsing.
The rebate check would certainly help many get caught up. But believe it or not that is the worst thing you could do with your check according to our government. They need you to spend it on I-pods, washers, TV's and such.
It doesn't matter if it would be in your best interest to pay down your debt or put money in a savings account for a rainy day. No, that won't help our economy one little bit.
Last Sunday there were two articles in a paper I was reading. The first was about how the economy was in trouble because people not paying off their debts and living too far in the hole. Their solution was for people to pay off what they owe as quickly as they can, as fast as possible.
And the second article that was right underneath the first was about our government's fear that people might use their money to pay off their debts rather than spend it.
Talk about mixed messages.
Of course, for us all to get this money the government is putting us, as a country, further in debt. Yep, they are borrowing the money to get us to spend. This little gift will add to what the country owes and give us a $250,000 billion deficit. Seems like just a few short years and two wars ago we were sitting on a budget surplus.
Sooner or later our country is going to have to feel the pain that comes along with an economic adjustment. Artificially stalling the inevitable is just a quick fix to keep us going through the next election. We all need to hold on because it is going to be a bumpy ride for the next little while.
Most economist are saying there is no quick fix for our economic woes. A new president, Democrat or Republican, woman or man, will not alter the course of some of the things that have to happen to get us back on course.
Our country has weathered recessions and even depressions. We will stand tall and get through this as well.
My advice to you when you get your check, do what feels right for your financial situation. Spend if you want to, but pay off things if that is best for you.
And despite what anyone might say, you can never go wrong putting money away for a rainy day. The dark clouds on the economic horizon say there is at least a 50 percent chance of rain in our future.