During the presidential election, Barack Obama spoke about proposing an economic stimulus plan for 2009. Originally, Obama and Congress wanted to get a stimulus plan passed during his lame duck period, but Congress is no longer in session until the beginning of the new year, so it looks like that isn’t happening. The Democrats wanted to get two stimulus packages passed, one by the end of this year, and then another one in the beginning of 2009. Now, it looks like they will push for one comprehensive stimulus plan in January or February of 2009.
When Did Democrats Start Talking About A Stimulus Plan?
Last summer, Obama saw high gas and energy prices, and he and his staff devised a plan to stimulate the economy. Part of his stimulus plan would have given up to $1,000 per family as an energy tax credit to offset the high gas prices families were paying. He planned to pay for the stimulus plan by implementing a windfall profits tax against oil companies. Now that gas prices are at about a $1.75 per gallon on a national average, I assume that he will revise the name of the tax credit and where he gets the money from.
Here are some more proposals Obama has made while on the campaign trail:
- Suspending penalties and income tax on early withdrawals from IRA and 401(k) accounts.
- Offering a temporary tax credit of $3,000 to companies for each new full-time employee hired in the United States.
- Extending unemployment benefits by a period of 13 weeks and temporarily suspending income taxes on those benefits.
- Requiring a 90-day moratorium on foreclosures for homeowners.
The most likely economic stimulus plan that Obama will try to pass as the new president is called a “make work pay” tax credit that will give $500 per person or $1,000 per family, which will provide a partial tax credit from social security tax. The second proposal which could be part of one big plan would be an extension of the earned income. This would provide more tax relief to lower income workers.
Do we need another economic stimulus plan?
I really don’t know how the government thinks that handing out all of this money is going to get us back to a good position. It’s the most backwards thinking I have ever seen. They’ve already pumped in $150 Billion this summer, $700 billion to financial institutions, probably another $15 billion to auto makers, and now more billions of dollars in the beginning of the year. If you want to stimulate the economy, let free markets run the course. The government has meddled so much in the free market that after it’s all said and done, it won’t be a free market. The government will have a stake in every private industry, because every private industry wants a handout. We don’t need handouts, we need education and personal growth. Going through tough times builds character and teaches us lessons. The only way for this economy to flourish again is for individuals to take control of their finances by eliminating unsecured debt, saving for emergencies, and increasing their income. The government will not bail us out of an economic crisis. Only we will bail ourselves out of an economic crisis.