Let's take a look at the numbers...
-$49.1 billion goes to elementary/secondary schools
-another $79 billion is going to the Department of Education through the State Fiscal Stabilization Fund
-$46 billion goes directly to unemployment insurance, with another $27 billion in extended "emergency" unemployment funding. Translation: more money for unemployment insurance and more time you can stay on it.
-$60 billion for transportation works
-$87 billion goes to Medicaid
-$49 billion for energy programs
-$20 billion for health care information technology
-many more billions for college loan programs
-$190 billion in tax cuts
you all can read the bill here:
http://www.cbo.gov/ftpdocs/99xx/doc9968/hr1.pdf
One of the most interesting provisions is the business tax cut: $90 billion (expected) for the first year in immediate write offs. But, here's the weird part.... unprofitable firms can gain access to income taxes they've already paid in previous years. I support the idea of tax cuts for businesses. However, paying money out to unprofitable firms seems like it may be a waste of taxpayer money. It is the companies' previously paid money though. I'm a little conflicted as to how to feel on that.
In my opinion... there is way too much money being pumped into welfare and entitlements and not enough into business tax cuts. When you compare how much of the money is going into government programs to how much is going back to the businesses or individuals... it's kind of astounding. I look forward to see how this will do in the Senate (it will pass, I'm almost sure). I don't know what I was expecting but this is a little bit more of the aggressive, opportunistic expansion of government than I was expecting.
I, however, really do like the large, accross the board investment being made in human capital. I really hope there is a more specific plan than just "throw money at it". But I think that it's a great step to improving our schools and making sure underprivileged students can still go to college even in these trying economic times. I think it's a great move there (though I'll be on the look out for how they're gonna use the money).
So.... good news, bad news. Definitely not what I wanted. But, there are some spots of sunshine.
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I agree with your thoughts here Chris, especially when you mention how "there is way too much money being pumped into welfare and entitlements and not enough into business tax cuts". Why is the government trying to mend the byproduct of damaged businesses (unemployment) instead of simply pumping money into the source (the businesses)?
ReplyDeleteYeah it seems to me like they're trying to deal with the symptoms and not the causes. It's a really political move and I don't quite like it. It will mean that we'll see probably a big jump in short run GDP and also a drop in unemployment due to the number of people in these new government jobs. But, in terms of investing for the future... I'm not so convinced that this plan is what we need.
ReplyDeleteAgain, I agree wholeheartedly.
ReplyDelete