2009 Two Beer Stimulus Package

Guest blogging provided today by Neal Braver of Brockton, MA:

In 2008, many of us got a check from Uncle Sam as part of the Bush administration's 2008 stimulus package: A check for about $800 per person. But that was before Obama saw beer as a political device.

The nice thing about an $800 check is it can be spent on things relatively expensive: Pay large bills or buy a new dishwasher or refrigerator. Things had to be built, parts had to be made, sales people had to sell: It broadly impacted the economy.

But it did have one drawback: Checks had to be mailed by the government and money had to be there to support the checks. Overall, this costs the Fed (and taxpayers) many millions of dollars.

But fast forward to the Obama administration's 2009 Making Work Pay Credit. This euphemism implies that, rather than having to print checks and money, the Fed just decreased withholding and let people take home more from their paycheck: Lower the bridge rather than raise the river (or is it raise the river rather than lower the bridge?).

Think about it: You collect 10-15 dollars a week extra and the only role for the government is to keep track of who got how much, and this can be comfortably factored into everyone's income taxes: It gets factored into your tax debt. No printing, no mailing, no cash, Save millions (actually they did have to print checks for a few select demographics).

But Is It Enough For More Than Two Beers?
But the issue I have is: Does $10 to $15 week contribute to the economy? It's generally not being spent on big ticket items, and most people can go through that money in one or two lunches.

Clients often ask me how much more they should have seen in their checks and I answer with the best conceptual model I can think of that's in line with the Obama administration's conflict resolution method:

" Two beers worth."

Well three, if you drink Budweiser.

Our Proposal:
Thus, I am proposing that the Obama administration rename the 2009 Making Work Pay Credit the Two Beer Stimulus Package.

Get your paycheck, hit the pub, raise your glasses and party down! At least the breweries, the pubs, and--let us not forget--the bartenders will be happy. And always take good care of the bartenders.

Disclaimer: Every effort has been taken to provide the most accurate and honest analysis of the tax information provided in this blog. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.

Posted To: Tax Rants by David Rocci By: David Rocci On: Friday, December 11, 2009
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