Monday, March 17, 2008

IRS: Economic Stimulus Payment

Today I received a notice from the IRS about the Economic Stimulus Payment I'll be receiving since I'm a taxpayer. Now let me tell you why this didn't make me jump for joy.
1. Why did they send out a notice before the checks were cut? It's wasteful to do a double mailing, and contrary to what some think, this isn't "government" money they're wasting. It's YOURS and MINE. We paid the taxes in the first place so the government could waste a good portion of it on senseless mailings such as this one.
2. While I'll never turn down a tax rebate, the whole idea is rather repulsive. What the government is really doing is playing socialist and redistributing wealth. I don't think the government should have the power to do that. It's contradictory to the principles of a free society and free market system. I'm not against helping people in need, in fact, I'm for it, but it's not in the federal government's job description to play Robin Hood. The private sector could do a much better job at helping those in need. The entire tax structure in this country needs to be overhauled. Tweaking it with tax hikes and tax cuts is not enough.
3. This "stimulus payment" is supposed to help dig the economy out of a recession, but again, the IRS and government bureaucrats (and unfortunately elected officials, too) don't understand a basic concept in economics. Most people won't run out and spend this "payment" on goods and services - at least not all of it, which is what would be necessary to "stimulate" the economy. In order for people to change their consumption habits, a permanent change in income is necessary. A one-time payment such as this will most likely be used to pay off some debt, or be put into savings.
4. What's especially irritating is that the supposed "rich" people ($75,000 AGI) will get a "reduced" payment or the payment might even be "phased out completely." Now, if that's not unjust, I don't know what is. It's the people in the higher tax bracket who PAID the higher taxes in the first place, and now, when it's time for a "stimulus payment" they get left out? Folks, this is blatantly socialistic.
5. If we're going to redistribute wealth, why bother paying taxes in the first place? Why not just have all of our wages and salaries sent directly to the government and we can all live on a check from the government each month so that everybody gets an equal share? If that were the case, in a very short time, our economy would collapse because there would be no incentive to produce. We're all going to get an equal check no matter if we work hard or sit at home and watch television. Incentive is all about a return. If the end result is the same, why work a lot when you can work a little, or not at all?
So, as you can see, I’m not at all thrilled. The “generosity” of the government in returning some of what I paid them fails to captivate my gratitude. There are better ways to stimulate the economy.