I said at the start of Washington’s stimulus-palooza that the temporary tax rebate plan was a bad idea. The solution to the problem of too many people borrowing money and spending beyond their means–charging their credit cards up the wazoo, buying more house than they can afford, etc., etc., etc.–is not to borrow more money for a one-time rebate that encourages them to spend more to produce a short-term, feel-good boost to the economy.
Borrowers under water need more incentives to save or pay off their debts, not to splurge on golf clubs and big-screen TVs.
Fortunately, many rebate recipients are refusing to go on spending sprees:
Jack Stines of Affton expects to get a tax rebate check, but he’s not planning to buy a new television or anything fun.
“We’re going to pay our bills,” he said. “That’s really going to take care of the economy.”
His sentiments were echoed by other shoppers at Wal-Mart in Maplewood who said the money would be used to pay down debt, fill up their cars’ gasoline tanks, and buy necessities, not to splurge on purchases they really could do without.
“Mine is going right back to the IRS. It’s not going to help the economy,” said Dave Wiechens II of St. Charles.
But retailers will do what they can to pry the cash loose:
With many consumers about to receive tax rebates worth hundreds of dollars, a handful of retail chains are dangling discounts and promotions to try to get people to spend their checks in the companies’ stores.
As consumer spending slows, these retailers have hit on a marketing pitch: We’ll make your tax rebate go further.
“The trick will be to convince the consumer that the rebate check is bigger than it is,” says Pat Conroy of consulting firm Deloitte & Touche.
There’s a sucker born…
Have you gotten a rebate? What are you going to do with it?
Here’s the “IRS Stimulus Payment Status” website in case you’re wondering if you’ll be getting a check in the mail.
Ho about a little “Bills, Bills, Bills” for background music?
Can you pay my bills? Can you pay my telephone bills? Can you pay my aut-o-mo- bills…