Now that the effects of the first economic stimulus package are wearing off and consumer spending is dropping like an anvil, taking America’s economic prospects with it, how long will it be before we see the next brilliant economic stimulus package? The government seems intent on avoiding a recession at all costs, so it seems almost inevitable that a second stimulus package will be unleashed, especially if Obama takes office.
Democrats in House are pushing for more economic aid to be sent out, but in this version they want to see money sent to local governments along with infrastructure improvements and assistance to certain families and workers in need, according to the Economist. Their proposal totals around $50 billion. So far President Bush seems intent to avoid another stimulus package, but who knows if he will change his mind or not. In all likelihood, though, nothing would happen until early next year, under the new President’s leadership. Since Obama has been pushing for a second stimulus package, it seems that if he is elected we can pretty much expect to see one next year, unless the economy makes a miraculous recovery in the second half of 2008 (not likely). McCain, on the other hand, seems opposed to one for the most part, but with Democrats expected to rule in both chambers, according to the Economist, he might be easily swayed if elected.
If I had to guess, I would say chances are more likely than not that we will see another stimulus package. The question that always comes up in my mind though is, “Who’s going to pay for it?” It seems rather silly to tax people in order to give them money back via an economic stimulus, which means we are going to rack up some more IOUs. What’s another $50 billion when you are already $9.9 trillion in the hole, right?