economic stimulus plan

[tre2000zx2]

Now I think this is a rather bad idea in the first place.... but several of my friends think its the GREATEST idea.. thinking it's gonna fix ALL our problems "keep in mind these are the same people who are gonna take THIS money and go by products made in China with oursourced tech support manufacturing and the whole nine yards" ... BUT several have asked me how they are gonna know how much they will get .."already spending money they DON'T EVEN HAVE!!!!" over half the reason MANY "NOT ALL" Americans today are in POOR finacial shape.. but... thats just my opinion...

moving on..

If you want to estimate YOUR return..
here ya go
http://www.irs.gov/app/espc/

my thought is yes savings would be better but would fail to produce even a ripple of gain in the economy but rather since it will most likely be spent on crap anyway.. why not spend it where it matters most ...LOCALY and if not localy ... at LEAST IN and ON AMERICAN products.. that is IF you can EVEN FIND THEM... any oldtimers remember in the 89's EARLY 90's Walmarts BUY AMERICAN MADE IN AMERICAN push.. what happened to that ..next time jsut try to find somthing made in america.. hell even ifn the FOOD ISLES.. look .. quite a bit says "product of Canada" wtf??


ends rant:pissed:

[JonsZX2SR]

I agree, the entire concept of the economic stimulus plan is a poor idea. People who can't manage their money in the first place and welcome money to spend without planning are the biggest supporters. No surprise there.

A much better plan would have been to grant the same number of dollars (based on population) to local municipaities to spend on local services. The money could have been used for schools, libraries, infrastructure improvement, etc. the only stipulation would have been the money had to be spent locally and no more than 20% of total money could be spent on foreign made goods. (You want to allow a little freedom for computer and A/V equipment.)

The idea is the money gets spent to benefit businesses in local communities, which pays more local salaries, which means people spend more, etc., etc. the money flows around the local economy 2 or 3 thies multiplying the effects.

Of course, it may not put money in the hands of the 'spenders' who want to blow it at big box stores and send the $$ overseas. That's the problem, the quick fix shuts up the biggest complainers and does less to help communities as a whole.

[tre2000zx2]

Good to see im not the only one who isn't all for the idea as it sits.. I think it could and should have been better thought out and applied.

[SoCalZX2]

While the plan isn't the best idea, I welcome the money because of my plan for it. My wife and I are (as estimated by turbo tax) gonna get 1200 which will pretty much all go onto my car leaving me with about 800 left to pay on the loan.

We're on a get out of debt plan, so we're steadily chunking money at debt anyways.

[Blue ZX2]

Yes I am like everyone else on here. HORRID idea.... But Im not going to be the one to say no to money!

[david gettle]

I agree that the plan as it is won't solve the problem, it's a economic "band-aid", but it's better than nothing. giving the money to local governments, while that would be an option, most likely wouldn't work well either. State and local governments can't balance their budgets any better than anyone else.

A better option may be to tax companies that outsource jobs to other countries at double the rate of companies that keep jobs here, and reduce the tax rate for private citizens.

As for the money I get from this, the majority is going to pay off debt, with a small amount going to buy things I need, but can't afford otherwise.

[Beodude123]

It definitely won't solve the problem, but you won't hear me complaining when I get my $1200 check. It's pretty much going straight into savings.

[JonsZX2SR]

...local governments can't balance their budgets any better than anyone else.

A better option may be to tax companies that outsource jobs to other countries at double the rate of companies that keep jobs here, and reduce the tax rate for private citizens.

I'm not sure where you got the idea that local gov'ts can't balance their budgets, but it is basically incorrect. Local gov't must have balanced butgets or go bancrupt because they have no way to pay their bills other than with tax revenues.

Local governments have to run balanced budgets. While they may borrow for capital projects and for unexpected events, they have to include a line item to cover the cost of debt. Their borrowing strictly limited by their ability to pay for the cost of debt. Like a private citizen or company, if they can't cover debt they risk bancrupcy. They don't have a mechanism for setting a debt limit, printing and issuing money, etc. that the federal gov't has through it's control of monetary policy.

* * * * *

Threatening to tax companies that outsource jobs may be a patriotic idea it is completely unworkable and shows a lack of understanding of international business.

Companies don't just send jobs overseas, they also create jobs in foreign markets that create goods for sale abroad as well as locally.

So how do you distinguish between a job created elsewhere, say China and one that has been simply exported ?? How do you distinguish between a job that was going to eliminated anyway, because it was not economically competitive vs. one that was simply exported for profit.

What you propose risks losing more jobs than it would save. Say the XYZ corp. wants to shift production of Z-widgets to China because manufacturing costs have risen and they also see an opportunity to see more Z-widgets in the China market. The plan is to eliminate 50 of 100 US jobs and shift production to China. The remaining 50 jobs would be shifted to sales and service with a plan to grow US employment as the less costly Chinese widgets gain market share. An increase in sales in the far east increases profits, makes ahreholders happy and in the long run increases security of US jobs down the road. In the long run the XYZ Corp. becomes a major player in the global market with increased sales and jobs both in the US and overseas.

...except that a few politicians step in and thwart XYZ's business expansion with the Gettle plan. Frustrated XYZ maintains US production with higher production costs and only starts a small operation in China. In the meantime, the Zitsui company sees a business opportunity and builds a factory in China and quickly captures most of the Asian market. With excess capacity, they see an opportunity to undercut XYZ in the US and start small sales office on the west coast.

Faced with competition from Zitsui, XYZ calls for tariffs to increase the cost of imported Z-widgets. However, consumers of widgets oppose tariffs and threated to move their production of finished goods overseas, reducing potential US exports.

A few years later Zitsui buys a failing XYZ company in order to get their factory to produce Z-widgets in the US. They lay off all but 35 of the workforce and most of the sales operation. In they end they are highly successful, wuth the profits being expatriated to their home office.

{An alternate response by the XYZ company to the Gettle Plan might have been to create separately incorporated entities and partnerships overseas. In the long run, the plan might be to sell US holdings to patriotic buyers as overseas operations became more successful, with the long term plan to eventually compete with and win the US market with overseas products.}

What we want are laws that encourage US companies to ceompete both here and globally. If we make US companies uncompetitive, we risk more than US jobs, we risk US ownership of the most competitive US companies.

The solution is to allow companies to move production where it can be done most competitively, while creating more sales, service, engineering, repair, financial jobs in the US. While this may not make the average factory worker happy, we need to look out for the US economy as a whole first, and stop making US companies less competitive with overseas counterparts.

[ImCrazy]

It won't solve anything but I'm not gonna turn down $600 bucks either.

[david gettle]

The solution is to allow companies to move production where it can be done most competitively, while creating more sales, service, engineering, repair, financial jobs in the US. While this may not make the average factory worker happy, we need to look out for the US economy as a whole first, and stop making US companies less competitive with overseas counterparts.

I conceeed you point. Since I'm in sales, consider this, retail sales jobs are some of the lowest paid jobs in existance. There are plenty of low paying jobs, that's the problem. The jobs that are available don't pay enough to live on, because the cost of living is way too high.

[JonsZX2SR]

...but the most competitive companies don't just create low paying sales jobs in the US. They create marketing, support, contract engineering, service, finance, etc. jobs in the US.

If you are selling a high tech, high profit product, there is plenty of opportunity to make more money supporting those products, finding new opportunities, etc. in all markets, including the US. To accomplish that you need workers on the ground in each market, and I'm not talking about low paying sales jobs.

The problem with forcing companies to keep uncompetitive operations here in the US is that it forces them to economize elsewhere, resulting in those low paying retail jobs. Eventually a more competitive global company eats their lunch and even those jobs go away.

As much as I dislike the Japanese car companies, they have done a better job than most of the US and European companies in the US/Canadian market and actually have created quite a few good paying jobs.

US companies need to do more of the same and create better paying jobs here in the US and elsewhere.

The problem with sales jobs is they should be viewed as an opportunity for people to develop skills and grow. Some people actually do that, moving on to marketing, management consulting, start their own business, service and service management, etc.

[mechtech]

This plan was never intended to be a fix all. Not even close.
It is just like it says, a stimulus. One thing to help in the right direction - a good thing. Since the originators of the plan didn't overstate their case, let's not overstate it either in order to tear it down, or find fault.
You don't want the money? Send it to me.

We send or money out of this country in all sorts of ways. But one often overlooked thing about China is that we generally get a great value for goods for our $s.

[younglink309]

The only thing I don't really like about the plan is that it doesn't apply to me.

I've been working for almost 2 years now, but my paresnts claim me on their taxes, so i get nothing now...

It's not too bad, since i preety much got all my taxes back by claiming zero...but still..

600 is half my car paid off...

[david gettle]

[QUOTE=JonsZX2SR;13708]If you are selling a high tech, high profit productQUOTE]

Where are you getting the misconception that high tech products are high profit?:?

I work for an electronics retailer as a store manager, believe me the highest profit items in the store are the lowest tech. That's why Wally world (I refuse to use that companie's correct name) can only beat other retailer's prices on Ipods by $0.03.

[JonsZX2SR]

Where are you getting the misconception that high tech products are high profit?:?

I work for an electronics retailer as a store manager, believe me the highest profit items in the store are the lowest tech. That's why Wally world (I refuse to use that companie's correct name) can only beat other retailer's prices on Ipods by $0.03.

Work experience, life experience... I work on high tech applications everyday. While people don't buy high tech systems for the home, we all use them in everyday life whether it is for communications, buying, information services, etc.

Where did you get the idea that high tech products are primarily retail electronics ??

Look at computer systems across all uses, business, home entertainment, gaming etc. while the margin on sales may be limited, the margins on software, support and services is significant, especially for non home applications.

Smilarly, while the profit on ipods, etc. is small, the margin of support, service, accessories, downloads, etc. is significant. (As is the profit on replacement high end razor blades where Gilette and others give the handle away.)

If you just look at job opportunities from a retail perspective the opportunities are pretty bleak... but the problem isn't with the opportunies, it is with the understanding where the oportunies lie. If the US gov't is going to stimulate growth it needs to help the service and support business grow. To do that, workers need to understand that they need to be open to new challenges.

[david gettle]

I see your point. I wasn't considering the high tech devices that aren't necessarily for personal use. (I've been working retail for 13 years now, and was a computer programmer for 16 years before that)

[Connal]

Just went to calculate it for me, I read this on the IRS site.

The advance payment will be based on your 2007 return. If you do not file a federal tax return for 2007, you will not receive the advance payment in 2008. However, if eligible, you would still be able to claim the credit on your tax return for 2008, which you would file in early 2009.

That was my biggest worry, it isn't stimulus. It is an advance return. So lets say next year you would get 650 back, you would only get 50 back. At least that is the way I am reading it.

[david gettle]

So you were under the impression that the Illegal Revenue Service was just going to give back some of the money they took out of your income, without you having to pay it back?

[Connal]

Not at all. I just don't think people understand that this is basically a tax refund in advance. Which is all well and good. Except not everyone gets back 600+

[JessicaOfVA]

Q. Will the payment I receive in 2008 reduce my 2008 refind or increase the amount I owe for 2008?

A. No, the stimulus Payment will not reduce your refund or increase the amount you owe when you file your 2008 return.

http://www.irs.gov/newsroom/article/0,,id=179181,00.html

It's down towards the bottom, under "Other Questions".

[JonsZX2SR]

Good link... I wish people would read the IRS publications on the economic stimulus package instead of arguing about things without researching them first.

The economic stimulus package is nothing more than a reduction of taxes paid for 2007 in the form of a rebate.

Since you don't take federal taxes paid as a deduction in the first place it doesn't count as income. It is just a return of all ready taxed income paid to the gov't in the form of taxes.

Since it is a return of past taxes, it doesn't increase the amount of 2008 taxable income or reduce the amount of 2008 overpayment of taxes.

I don't know why people make this so complicated.