The end of last week saw President George W. Bush announce plans for a new economic stimulus package that would seek to work with Federal Reserve Chairman Ben Bernanke to revitalize the stagnating U.S. economy. Many fear that a much harsher economic recession is on the way-fueled by recent decreases in consumer spending rates and unusually high rates of unemployment. The stimulus package, which is yet unspecified, would seek to combine legislative and executive fiscal policy controls with the Fed’s control over monetary policy in order to provide for a short-term economic boost until the effects of a lowered interest rate can take affect on the economy.
While many details of Bush’s plan have not been revealed, many agree that another series of tax refunds will be a major crux of the plan. The Miami Student editorial board believes that while a Bush and Bernanke policy combination might be a first step toward economic recovery, a system based primarily around tax refunds leaves out crucial aspects of the lower and middle class. Since those in these income brackets either pay either very little or no taxes at all, and were the most enticed by teaser-rate mortgages, the refund would provide those families with little-to-no monetary support or reason to spend more money in order to reverse the fall of consumer spending.
While cooperation between the Fed and the federal government are important, a large part of economic stimulus rests on the power of executive leadership-the singular voice from the president will be a crucial factor in helping stave off a fall back into recession. With primary season fully underway, this editorial board can agree on several aspects of economic stimulus that we would like to see discussed and implemented.
First, this board rejects the notion that making the Bush tax cuts permanent would be helpful in any way to the economy. For this reason, we do not favor Rudolph Giuliani’s, Mitt Romney’s or John McCain’s plans that revolve around the continuation of the cuts because there will be no guarantee that the right income bracket is receiving the money that they need, or a guarantee that there will be more spending. Furthermore, we support more specific plans of economic recovery-so while candidates like Barack Obama support repealing the tax cuts on certain sectors of the economy, it is a shame that they do not have a more direct plan for directly infusing the economy with aid. While this board does not know if the specific details of Hillary Clinton’s plans are the correct fix, we can agree that the amount of detail in her plan should be echoed by other candidates so that Americans know what they are be voting for.
While the election still seems far in the future, this board believes that every student at Miami should be paying close attention to stimulus plan developments. Any major economic downturns will immensely hinder job and house purchasing prospects,and this election grants us an opportunity for our voices to be heard. Students should keep updated and watching for the full plans an stimulus package to be unveiled at the end of January, and continue to be informed for Ohio’s primary election March 4.