What is this thing about george bush giving money to the people in america to raise the economy?

Question

Can I have some details on how this works?

Answer 1

Some economists believe that tax cuts, in this case in the form of a tax rebate, help stimulate the economy by giving people more money to spend, that they once assumed was lost to taxation.   The negative effect of lower revenue to the government, is overcome by higher tax revenues later, due to the multiplier effect of economic activity.   For this to work best, the American people have to go out and spend the money right away, rather than save it, and its helpful if they spend it on things that generate more jobs, such as consumer goods, rather than saving it.   Spending boosts the economy faster, since the money goes to the people profiting from the sale of the item, and presumably either reinvest the money they make or spend it again themselves, and they do so in a quicker turn around that if a bank receives the deposit of the rebate, then offers a portion of that money out in loans, which have to be repaid with interest.  then the interest is deposited, and loaned out again, but it all takes time and each transaction has a reserve requirement that is not the case if the money is just spent.

Answer 2

Here's an article on the subject.  We are still waiting on our check.  Some people I know have already received theirs.

http://www.freerepublic.com/focus/f-news...

Answer 3

The government passed an economic stimulus package that gave 1.5 billion dollars back to U.S. taxpayers. People got anywhere from 300 dollars (if single and employed) to 1800 dollars (if married, employed, but not making over 150,000 per year)...there are a bunch of weird qualifications behind it but thats not important. It works because people get this extra money and the want to spend it. When they go spend extra money, the economy is boosted because consumer confidence has increased. It is already working too, because retail sales have gone up a full percent this month.

Answer 4

consumer confidence and consumer spending fuels a healthy economy by keeping the wheels of commerce oiled.