You've got to spend money to spend money...

When the tax stimulus credit thing was first announced, I greeted it mostly with an eh, whatever. I didn't think it would do much to help the economy, but who am I to argue with giving taxpayers a little more of their money back?

But the more I hear about it, the more annoyed I get. First of all, there's the fact that it's a flat amount, and that people over a certain income get less or none - give more back to the people who paid less in taxes, and less back to the people who paid more in taxes. Then there is the the fact that people who have earned little or no income still get $300 - it's welfare, an out-and-out transfer payment from the rich to the poor, disguised as a tax credit. And it's the worst kind of welfare - not directed at a particular group and no strings attached.

Plus, as much as I like tax cuts, for them to mean anything, they need to be accompanied by cuts in spending, which haven't and won't happen - especially as Obama and Hillary debate whose healthcare plan will be bigger.

But then there is this - the government is spending $42 million to send out letters telling you they will be sending you money. The parents got theirs yesterday, and I'm guessing mine is probably waiting in Baltimore, stuck in stack of mail between the pennysaver and bunch of rebate checks from computer parts.

The fact that they are sending out the letters - with the first line being a shout-out to congress and the prez - suggests that the election year is the reason for this letter and the refund. Which makes me want to vote for any politician who has the balls to call out this tax refund for it's stupidity (unless it's Ron Paul or Ralph Nader).

The rebate means the country will take on more debt. And it probably won't do much to help the economy - most surveys suggest the bulk of people will either save their rebates or pay down debt. Granted, that's not horrible - it means more money for banks to loan, and that people will be on better financial footing in the future. But because everyone knows it's a one-time payment, and because it's not enough money to make a serious impact on most people's bottom line, it probably won't have much effect.

So what is madanthony doing with his $600 check (OK, $600 EFT)? Putting it in the bank, and eventually putting it towards paying off the mortgage. Right now, I'm paying PMI, and since I've never been a fan of paying money (about $80/month) if I can avoid it, my current financial goal is to get rid of it by the end of next year. That means I need to save about $20,000 up by December 2009 - which will be a challenge, but I think will be doable if I don't have any unforeseen major expenses, if I can keep my spending down, make some overtime, and sell some stuff on eBay and through other venues. The $600 will be a drop in the bucket, but at least I'll feel like I'm doing something the government would prefer I don't - save and pay down debt instead of spending.