Last night as I was driving to an appointment, I was listening to our local NPR affiliate here in Grand Rapids, and specifically to the show Marketplace. I happened to hear a story about how the government and economists were concerned that the money given to taxpayers via the “economic stimulus package” may actually be used for purposes other than retail spending, thereby not causing the intended “stimulus.” Not the first story of this sort that I’ve heard over the last few weeks.
The difference in this story was that it was being reported that the IRS was now being proactive in ensuring that the stimulus money was being spent “properly” by actually spending the money in advance for a certain class of taxpayers who had been identified as likely to not spend their rebates.
Naturally, I found the story outrageous. So outrageous, in fact, that I was talking back to my radio, and in fact probably talked right over the most important part of the story.
So today, when I noticed that Jordan Ballor had written a post on spending the stimulus, my mind immediately jumped to the outrageous story from the radio. I found the story link on the web, grabbed a few quotes from the transcript of the story that (I thought) I had heard in full, and posted away.
Only to have Jordan direct my attention a few moments later to the last line of the story:
Oh, c’mon, check your calendars, everybody.
Wow, did I feel stupid. Still do, actually.
Anyway, I didn’t have time at the moment to add a correction to the post as we were all busy packing up after today’s Chicago event, so I pulled the post off the blog. Now that I’m off the road, however, I’m re-posting it so that I can really embrace my stupidity. After the jump, enjoy a laugh at my expense.
Here’s Your Air Conditioner, Courtesy Of Your Friendly Neighborhood IRS
Jordan Ballor, in his post on Spending the Stimulus, had this to say:
I take issue with the idea that the government gives us money that is our own in the first place, and then tells us how we ought to spend it: on consumables and retail goods to spur growth in the economy.
Instead, I propose that people “should use this rebate money as they see fit, since they are the ones most familiar with their own situations and their own needs. Consider giving part of the money to charity or saving, paying off debt or investing. And if it makes sense for you and your situation, you should feel free to buy that hi-def TV if you so desire.”
“But you certainly should not feel obligated to do so as if mere consumption is a civic responsibility,” I add.
The Internal Revenue Service thanks you for your input, Jordan, and kindly requests that you cram it.
Gordon and Stacey Atkinson live in Phoenix Arizona, in a home they bought with a subprime loan.
GORDON: Come on in.
Like many subprimers, they’re having a hard time paying the mortgage. So, eager for their $1,200 rebate check, they filed their taxes in February.
STACEY: And I was expecting — or we were expecting — a rebate check shortly thereafter.
It eventually arrived. Sort of.
GORDON: We get this thing in the mail. It’s addressed from the IRS. I had no idea what it was.
STACEY: So, we open up the package, and, well actually, I can show you what was inside of it. Do you want to come see it?
RICO: Yeah, sure.
STACEY: It’s an air conditioner.
Yes, that’s right: for a certain segment of taxpayers, the IRS is taking no chances and spending the stimulus on their behalf.
After they got over their shock, the Atkinsons called the IRS for an explanation. So did I.
BEVERLY JAWORSKY: My name is Beverly Jaworsky. My title is Debt-To-Purchase Ratio Assessor.
Armed with a huge IRS database, Beverly and others like her have spent the last few months identifying taxpayers who’d be most likely to use their rebate checks to pay off debt.
JAWORSKY: Someone who may be listing their house on the market as a short sale, for instance. Or students with student loans. Or screenwriters.
Then those taxpayers get special rebates.
JAWORSKY: Instead of receiving that check that they were going to receive, we send it to them in the form of retail goods, in relative value to what their check would have been.
In other words, the government makes sure these taxpayers’ rebates get spent in the manner intended by spending it for them. On stuff. But how to be sure it’s stuff the taxpayer actually needs?
JAWORSKY: You know, we plug in Social Security numbers into our database, we find where the people live, and we send them something that would be suitable to their lifestyle.
That’s why a couple in the Arizona desert might get an air conditioner. Someone in Boston might get a snowblower. Jaworsky says the program will target only about a million taxpayers, but that equals close to a billion dollars guaranteed to be injected into the economy.
I can’t tell you how offensive I find this. And heck, if this is all it takes to get the economy going again, why doesn’t the government cut out the middleman and just buy a billion air conditioners and snowblowers? Why, we’d all be living high on the hog then.
I need to go lie down.