Mark Gregory Turansky

I recently read an article about how the tax cuts in the stimulus package would affect me.  This particular sentence caught my eye:

Officials estimated it would mean about $13 a week more in people’s paychecks this year when withholding tables are adjusted in late spring. Next year, the measure could yield workers about $8 a week. Critics say that’s unlikely to do much to boost consumption.

I originally thought the same thing.  $1000 over the course of a year is not much money for me to spend.  I wouldn’t explicitly spend $13 more per week.  It would sit in my checking account, because that’s where my direct deposit goes.

And that’s the point.  It will be deposited in the bank (specifically checking, which were the original bank accounts needed for reserve requirements) and sit there, quietly recapitalizing banks with taxpayer money but leaving the money in taxpayer hands.

I like this plan — if this is, indeed, the purpose of the tax cut — a whole lot better than TARP simply handing money to banks without accountability.  Recapitalize with my money, but let it remain my money.

It’s a little bit brilliant.  Forget the critics.