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Thursday, January 24, 2008
“Will Plasma TVs really end the recession?”
The Atlanta Journal-Constitution
It looked sleek. Sounded even better.
I asked the Bose sales associate how much the home theater system would set me back.
“Four thousand dollars” she said, without blinking.
Throw in the $1,500, 42-inch TV and you’re talking some serious cheese.
But hey, that’s OK. I may have a little extra change in a few months. And if I do what the government wants, I’ll spend every dime.
I’m sure you’ve heard about the bipartisan economic stimulus package. The economy’s a mess. It’s hard to say whether we’re at the beginning of a recession or knee-deep in one.
The one thing that economists, academicians, experts and politicians agree on is that the economy has hit a snag. It needs resuscitation. A targeted, temporary and timely fix.
One element in a $150 billion proposal would give taxpayers money to spend. The amount of the lump-sum refunds hasn’t been worked out yet. It might be up to $800 if single, or $1,600 if married, according to news reports.
The basic premise is this: Consumers, it is hoped, will spend the rebate checks on plasma TVs, stereos and appliances. With the spending surge, the thinking goes, the retail economy will see an uptick that positively affects businesses and the overall market.
So this is the big cure. Spend. Buy a flat-screen.
It’s an idea with a weak track record. Besides, isn’t spending part of the problem?
We accumulate debt, get in over our heads, then struggle when bills come due. For many, it’s become the American way. Now our government stands ready to cut checks and encourage us to consume. Not to save or pay bills, but to be materialistic gluttons. Seems to me we should be encouraged to do otherwise, given, among other things, rising fuel and food costs.
Some experts tout the so-called trickle-down effects of the stimulus package. Say consumers spend most of their rebate checks on electronics. In theory, then, retailers and companies would invest in the market by hiring more workers.
That might happen. It might not. Even if it did, I’d imagine the hires would be temps, given that full economic recovery isn’t expected till 2009 or 2010.
There’s also supposed to be a benefit for U.S. businesses that sell more TVs, stereos and such. I foresee only one clear winner: China, where many of the products we consume are made. And where the U.S. may turn for the billions needed to pay for the stimulus package. More debt. Wonderful.
A friend and I talked about these issues during a workout Wednesday at Gold’s Gym of Lilburn. If we can see it, then surely policy-makers with supposedly impeccable smarts and insight can, too.
Whatever the amount, the rebate money will be a major component of any economic push. Checks probably won’t arrive till this summer. Taxpayers will have to decide whether to spend it, save it or pay bills.
The windfall won’t burn a hole in my pocket, though the Badie Tour saw some desirable merchandise at Discover Mills on Wednesday. Like a pair of black Kenneth Cole boots ($119).
I’ll pass. Same goes for the Bose home theater system. Too expensive, even with the Bose credit card, which advertised an 18-month, no-interest plan on purchases for qualified buyers.
Rick Badie’s column appears on Sundays, Tuesdays and Thursdays. Contact him at 770-263-3875 or email: rbadie@ajc.com.
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