Rebate Checks Alone Won’t Rebuild the Economy

By Blanca Rojas

As millions of Americans receive their tax rebate checks in the mail, the government is waiting to see whether this cash infusion will trigger a mass spending spree. Supporters believe this strategy will create rebate-fueled purchasing power that will give consumers the confidence they need to purchase that new flat-screen TV or simply pay off their overdue bills, jolting the economy back to life in the process.

The problem with this scenario is that no one can predict whether the rebate checks will do the job. Rebate checks are only one piece of the economic recovery equation; Congress must also create a growth package that contains proven initiatives for pulling the country out of a recession. This package should include four things: an expansion of unemployment insurance, a temporary increase in food stamp benefits, increased aid to state and local governments, and investment in infrastructure projects that would immediately put people to work.

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