Bush Signs Bill, Checks In Mail By Spring

Under Economy-Rescue Bill, Millions Of Americans Will Get Rebates From $300 To $1,200

(CBS/AP)  The checks aren't in the mail, but they will be soon.

President Bush signed legislation Wednesday to rush rebates ranging from $300 to $1,200 to millions of people, the centerpiece of government efforts to brace the wobbly economy. First, though, you must file your 2007 tax return.

More than 130 million people are expected to get the rebates, starting around May. Congress, Bush, the Federal Reserve and Wall Street are hoping the money will burn such a hole in people's pockets that they won't be able to resist spending it. And the spending is supposed to give an energizing jolt to a national economy that is in danger of toppling into a recession if it hasn't already.

Whether people actually spend the money remains to be seen. A recent Associated Press-Ipsos poll indicates most people have other plans. Forty-five percent said they planned to pay off bills, while 32 percent said they would save or invest it. Only 19 percent said they would spend their rebates.

The measure Mr. Bush signed — a $168 billion rescue package passed with lightning speed by Congress last week — includes not only rebates for individuals but also tax breaks for businesses to spur investment in new plants and equipment. That, too, would help bolster U.S. economic activity. The package also contains provisions aimed at helping struggling homeowners clobbered by the housing collapse and the credit crunch refinance into more affordable mortgages.

Flanked by congressional leaders of both parties, Mr. Bush was quick to share the political credit with them for enacting the stimulus bill, reports CBS News White House correspondent Mark Knoller.

The emergency plan marked a rare moment of cooperation among political rivals fearful that an ailing economy during an election year would invite voter retaliation.

Bush, who called the measure "a booster shot for our economy," praised the bipartisan cooperation. "We have come together on a single mission — and that is to put the people's interests first," he said.

Who gets a rebate? Most people who pay taxes or earn at least $3,000, including through Social Security or veterans' disability benefits. Singles making more than $75,000 and couples with income topping $150,000, however, will get smaller checks, up to the top limits for any rebate: incomes of $87,000 for individuals and $174,000 for couples.

To get any rebate, you must file a 2007 tax return and have a valid Social Security number. If you already filed your 2007 return, the IRS says you don't need to do anything extra.

Most taxpayers will receive a check of up to $600 for individuals and $1,200 for couples, with an additional $300 for each child.

People earning too little to pay taxes but at least $3,000 — including elderly people whose only income is from Social Security and veterans who live on disability payments — will get $300 if single, or $600 if a couple.

The IRS will send out rebates — by mail or by direct deposit into your bank account — through the late spring and the summer. The rebates come in addition to any regular tax refund.

To pay for the rebates — which are estimated to cost about $117 billion over the next two years — the government will have to borrow more money, enlarging the budget deficit.

The Bush administration and some private economists are hopeful the rebates, tax breaks and aggressive interest rate reductions by the Federal Reserve will help the country narrowly dodge a recession. An increasing number of economists, however, believe the country has already fallen into its first recession since 2001, and they are simply hopeful the rescue package will limit the damage. Most people — 61 percent — say the economy is now in a recession, according to the AP-Ipsos poll.

"I do think this will give the economy a shot of adrenaline," said Stuart Hoffman, chief economist at PNC Financial Services Group.

The National Bureau of Economic Research, a private research organization, looked at what people did with their 2001 rebates. The study found that "households spent about 20 to 40 percent of their rebates on nondurable goods" — which can include things like food and clothing — in the first three months. They spent roughly another third in the following three months.

With the current stimulus, the economy will log growth in the range of 2.25 percent to 2.50 percent in the second half of this year — roughly one full percentage point higher than without the bracing tonic, Hoffman estimated. That would be closer to a more normal rate of around 3 percent, he said.

That in turn should encourage businesses to step up hiring. Nervous employers cut 17,000 jobs in January, the first nationwide loss of jobs in more than four years.

Edward Lazear, chairman of the White House Council of Economic Advisers, predicted, "The stimulus will have the effect of increasing jobs by about half a million above the number that would have been the case in the absence of that."

Still, even with the rescue efforts, some analysts fear the economy could backslide and flirt with recession again in 2009.

To help the severely depressed housing market, the stimulus package would raise temporarily to as high as $729,750 the limit on Federal Housing Administration loans and also raise the cap on loans that mortgage giants Fannie Mae and Freddie Mac can buy.

Raising those limits, should provide relief in the market for "jumbo" mortgages — those exceeding $417,000. The credit crunch hit that market hard, making it very difficult, if not impossible, for people to get those loans. That has plunged the housing market even deeper into turmoil.

House Speaker Nancy Pelosi of California said the provisions will provide "families a second chance at the American dream of homeownership by helping them refinance their mortgages and avoid foreclosure."

[krisd999-2009]

Who are we borrowing from? But of course, the Federal Reserve. It has an unlimited amount of zeros. Enter 1, then as many 0s you need in the government''s bank account and presto, the "money" is there. Of course no one is so stupid to believe that wealth can be created with a few computer strokes, but who knows? Americans and their representatives in Congress seem to believe it. Just like the Federal Reserve''s fiction, there is an unlimited amount of stupidity in this country. They will later, cluelessly, scream about their wages and pensions going up in the smoke of the resulting inflation. They get the government they deserve. If the people were smart, they would demand constitutional GOLD money that can not be inflated out of their hands with a few computer strokes. If not, the mayhem since going off gold in 1971, will continue.

[killtheliars]

the "Boosting our Economy" sign in front of him kind of reminds me of the mission accomplished sign. It should this will be another Bush failure

[inventagod]

However, if China declines the Bu$h credit request, it may never happen...

[samael2014]

Actually, what''s really important is that this gives greater momentum to heavily taxing future American taxpayers into oblivion; so that the parasites of today can profit at their expense. All this business about avoiding a recession is a pipedream and irrevelant. What''s important is that future American taxpayers, who will also simultaneously be very heavily dependended upon for greatly increasing products and services by the same retiring and upper-class welfare demanding Republican Parasite Collective, will when also faced with staggering inflation, plummeting dollar value and what must inevitably be increased taxes and decreased expectation for the same high quality retirement care as the parasites who are getting "tax relief" now; will make the obvious and clear choice. Supplement the dwindling working class of other countries (esp. Europe) who more than welcome the influx of educated and highly trained young former-Americans who are looking for almost anything better than what these greedy self-serving retiring parasites in America can offer... anything. Good-bye greedy baby-boomers and upper class welfare conservatives -- your time for payback will come in the form of abandonment... and there is nothing you will be able to do to stop it.

[aaabee-2009]

or **** because you don''''t understand!!!!
Posted by badaxmofo at 11:18 AM : Feb 14, 2008

Oh good, the only human being who sees all and understands all has spoken.

How is it, no matter what topic, you come through with all the answers?

[elliott62]

Don''t like it? Move to China whiners...
Maybe you have suckled from the teats of prosperity for too long...

[ici2i]

Let''s put a cap on oil company profits, slash fuel prices which affect all consumer costs, and see what that does for the economy........duhhhhh, that just doesn''t pander with the Repug way of rich getting richer!!!

[ici2i]

This is by far the most laughable, ineffective tactic this administration has taken to date. What a farce but a nifty slight of hand. Assuming I get any $$ at all, a much higher percentage of my income now goes toward fuel whihc is where this $$ will end up. But isn''t that the big Bushit plan. Isn''t it possible to conclude that a large portion of the rebates will assist the poor oil companies with their profit margin?
I see eye to eye (ICI2I)

[mcv57]

http://www.globalincidentmap.com/home.php

CbS news is such a puppet propaganda stooge. This is so political incorrect. See the above site, you want real "on the minute world news."

[aaabee-2009]

Ha, good one. You actually think the next president will pay it back. Whoever it is will have their own agenda that will cost plenty, democrat or republican.
Posted by deemsnyd at 10:51 AM : Feb 14, 2008

Sandwiched between two pork-ridden Bush administrations, the Clinton administration seemed to be able to get America out of the red, and still spend money on programs that helped people and the environment.

[deemsnyd]

So this year, Bush is lauded for spending borrowed money, next year''''s President will be hung for working to pay it back. Good job.

Posted by AaaBee at 10:47 AM : Feb 14, 20


Ha, good one. You actually think the next president will pay it back. Whoever it is will have their own agenda that will cost plenty, democrat or republican.

[sfetherolf]

One way the government could save millions of dollars is to get a hold on giving so many people the earned income tax credit. We don''t need rebates to boost the economy, we need to stop giving people everything and actually make people earn their money!

[aaabee-2009]

Okay, Republicans. How much of your precious tax dollars will go just to pay the interest on this new loan?

Oh, domestic spending by a Republican president is soooo fiscal, isn''t it?

"Both [R and D] campaigns promise fiscal discipline, as well as ambitious new programs. These kinds of have-your-cake-and-eat-it-too vows were merely laughable last year when the federal deficit was running at a manageable $163 billion a year."

"But the economic slowdown, the hangover from the Bush years and the growing bite of entitlements mean the federal deficit will almost certainly top $400 billion by 2009."

"The accumulated national debt will be in shouting distance of the $10 trillion mark."

So this year, Bush is lauded for spending borrowed money, next year''s President will be hung for working to pay it back. Good job.

[deemsnyd]

Please don''t tell me China.

[deemsnyd]

"To pay for the rebates %u2014 which are estimated to cost about $117 billion over the next two years %u2014 the government will have to borrow more money, enlarging the budget deficit."


Who are we borrowing from??

[bm6005]

Remember, this November to vote out ALL INCUMBENTS. Would it be inefficient? Yup, but it would stop the financial bleeding to close down this den of inequity we call CONgress. These people DO NOT represent us. Look at the attention to steroids while the country is going to hell in a handbasket. They''re attempting to distract us from the fact that they get NOTHING important done but they can all get behind the evil drugs. Wake up America it''s time to take our country back!

[bm6005]

This money is chump change but will become more than that with the interest. I''ll reluctantly take it but I will not blow it and certainly not on anything made in China. Either pay some bills or invest it but no new toys. Of course some more ammo would be nice.

[bm6005]

Bush, what a D ick!

[rf35]

I''m no economist, but I would geuss if gas cost about $1.25 less the past year or so, consumers would be able to spend more on other things and this recession wouldn''t be happening (at least not as bad). I know I, for one, am pumping much less money into the economy in general lately because I''m pumping it all into my car instead.

[aaabee-2009]

BOOSTING OUR ECONOMY is such a great slogan, love the red, white, and blue motif.

I would have preferred BOOTING OUR PRESIDENT slogan, done in a skull and crossbones motif.