According to the Financial Times, US incomes surge as stimulus kicks in.
Personal income in the US surged in May thanks to an infusion of government stimulus funds, while consumers raised their spending modestly as confidence about the state of the economy continues to improve.
However, most of the monthly rise was the result of Federal benefit transfers and lower taxes. Americans, still facing rising job cuts and falling home prices, have been hoarding most of the additional funds, lifting the savings rate to a 16-year high in May....
The sharp rise in spending was mainly due to benefits payments doled out through the American Recovery and Reinvestment Act of 2009, which provides one-time payments of $250 to people who receive social security funds, veterans’ benefits or railroad retirement income. Although disposable personal income, which factors out taxes, rose by 1.6 per cent in May, it increased by just 0.2 per cent without the stimulus benefits.
Pity the poor conservatives. To a member, the house GOP voted against the stimulus and no Senator who is presently a Republican and comes from a state west of Maine voted for it. So it is clearly a Democratic bill, which means that Republicans are obliged to feel depressed every time a smivet of good news like this comes out.
7 comments:
If only we could persuade the rich to just *spend* all their money. No, not even all of it. Just most of it. All except about $50K a year, which they could keep for a rainy day.
Shrimplate,
Of course being rich means having enough money to spend on what you want when you want to (anyone have a better definition of 'rich' I'd love to hear it.)
Which of course makes the present legislative proposal for a 'flat tax' show up as it's ridiculous self.
If 'rich' people (who could in theory not be making much money if they also didn't spend much, but who most likely include a lot of high income earners) get an income tax cut then they are more likely to just sock it away where it will never see the light of day.
According to my observations today at K Mart, most people are spending their few extra stimulus dollars per paycheck for backyard wading pools for their kids and grandchildren.
How many rich people are building a new in-ground model?
sandyh,
At least those who have a somewhat secure job are spending it for that. The rest of them are spending it on food.
Jack,
You are probably right. Those who are underemployed are finding it harder all the time to make ends meet.
But as one of our Missouri state senators said, "Hunger is a great motivator" as she suggested doing away with school lunches for poor kids during the summer. Once a kid turns 16, the Republicans want them to be self-supporting.
I'm sure all their children will be.
Or to pay bills.
Don't feel bad, Sandy.
My own GOP state senator was just caught saying on the floor of the legislature that the earth is only 6,000 years old.
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