The stimulus checks sent out by the government were not just free money. There will be a price paid for all the money printing that has occurred. If there is one thing for certain that most people should know, politicians in Washington are often out of their minds and have no control when it comes to spending America’s money. There is no question the pandemic with Covid created some real economic problems. However, stimulus checks are not going to solve most of the trouble with money for Americans.
Receiving a stimulus check in the mail might be a good short-term solution for some people that truly need the money but in the long run, some of these same people that cashed the check will pay the price. Receiving a stimulus check in the mail might be a good short-term solution for some people that truly need the money but in the long run, some of these same people that cashed the check will pay the price.
Nothing Is Free
Although so many people were happy to get their stimulus check believing it was just free money with no strings attached, this is only further from the truth. Stimulus checks are debt no matter how you look at it. Money now that will have to be paid back in the future.
How is the government going to collect the money it sent out to supposedly help people during the pandemic? If you guessed taxes, you would be correct. These taxes for the stimulus debt are going to be paid for by the people that received a check and people that did not. Future generations will likely be paying the stimulus check debt for some time.
When the government supposedly gives out “free money” you should always be asking yourself who is going to be paying it back. The answer to this will almost always be the American taxpayer.
Stimulus Checks Will Never Solve American Money Problems
I can’t argue the pandemic put some people truly in need of some economic help. The truth is more of the stimulus money probably should have gone to these people instead of an across-the-board check for many Americans. There are a lot of people that do need help to buy groceries or pay the rent. However, a lot of the “free” stimulus money went to people that either shouldn’t have gotten it or don’t need it.
Mailing out checks to most of America despite their work status was a poor decision by the politicians in Washington. A lot of the money issues Americans have is with spending money and a stimulus check without having to work for it only makes matters much worse. Much of the stimulus money will be used on things people likely do not need. The American taxpayer is basically borrowing money to fulfill their demand for consumer goods. How does this help teach people to be responsible with money?
Part of the problem with the pandemic and many Americans not having money in an emergency is the fact that so many people live above their means day-to-day. A lot of people do not save money for the unknown. I have brought up the observation previously with the food lines when the economy was shut down and the fact there were so many people waiting in lines within the comfort of their new automobile. There is a real issue when people have auto payments that equal the price of their rent and then they can’t afford a few weeks of food when the economy is shut down.
The U.S. doesn’t need more consumer spending which is basically what much of the stimulus money is providing. It is more borrowed money to buy stuff that people do not need. There is data through a U.S Census survey suggesting that 85.5% of the respondents stated they would use their stimulus check for household expenses. However, what qualifies as household expenses?
Who Really Benefits from a Stimulus Check?
There are people that do need the stimulus money to buy food and pay rent. However, the real benefit is going to likely go to Amazon and home improvement stores, such as Home Depot or Lowes.
A trip I took to my local Home Depot the day following a stimulus deposit for many Americans proved household expenses were not just for food or the mortgage payment. I hadn’t realized why Home Depot was so crowded during a weekday until my wife mentioned the reality of a stimulus deposit for many people that week. Home Depot looked like there was a zombie apocalypse. So many people were using their supposedly free money not for much-needed household expenses but more for home improvements.
Amazon was only sure to benefit from the “free” stimulus money with more people staying at home due to the pandemic. Although the government was also helping small businesses with loans to help during Covid, they were also helping to put many of these small businesses out of business by improving the profits at Amazon.
The statistics site Statista.Com came out with a study by the U.S. Census Bureau that showed the following on how most Americans used their stimulus checks.
Looking at the list above it should clearly appear to be a problem that 22% of people in the survey used their stimulus money for auto loan payments. The 20% that used the money to pay a debt is a good thing along with 12% going into savings and investments. Yet, I have to believe the household supplies is home improvement while food at 59% might also include dining out.
Americans love their automobiles and 22% of people paying auto loans with their stimulus money clearly seems to be a problem. Auto loans are a big reason why so many people in the US are living paycheck to paycheck. Having an auto loan has become such a normal part of life while it shouldn’t really be the case.
It is clear the people spending the allegedly free money are using it for things other than necessities such as rent or food. The economy benefits short-term from the money the government printed but much of it is going to large global companies. The only thing a government check is stimulating is more spending when most Americans should be learning to save more.
Stimulus Checks Uncover a Bigger Problem
One of the larger issues the government stimulus money is showing is how disconnected the politicians in Washington really are. If a $1200 or $1400 check is going to be life-changing for anyone during the pandemic, those people likely have much bigger problems.
The money the government printed to help people during the pandemic really doesn’t do much. It might help those really in need for a month or two but realistically that is about it. Who in their right mind would think that $1200 is going to help someone that might have been out of work for a year with no savings living paycheck to paycheck?
The people truly struggling could certainly use some help but the amount the government sent out only creates a bigger problem in the long run. The money will eventually need to be paid back. The reality is a lot of the people that were mailed a stimulus check are not out of work. These people already are saving more money from being at home more and not living a normal life. That stimulus check is really thought of as just free money to many of them. Money, they did not have to work for but an amount so many people yet realize will have to eventually be repaid.
Government stimulus checks did help some people. However, what it really showed is that politicians in Washington are more disconnected than they probably ever have been. Furthermore, the stimulus money just shows how most people are not able to save money when they should be. Although a lot of people have more disposable income as a result of the pandemic, much of the stimulus money handed out has not been saved. Politicians in Washington do not certainly set a good example when it comes to financial responsibility and debt. Sending out what many people feel is free money is irresponsible.
Repayment for Stimulus Checks Will Need to Be Made
With America already in debt for trillions of dollars, the stimulus money sent out almost feels like just another run of the credit card through the Washington money printing machine. The problem is all the money being made will need to eventually be repaid. The result is no doubt going to be an increase in taxes and not just for the wealthy as so many politicians often claim.
The truth is the government needs to learn how to save money and pay debt. Instead, elected officials have only learned how to spend irresponsibly with America’s money. It should not be a surprise that Washington’s answer to a problem is just to throw money at it. They tend to do this regularly. However, it will likely come as a surprise to many recipients of the stimulus check when they start to pay more in taxes.
An increase in taxes for the U.S. is inevitable with the amount of debt that has been accumulated. This includes not only the stimulus packages the government handed out but all the additional expenditures the government has turned a blind eye to overtime. Spending that is often not in the best interest of America but only benefits campaigns, corporations, and wealthy elites.