Congress Reaches Stimulus Deal
ALEX CHADWICK, Host:
This is DAY TO DAY. I'm Alex Chadwick.
MADELEINE BRAND, Host:
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CHADWICK: Brian, welcome back to the show.
BRIAN NAYLOR: Thanks, Alex. Good to be here.
CHADWICK: First thing people want to know, I think, is the tax rebate that they've been talking about that are part of the package - how much is it going to be?
NAYLOR: It looks like there will be $600 rebates for individual filers, $1,200 for people who file, for couples; plus there will be a bonus for children: $300 per child. That's the general outline. There is also a limit, however, so if you make more than $75,000 a year as an individual or 15, or rather $150,000 as a couple, you won't get anything.
NAYLOR: And there - I should say, there are also business tax breaks in there as well.
CHADWICK: Now, this is a rebate, so...
CHADWICK: ...when might this be appearing in the mailbox?
NAYLOR: Well, that's a little unclear. We've heard from the IRS and from experts on the IRS who say it's going to take a while, first of all, because the IRS is now involved with the annual filing season - taxes due April 15th - and getting those refund checks out and all that processed. So it may be a few months after that. It could be as late as June, by some estimates. I guess it all depends on how long it takes the IRS to write up some new software programs to be able to figure out who gets how much.
CHADWICK: Wouldn't it be quicker, Brian, to just say, hey, let's give everybody a tax credit right now because this is - everybody's getting ready to file, right? And so write off, you know, $600 or $1,200 for a couple as a tax credit.
NAYLOR: Well, you might think that. The problem is, is that Congress and the administration want to get these checks out into people's hands in the form of here is a check from the United States government for $300, go out and spend it. And so if you do it that way, the benefit is, is that people will more likely go out and buy something; whereas if you do it in the form of a tax credit, people aren't going to see that as a tangible kind of thing that they can hold in their hand and there won't be that same kind of jolt to the economy that the administration and Congress is hoping for.
CHADWICK: This is going to feel like free money, a check from my good old Uncle Sam who wants me to go have a good time.
NAYLOR: That's it. Go out and get yourself a nice new TV set or a set of tires for the car or whatever, and that's exactly what economists say is needed. Consumer spending is needed to drive the economy.
CHADWICK: Now, the Democrats were pushing to extend unemployment benefits at one point and include more money for food stamps. What happened to that?
NAYLOR: Well, they gave up on those calls in return for getting a tax rebate to people, virtually all of those on the low end of the economic scale. The original proposal would've just given it to those who pay income taxes. But there are a lot of folks out there in the tens of millions who don't pay income taxes, so this plan gets the money out to them but they - the Democrats did not get the added food stamps and economic - unemployment benefits.
CHADWICK: How about concessions from the White House or from the Republican side of the debate here?
NAYLOR: I think the Republicans gave up two things. First of all, you know, before the negotiations even began, they agreed not to try to extend the president's temporary tax cuts beyond 2010. That's going to be a debate for another day, but that was always high on the Republicans' agenda and high on the president's agenda.
CHADWICK: $75,000 individuals, $150,000 for couples. Republicans would like to have seen a more broader based, a more upper income-based rebate program.
CHADWICK: You know, Brian, I'm struck by the speed with which all this has come about. The president offered his stimulus package just a week ago.
NAYLOR: It's remarkable, Alex, something you don't see around here very often. But I'm told that basically all of this was worked out yesterday in the course of three meetings between the Republican, the House speaker and the treasury secretary. I think it's evidence of the concern that all parties have about this economy.
CHADWICK: Brian, thank you.
NAYLOR: Thanks, Alex. Transcript provided by NPR, Copyright NPR.
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