Bankruptcy & Foreclosures

A while back I posted with the interesting news that part of the stipulation associated with receiving our economic stimulus tax rebate checks was that we were told to spend them. Without delving too deeply on the whole theory of economics, the reasoning is simply that spending money frivolously could give our stagnant economic waters a little push.

Now for the disturbing news: With oil prices continuing to climb to record highs, many Americans are literally dumping their rebate down the tubes. Not to insinuate that we won’t all immensely enjoy using this bonus check on an integral ingredient to the internal combustion process, the real problem is that by purchasing fuel with our rebates, we are boosting an economy but not our own.

With gasoline averaging close to $3.75 per gallon and the average American good for just under 600 gallons per year, we’re looking at $2,250 per person in fuel costs for 2008 (assuming oil prices do not rise further). Compared to the $600 per individual rebate check, our bonus is a drop in the proverbial bucket (or in this case, a drop in the literal barrel).

The sad news is that even if we are able to convince ourselves that we are in fact spending our tax rebate check on domestic goods or services, the fact remains that we’re dropping alarming figures on fueling our cars, trucks, SUVs, and lawnmowers. Worse yet is that as a result of the rising fuel costs, nearly all areas of society are feeling the impact be it grocery costs, dining, clothing bills, etc.

So the bottom line is that until our government figures out how to lower the cost of oil, tax rebates and rate cuts are band-aid fixes to a much deeper national wound.