To the editor:

Tony Baker’s letter of Jan. 25 advocates a five-month tax holiday in lieu of the proposed $850 billion stimulus package currently before Congress. While it is certainly tempting to pocket $3,000 or $4,000 instead of sending it to the government, it is no more likely to shorten the current recession than the $160,000 billion tax rebates of last year worked to prevent it.

In times of economic uncertainty, sensible employed individuals would not rush out to spend their increased income; rather they would save it as a contingency fund or use it to pay down debt. As virtuous as those acts would be, they would not directly stimulate the economy. Like it or not (and I don’t like it), the only way to stimulate the economy it through spending, and when consumers aren’t spending, no amount of encouragement to business will induce them to produce more products they can’t sell.

If consumers won’t spend, and businesses won’t spend, that leaves the government as spender of last resort. The alternative is to let the current downturn spiral continuously downward into another Great Depression.

We simply have to have a stimulus package based largely on deficit spending, and can only hope it’s large enough, and that the money will be spent on items, such as infrastructure, likely to give some lasting economic benefit. Finally, we need to examine how we got into this mess and provide vigorous regulation of the mortgage and financial industries to prevent its happening again.

Steven Bruner,
Lawrence