Not a tax cut.

Russ Roberts rocks.

The payroll tax credit is a rebate of payroll taxes for low-income workers. As faithful readers of this blog surely know, an increase in spending coupled with lower tax collections is an INCREASE in taxes. AN INCREASE in taxes. NOT A TAX CUT. If I spend more money and collect less, the government is promising to collect more taxes in the future. It is not a tax cut. Not a tax cut. Not a tax cut. And when you don’t cut rates but rather give people a lump sum of $500, there are no incentive effects other than to increase the probability that the US Treasury will be unable to honor its obligations in the future. — Russ Roberts

If the government cuts rates or just gives rebates but at the same time increases the size of government, taxes are not lower. They’re larger. Government is taking a bigger share of the economic pie leaving less for the private sector to spend. The future burden of taxes is higher. As Milton Friedman used to argue, don’t focus on how government is financed, whether it’s out of current taxes or future taxes. Focus on the spending. If government grows as a percentage of the economy, then the burden on the private sector is bigger. — Russ Roberts

Hoping [Obama's stimulus] plan won’t have any pork in it is like hoping a ham sandwich won’t have any pork in it. It’s just a tad unrealistic.

Increase spending! More tax cuts! Stay in Iraq! Faith-based funding! Change we can belie… oh, whatever.