Government may extend stimulus measures
The September jobs report sent a message to Washington: The recovery, and the $787 billion stimulus package enacted earlier this year, may be swamped by unemployment.
Now there are indications that several key measures of the stimulus package may be bolstered or extended, the The Wall Street Journal reports.
One program would extend unemployment-insurance benefits beyond the end of the year. Another would kill the expiration of the tax credit for first-time home buyers. Perhaps the most important would be a plan to maintain a program that offers tax credits to help defray the often huge costs workers face if they want to purchase the health insurance they had on the job after they've been laid off.
Of course, all of this will cost the taxpayers money, now or in the future. The increases in major benefit programs will cost the government billions of dollars beyond what has already been committed. One way to fund that would be to raise taxes now, which could cripple consumer spending power more than it already is.
The other path is for the Treasury to borrow more money and increase the amount of the national debt. The taxpayer will get to pay that bill in a few years That may help get the government out of its hole but will cause an addition to what are already likely to be higher taxes for a decade or more.
Saving the economy now has a price, which is to potentially weaken it in future.
Douglas A. McIntyre is an editor at 24/7 Wall St.