House Reaches “Stimulus Package” Deal

The House has crafted its version of an "economic stimulus" plan that includes tax rebates, an earned income supplement (our working label for "tax rebates" to those who earn a paycheck but don’t owe any taxes), a child credit, temporary accelerated business investment deductions, and expansion of Fannie and Freddie’s mandates.

Some stubborn issues were not addressed. One is the disparity between tax rates on different kinds of productive activity, including labor. Another is the uncompetitive U.S. tax rate on corporate income. And the other is the uncertainty surrounding expiration of the 2003 tax cuts. It now appears that clarity on that issue will only come with the Presidential election results in November.

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