Define Economic Stimulus | Define Stimulus | Economic Stimulus

Define Economic Stimulus

Please note: This page was written by the same writer who composed moving companies in Denver, Colorado.

A stimulus, by definition, is an act meant to arouse action.

An economic stimulus, ideally, is an investment designed to jumpstart something – more jobs, more consumer confidence, more investment, more growth.

In 2008 and 2009, many types of economic stimulus packages, economic stimulus plans, and economic stimulus bills were introduced, all designed to save or jumpstart something.

In 2008, the federal government gave a $29 billion economic stimulus to sweeten the deal between Bear Stearns and JP Morgan Chase…it gave $178 billion in economic stimulus tax rebate checks to Americans to get them to spend more (but most people took the windfall and stuffed it into savings accounts)…it gave $300 billion in assistance to American homeowners to help stave off foreclosure or to encourage them to buy their first home…it gave $200 billion to Fannie Mae and Freddie Mac, the mortgage biggies, to prevent their collapse…it guaranteed $50 billion to preserve the safety of money market funds…it loaned $25 billion to prevent the collapse of the Big 3 automakers (Chrysler, GM, and Ford)…it gave $150 billion in economic stimulus loans and investments to AIG, the insurance giant, to prevent its collapse…it gave a $700 billion economic stimulus package (TARP) to banks to get them to start lending money (but most took the windfall and stuffed it into their own rainy day funds).

In 2009, the federal government kept giving…it gave a $787 billion economic stimulus to be distributed across America in the form of tax relief, assistance to state and local governments, investment in infrastructure, health care, science and energy, extension of unemployment benefits, and more…it gave another $200 billion to Fannie and Freddie to prevent their collapse…it gave $75 billion more to homeowners to entice them to buy new homes or stay in their “under-water” homes…it gave another $30 billion to AIG to, once again, prevent its collapse.

All told, more than $3 trillion has been committed in American economic stimulus packages, economic stimulus plans, and economic stimulus bills…most of it to prevent collapses, not, per se, to stimulate.

Given the massive hemorrhaging in 2008 and 2009, maybe “stemulus” is a more apt term than stimulus.

_____________________________________________________________