When the majority of people living in America hear the term “stimulus package,” they think of tax rebate checks, various tax cuts and the like – things that are utilized in an economic recession to help struggling citizens weather the storm until greener pastures can be reached. To a large extent, this is accurate; this is the modern definition of a stimulus package. However, there is a lot more to a stimulus package than just free money – in fact, the money is coming out of someone’s pockets eventually, just not right then, or in that specific way. In fact, there is a further emotional component to a stimulus package that is its true purpose. A stimulus package not only gives financial aid to desperate people on behalf of its ruling government, it allows them to be inspired to take the action needed to justify and pay for the package in the first place.
The dictionary definition of ‘stimulus’ is “something that rouses or incites to activity.” (Merriam-Webster, 2011) In a substantial way, this is what a stimulus package does – it is a measure of tax relief that is provided to people, so that they may use that money to be incited or roused to purchase things that they need or want. This action then puts money into industries that need more business, which will allow them to continue to prosper and provide the services that those same people will keep using. If done well, a stimulus package is able to kickstart the economy and provide businesses the income they need to stay afloat. Without a proper stimulus package, economies that are experiencing a decline in spending will just go out of business, as they will not have the means to cover their operating costs and the pay of its employees. These employees will then be out of work, with no money to sustain their homes or feed themselves, much less put it into business. The stimulus package intercepts this decline, injecting much needed capital into the economy, thereby keeping employees on the payroll and spending money on essentials and luxury items, all of which will keep the manufacturers and distributors of these products and services in business.
Merriam-Webster’s collegiate dictionary (11th ed.). (2003). Springfield, MA: Merriam-Webster.