Many Americans have been eagerly anticipating their economic stimulus checks, the first of which were distributed in early May. But, as teenagers are so often told, money doesn't grow on trees. The money being distributed now has to come from somewhere.
Because the U.S. government does not intend to "alter its spending plans, these tax holidays will be funded by government borrowing, borrowing that must eventually be repaid. That will require taxes to go up in the future or not to fall when they otherwise might," according to Tim Harford of Slate.
The government, Harford pointed out, is handing its "citizens cash that was borrowed—and the citizens themselves are liable for the debt. If my bank manager arranged a surprise loan in my name and handed me the cash, I might feel pampered or put-upon, depending on whether I was planning to take out the loan myself anyway. Either way, doubt I would feel any richer."
Though it is impossible to tell exactly when and how taxes will be raised in the future, Harford predicts that teenagers, "very few of whom pay income tax today but most of whom will pay income tax in the next few years", will take the financial fall.
