Washington, D.C. - U.S. Congressman Kevin Brady (R-Texas), a member of the Joint Economic Committee, supported passage today of the Recovery Rebates and Economic Stimulus for the American People Act of 2008 (H.R. 5140) championed by President Bush and agreed to by leaders of both parties in the U.S. House of Representatives. 

The measure provides tax rebates up to $600 per person and $300 per child to families, plus incentives for businesses to invest in new equipment and expansion.

“I don’t need much of an excuse to give people back their own tax money, especially with prices so high and the way we waste that money here in Washington,” said Brady. “So I support this measure.”

But Brady cautioned his congressional colleagues about overselling the bill.

“Let’s not hold a parade for ourselves just yet. While economic estimates vary, I am skeptical about how much impact this small package will have on America’s large and complex economy. I hope it does, but I worry that in the end it may become more a political stimulus than a true economic stimulus.”

The good news, says Brady, is that the American economy is so strong and resilient that it recovers quickly from major challenges – from the dot-com crash to attacks of 9-11, for example.

“There’s no question the housing downturn and future credit crunch are real and we should look for ways to limit their impact – but not in any way that prolongs the problems or creates an excuse for a spending spree that we can not afford.” 

Under the bill Americans earning at least $3,000 would be eligible for a rebate of $300 per person or $600 per couple, plus $300 per child.  Taxpayers making less than $75,000 or $150,000 filing jointly, will be eligible for $600 rebates, $1,200 per couple - plus a $300 rebate for each child. Taxpayers with higher incomes will have the rebates reduced.

The bill also allows companies to write-off 50 percent of new investments that are subject to current 20 year depreciation rules or less.  Many small businesses may also expense the entire cost of new investments up to a limit of $250,000.  Lastly, loan limits for Freddie Mac, and Fannie Mae have been increased to help ease the strain on our housing markets caused by the sub-prime crisis.

“In the end, we should remember that it’s not Washington that creates jobs, but rather a business and tax climate that rewards rather than punishes Americans for working smarter, succeeding and developing the innovations that our changing world demands.”