'Free' Money

If there is only ONE thing you can be sure of and bet your life on, it's this:

THERE IS NO FREE LUNCH.

That's right. EVERYTHING has a cost associated with it. Even stuff that is 'free' to you has a cost, even though you may not have had to pay anything for it.

If I buy you a newspaper, it still cost something. Namely, 50 cents out of my pocket.
If you're going to read it, it's going to cost you something as well. Namely, not watching the tv for the next 20 minutes.

THERE IS NO FREE LUNCH.

Moving on...

Just passed in Washington D.C. was the much-hyped 'Economic Stimulus' package. In an attempt to 'jump start' the 'slowing' economy, our lovely politicians have decided to send most people in this country 3oo or 600 dollars. Free and clear!

Except there's a problem: THERE IS NO FREE LUNCH.

Where does the government 'get' the money it's going to send you?

There are 3 ways that happens.

First, government could simply print more money! But that leads to inflation.
(Simple explanation)

Government can tax us. Of course, raising taxes means that the money comes from someone and then given to another. If your long, lost uncle left you and your brother each $50,000 dollars, it is ridiculous to think that your brother would actually only get $10,000 dollars more than you if it were divided 60/40.

Finally, the government can borrow the money. Going back to the long, lost uncle analogy, imagine the same uncle borrowing $600 dollars from the bank, giving it to you and then dying... leaving you to pay back the $600 (with interest) to the bank.

Don't get too excited about the 'free' money you'll get in May. Sure, it's nice. But it's far from free.