The Senate seems to have agreed on a deal for a stimulus package that would send more than $100 billion in cash (checks of $600 to individuals making less than $75,000 and $1,200 to families making less than $150,000) to American taxpayers later this spring. And not a moment too soon. Falling employment, slowing growth, and terrible January retail sales indicate a serious slowdown is upon us. Even Wall Street economists, typically the last to notice a recession coming, have seen the dark.

The theory behind the rebates is that American taxpayers, being Americans, will take the $100-plus billion, and spend it-stat!--thus providing a jolt of stimulus to the economy.

But will they? A survey that arrived in my inbox from American Century Investments found that only 27 percent would spend the rebate right away, while 36 percent would use the cash to pay down debt and 25 percent would save or invest it. Of course, surveys document intentions rather than actions. But if the folks in the survey are true to their word, the stimulus will be less than stimulating. Putting a few hundred bucks in a certificate of deposit, or in a mutual fund that invests in Indian stocks, or paying down your home equity line of credit won't do much to help the proprietor of a local boutique, or Wal-Mart.

http://www.newsweek.com/id/109042