Will Consumers Spend?

It appears that Republicans are tending toward a cut of personal income tax rather than accelerating asset write-offs as President Obama has proposed. The principle is essentially the same; a tax cut to stimulate personal spending or a tax cut to stimulate investment.

Those who favor a tax cuts to accelerate personal spending assume that the money will be spent. I think consumers are still going through the deleveraging process. Recent surveys show that even those with money are reluctant to spend vs saving or paying down debt.