The rebate debate: food or flat screen

Fill the gas tank or stock up on Top Ramen?

There are many ways to spend those government rebates that began going out this week. With the cost of living soaring like Superman, consumers are likely to spend this extra cash on necessities, not on flat-screen television or iPhones — the kind of retail purchases that our beloved elected officials had hoped would stimulate the economy.

Many people will spend the rebates just to make ends meet. For them, the checks of up to $1,200 per couple (and an additional $300 per child) couldn’t come at a better time, especially now that a gallon of gas costs as much as a Happy Meal at McDonalds.

The AAA auto club says the average price of a gallon of gasoline in Washington is a record-high $3.73.

That’s up 25 cents in the past month, and it’s 43 cents higher than a year ago. It’s also 11 cents higher than the national average.

The numbers are just as bleak at the supermarket checkout counter. The cost of milk has risen more than 25 percent in the past year; the price of eggs are 40 percent higher. Food accounts for about 13 percent of the typical household’s spending.

Then there’s the housing crisis, which has reduced homeowners’ real wealth and limited their ability to obtain credit. Wages, meanwhile, are not keeping pace.

Checks for $1,200 per couple won’t come close to solving these problems. But they will help many families with their monthly bills, or to pay down a credit card.

That’s welcome relief for consumers in the short term. Some will save what they can, fearing this rough patch isn’t over.

Long range, however, this infusion of cash for low- and middle-income taxpayers probably isn’t going to shorten a recession, or what feels like one.

The more people spend on necessities such as food and gas, the less impact the rebates will have on stimulating an economic recovery.

While a 42-inch LCD television sounds good, shrimp-flavored Top Ramen may be the smart choice.

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