The cost, benefits, and implication of cash handout programs

[webfact]

Government cash handout programs, widely adopted as a quick response to economic downturns and crises like the COVID-19 pandemic, have spurred much debate regarding their effectiveness as a stimulus. While these programs inject immediate liquidity into the economy and aid those in dire need, their long-term efficacy in stimulating sustainable economic growth remains questionable, as evidenced by various real-world examples.

 

One of the primary issues with such handouts is their temporary nature. 

 

Immediate Impact vs. Long-Term Effectiveness

 

The primary appeal of cash handout programs is their ability to provide immediate financial assistance to those in need, particularly during unforeseen crises like the COVID-19 pandemic. For instance, the United States, under the Trump administration, executed payments totaling $931 billion to mitigate the economic impact of the pandemic. These payments, part of larger stimulus packages, aimed to alleviate the financial burden on individuals and families, thereby boosting consumer spending and, in theory, stimulating the economy.

 

However, the effectiveness of these programs in creating sustainable economic growth is less clear. While they inject liquidity into the economy, leading to a short-term increase in consumer spending, this does not necessarily translate into long-term economic benefits. In many cases, these handouts are used to cover immediate expenses and do not contribute to productive investment or economic growth.

 

By Arun Saronchai

 

Full story: THA ENQUIRER 2024-01-17

 

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[worgeordie]

It was used as a vote buying strategy , the money borrowed will take years to repay,

and it will increase inflation , it will be subject to "shrinkage" ...

 

regards worgeordie

[Tropicalevo]

Back to the old saying -

Give a man a fish and he eats for a day..........

 

It was vote buying in the simplest terms.

[bamnutsak]

1 hour ago, webfact said:

widely adopted as a quick response

 

In the case of Thailand, it was quickly presented to the Thai electorate by PTP.

 

However, the enactment seems to have reverted to Thai (glacial) Time.

 

 

IMO, the Constitutional Court should have a case presented to them regarding PTP's ILLEGAL vote-buying actions.

 

 

Possibly owning shares in a long-defunct "media" group, and/or proposing changes to the Consitution, are far less serious charges.

 

 

 

 

[huangnon]

Shut down small, medium, and even large (unconnected) businesses with Draconian BS C-19 lockdowns, so your corporate giant friends scoop them up for peanuts.

Create dependency (control) on the Government for handouts for the people left unemployed.

[jvs]

Not only vote buying but the only people profiting will be the large companies.

Giving cash to needy people directly is much better.

You will need an app to get the money?

People who really need it don't even have a phone!

 

[tomazbodner]

51 minutes ago, jvs said:

People who really need it don't even have a phone!

That was the point.

[Emdog]

The example of the US during pandemic has no relation to this vote buying scheme. The closest would be the trillion dollar tax cut given to the wealthy and corporations that did not need it. Sort of a "thank you" package. Similar to here in many ways

[smedly]

3 hours ago, webfact said:

Government cash handout programs

called benefits in western countries, Thailand is struggling with a one time payment ?

 

can you imagine a welfare system in Thailand - very deep pockets needed for that

[sathornlover]

3 hours ago, worgeordie said:

It was used as a vote buying strategy , the money borrowed will take years to repay,

and it will increase inflation , it will be subject to "shrinkage" ...

 

regards worgeordie

I can only agree with this wholeheartedly and it sums up the impact of vote buying under the guise of a “digital wallet”: Immediate Impact vs. Long-Term Effectiveness …

[TheAppletons]

3 hours ago, Tropicalevo said:

Back to the old saying -

Give a man a fish and he eats for a day..........

 

 

.....teach a man to fish and you can sell him a boatload of accessories.

[ChaiyaTH]

Money always end up with the rich, that is why they never object to printing cash, which this is too. The 'normal people' also rarely object, they think it is amazing. They just do not realize they will simply pay it back by higher taxes and inflation in return.

 

This is exactly where bitcoin is the opposite, there can never be printed more bitcoin than exists. That is why it will only increase in value over time. Mind you with the BTC left available, if the whole global population wanted a bit, there would only be around 0.0003 BTC per person left. With other words it is enough to even just buy 100 dollars today, to see 10-20K in a decade or 2 at most.

[sirineou]

A lot of nonsense above as it pertains to the subject matter of the OP. 

A stimulus is classic economic device often used by governments to stimulate a lagging economy. 

Money paid to citizens generates consumption, and what better way to infuse those funds in an economy , that to give it to the poor  who would spend all of it. The multiplier affects. 

I send 100 bht at the shoe maker , and taxes are collected, the shoe maker spends the 100 bht buying supplies and food at the butcher and collects taxes, , the butcher spends  that 100 bht to buy more meat  to sell and flowers for his wife etc etc etc. The money circulates many times through the economy, and the goverment gets back the original stimulus in taxes collected. .  

 

[hotchilli]

5 hours ago, worgeordie said:

It was used as a vote buying strategy , the money borrowed will take years to repay,

and it will increase inflation , it will be subject to "shrinkage" ...

 

regards worgeordie

Thailand is ell versed in understanding shrinkage.

[john donson]

so next elections, if a party offers 100k, to buy the vote, it will be ok ? bribery and they did not win the elections, only with backstabbing coalitions for the man that probably is sitting in his penthouse that cannot be visited in a hospital because he ain't there...

[new2here]

To me there’s a few ways you could go.

 

Clearly a straight cash handout is the most desired, but the government looses their ability to target where those funds go 

 

So.. they could give vouchers that can only be redeemed against X, Y or Z purchases and can’t be banked/saved (as saving doesn’t drive immediate economic activity) nor used by anyone else (ie non-transferable) 

 

if the worry is that only a handful of larger corporations will benefit, then implement redemption caps both in aggregate as well as geographic.  So a large entity can accept them but only up to X value, after that other smaller entities would be beneficiaries.

 

to help multiple industries, you could also make X% of a person's total voucher value redeemable for Y type goods and another percentage redeemable for Z type goods 

 

 

[Bday Prang]

6 hours ago, Tropicalevo said:

Give a man a fish and he eats for a day..........

Give a scouser a fishing rod and he'll poke it through your letter box , hook up your car keys and steal your car 

[Yellowtail]

3 hours ago, sirineou said:

A lot of nonsense above as it pertains to the subject matter of the OP. 

A stimulus is classic economic device often used by governments to stimulate a lagging economy. 

Money paid to citizens generates consumption, and what better way to infuse those funds in an economy , that to give it to the poor  who would spend all of it. The multiplier affects. 

I send 100 bht at the shoe maker , and taxes are collected, the shoe maker spends the 100 bht buying supplies and food at the butcher and collects taxes, , the butcher spends  that 100 bht to buy more meat  to sell and flowers for his wife etc etc etc. The money circulates many times through the economy, and the goverment gets back the original stimulus in taxes collected. .  

 

Trickle down economics.

[PETERTHEEATER]

6 hours ago, Tropicalevo said:

Back to the old saying -

Give a man a fish and he eats for a day..........

 

It was vote buying in the simplest terms.

You didn't finish 'the old saying'

 

Give a man a fish and he eats for a day,

Give a man a fishing rod and he will smash it up to fuel a fire to cook the fish.....😀

[Yellowtail]

Just now, PETERTHEEATER said:

You didn't finish 'the old saying'

 

Give a man a fish and he eats for a day,

Give a man a fishing rod and he will smash it up to fuel a fire to cook the fish.....😀

Give a man a fish, and he'll be back tomorrow for another, and after a while, you owe him the fish every day, and woe unto you if he doesn't get it. 

 

After a while, he tires of fish...

[couchpotato]

23 minutes ago, Bday Prang said:

Give a scouser a fishing rod and he'll poke it through your letter box , hook up your car keys and steal your car 

Not just scousers, probably most englishmen

[Eric Loh]

6 hours ago, jvs said:

Not only vote buying but the only people profiting will be the large companies.

Giving cash to needy people directly is much better.

You will need an app to get the money?

People who really need it don't even have a phone!

 

 

I can't state catergorically that all Thais have mobile phone but there are 126.41 million mobile phones actvely connected which averages to 1.8 mobile phones per person. 

 

All parties campaigned with promises of stimulus packages to win over the voters. 

 

 

[DonniePeverley]

Is this why they have opened the borders for everyone and their dogs ? 

[Eric Loh]

29 minutes ago, Yellowtail said:

Trickle down economics.

Trickle down is when you cut tax & regulations for the corporations and wealthy and they spend more and trickle down to the people. This is more a multiplier generated by spending numerous times. In my opinion, the cash handout programs should not only be targeted but in tranches rolled out in 3 years to lessen the debt problem and to evaluate the effectiveness.

[Bday Prang]

1 hour ago, Eric Loh said:

 

I can't state catergorically that all Thais have mobile phone but there are 126.41 million mobile phones actvely connected which averages to 1.8 mobile phones per person. 

 

All parties campaigned with promises of stimulus packages to win over the voters. 

 

 

even out here in the outback of darkest Surin there are very few over 7 years old that don't have their own  (smart) phone

[ChaiyaTH]

12 hours ago, ChaiyaTH said:

Money always end up with the rich, that is why they never object to printing cash, which this is too. The 'normal people' also rarely object, they think it is amazing. They just do not realize they will simply pay it back by higher taxes and inflation in return.

 

This is exactly where bitcoin is the opposite, there can never be printed more bitcoin than exists. That is why it will only increase in value over time. Mind you with the BTC left available, if the whole global population wanted a bit, there would only be around 0.0003 BTC per person left. With other words it is enough to even just buy 100 dollars today, to see 10-20K in a decade or 2 at most.

Funny how few got the point, explains it all. Hence few are rich amongst us all.

 

Fun somehow to make fun of what does not know or understand while pretending life was a pleasure working 40 years for a cheat off pension.

 

I could only wish to live in some remote place and never be aware, of how much i would been <deleted> over, in that case.

[sirineou]

13 hours ago, Yellowtail said:

Trickle down economics.

You have not been paying attention.

Say 10 hail Marys and wash your mouth with soap. 

it is Exactly the opposite .