How does the government hope people will use their tax rebate checks?
The government is hoping that a high fraction of the tax rebate checks will be used by recipients to buy needed goods and services, and that this spending will increase demand in a way that stimulates the economy, increases output, and decreases unemployment. But I don’t think that the government is assuming all individuals ought to spend their money that way. Different people have different needs, and some may need to save that money for college tuition, for a new house, or for retirement. Hopefully each person can use the money for their own needs in a way that raises everybody’s well being. If people use the rebate that way, is it likely to impact the economy? If enough people do choose to spend it now on goods and services produced in the U.S., and that increases U.S. production, then we might avoid a recession or at least avoid a very damaging recession. On the other hand, I don’t think that even this tax rebate is enough to ensure a favorable outcome. It might help, but it cannot
