Leaders in Washington are figuring out how to stimulate the economy. Here's my simple plan: suspend the payroll tax for three months, both the employer and employee portion.
Suspending the payroll tax will put money in the pockets of working people, quickly! There will be no waiting on the Treasury to cut and mail checks over several months. Suspending the employer portion would put money into small businesses, allowing them to invest.
Surely this will make the deficit worse in the short term, but no worse than the stimulus checks of earlier this year.
In order to prevent the shock at the end of the three-month period, I propose also that we phase the payroll tax back in over three or four months.