George Will on the

George Will on the president’s economic plan (after reading Will’s piece, I won’t call it a stimulus package). According to Will, the plan’s primary purpose is long-term structural change, rather than changes in short-term conditions. Will notes that the current system of double taxation of dividends “in effect subsidizes corporate financing by debt rather than equity, because interest is deductible and dividends are not.” However, Will argues that the stimulative effect of President Bush’s proposal to eliminate taxation of individual’s dividend income is limited because half of all dividends go to 401(k)s, pension funds, and other untaxed accounts. Thus, says Will, it would be better to cure double taxation by allowing corporations to expense dividends against income.