A different take on the bailout

[triam]

I’m against the $85,000,000,000.00 bailout of AIG. Instead, I’m in favor of giving $85,000,000,000 to America in a ‘We Deserve It Dividend’. To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+. Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up. So divide 200 million adults 18+ into $85 billon that equals $425,000.00. My plan is to give $425,000 to every person 18+ as a ‘We Deserve It Dividend’. Of course, it would NOT be tax free. So let’s assume a tax rate of 30%. Every individual 18+ has to pay $127,500.00 in taxes. That sends $25,500,000,000 right back to Uncle Sam. But it means that every adult 18+ has $297,500.00 in their pocket. A husband and wife have $595,000.00. What would you do with $297,500.00 to $595,000.00 in your family? Pay off your mortgage - housing crisis solved. Repay college loans - what a great boost to new grads Put away money for college - it’ll be there Save in a bank - create money to loan to entrepreneurs. Buy a new car - create jobs Invest in the market - capital drives growth Pay for your parent’s medical insurance - health care improves Enable Deadbeat Dads to come clean - or else Remember this is for every adult U S Citizen 18+ including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back, and of course, for those serving in our Armed Forces. If we’re going to re-distribute wealth let’s really do it...instead of trickling out a puny $1000.00 ( “vote buy†) economic incentive that is being proposed by one of our candidates for President. If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+! As for AIG - liquidate it. Sell off its parts. Let American General go back to being American General. Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up. Here’s my rationale. We deserve it and AIG doesn’t. Sure it’s a crazy idea that can “never work.†But can you imagine the Coast-To-Coast Block Party! How do you spell Economic Boom? I trust my fellow adult Americans to know how to use the $85 Billion ‘We Deserve It Dividend’ more than I do the geniuses at AIG or in Washington DC. And remember, The Family plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam. Talk about a stimulus package!

this is from one of the blogs I frequent, sounds a very interesting idea, thots?

[THX_1138]

AIG is not receiving a bailout... they have requested a short term, emmergency loan to address their liquidity concerns. AIG intends to repay the amount lent to them in a period less than 5 years by selling numerous assets. On the other hand, i dont favor the bailout one bit... lets use the free market solution. The risky securities should be sold to the highest bidder (which is most likely going to be some foreign bank, or local banks propped up by foreign funds such as Citi Bank), after reevaluation of the mortgages (i.e. adjusting them to the actual cost of the underlying asset). The problem with that is that Americans are quite averse to the idea of free market when it means that their nation will become property of another foreign interest... lets not for a moment discuss how there is little hesitation when the shoe is on the other foot...

[triam]

I am all for free market solutions, you ride with the bumps, and get over it. I just found the above article kind of interesting.

[kablooee87]

I think whoever suggested that doesn't quite understand how things actually work.

[triam]

That may be true kabloee, what part of that is so outrageous as opposed to what is happening now?

[THX_1138]

That may be true kabloee' date=' what part of that is so outrageous as opposed to what is happening now?[/quote'] well this person understands little if anything about the movement of the money markets. If the government gives about 300K to every individual, the money cannot come out of thing air... it has to be printed. I.e. the government has to print the above 85Billion dollars for distribution. Hence, as the supply of money goes up, the LM curve in the IS-LM graph shifts to the right or rather shifts down... this momentarily lowers interests rates, but also increases income (as would be when everyone receives 300K, thus increased income, and less incentive to take out a loan as you already have all the money you need); moreover, with increased personal income, people start purchasing, driving up demand, and as a result, till the time the supply can catch up, inflation goes through the roof. the whole idea of giving people a handout is to stimulate consumption, but the exact opposite would happen here... people would use the handout to pay off outstanding debts, and drive the inflation rate into the stratosphere. i understand that a number of people here are enthusiastic about their own personal ideas of how to fix the economic crisis, but if it was indeed so bloody fundamental and lucid, it would already have been done so far. lets leave such talk for uneducated, rhetoric toting radio talk show hosts who understanding of the economics is that it is starts with an E.

[THX_1138]

That may be true kabloee' date=' what part of that is so outrageous as opposed to what is happening now?[/quote'] if this insane individual thinks that handing out cash to the folks is a good idea, then all he/she must do is look at Zimbabwe where a crazed, megalomaniac idiot is printing cash faster than i can say "nice rack"... and driving his nation's inflation upwards of 28000%. furthermore, there are notable examples from history of how unsuccessful such a policy is: post WWI germany was penalized for its belligerence by being made to pay a ghoulish 6 Billion in reparations to the victors of the war. at the same time, to stimulate german economy, just so that it could manufacture goods and thus gain the ability to pay that 6 billion debt, united states and some other allies pumped money into germany. instead of utilizing that cash to make industry, the germans simply used the money to pay off the debt... as a result, driving the german economy into a tremendous recession with inflation rates so high that people would burn money as fuel as it would be more cost effective than purchasing fuel.

[Dhondy]

I’m against the $85,000,000,000.00 bailout of AIG. Instead, I’m in favor of giving $85,000,000,000 to America in a ‘We Deserve It Dividend’. To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+. Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up. So divide 200 million adults 18+ into $85 billon that equals $425,000.00. My plan is to give $425,000 to every person 18+ as a ‘We Deserve It Dividend’. Of course, it would NOT be tax free. So let’s assume a tax rate of 30%. Every individual 18+ has to pay $127,500.00 in taxes. That sends $25,500,000,000 right back to Uncle Sam. But it means that every adult 18+ has $297,500.00 in their pocket. A husband and wife have $595,000.00. What would you do with $297,500.00 to $595,000.00 in your family? Pay off your mortgage - housing crisis solved. Repay college loans - what a great boost to new grads Put away money for college - it’ll be there Save in a bank - create money to loan to entrepreneurs. Buy a new car - create jobs Invest in the market - capital drives growth Pay for your parent’s medical insurance - health care improves Enable Deadbeat Dads to come clean - or else Remember this is for every adult U S Citizen 18+ including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back, and of course, for those serving in our Armed Forces. If we’re going to re-distribute wealth let’s really do it...instead of trickling out a puny $1000.00 ( “vote buy” ) economic incentive that is being proposed by one of our candidates for President. If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+! As for AIG - liquidate it. Sell off its parts. Let American General go back to being American General. Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up. Here’s my rationale. We deserve it and AIG doesn’t. Sure it’s a crazy idea that can “never work.” But can you imagine the Coast-To-Coast Block Party! How do you spell Economic Boom? I trust my fellow adult Americans to know how to use the $85 Billion ‘We Deserve It Dividend’ more than I do the geniuses at AIG or in Washington DC. And remember, The Family plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam. Talk about a stimulus package!

There's just one little problem with that suggestion. 85 billion, divided into 200 million folks works out at 425 bucks per hombre, and not the princely $425 K that the blogger is dreaming of. No wonder the American consumer is in trouble.

[THX_1138]

There's just one little problem with that suggestion. 85 billion, divided into 200 million folks works out at 425 bucks per hombre, and not the princely $425 K that the blogger is dreaming of. No wonder the American consumer is in trouble.

lol... should have verified that myself!

[fineleg]

triam, which blog is this? can u post a link?

[kablooee87]

I also found the title hilarious, the "We Deserve It Dividend." What exactly has every American done to deserve such a paycheck?

[jf1gp_1]

So divide 200 million adults 18+ into $85 billon that equals $425,000.00. this is from one of the blogs I frequent, sounds a very interesting idea, thots?

i suggest few fundamental math lessons before suggesting any economic policy

[triam]

prempanicker.com is the blog. hahaha I should have checked the math before

[fineleg]

prempanicker.com is the blog. hahaha I should have checked the math before

oh, prem - i used to visit that sometime ago.

[Holysmoke]

There's just one little problem with that suggestion. 85 billion, divided into 200 million folks works out at 425 bucks per hombre, and not the princely $425 K that the blogger is dreaming of. No wonder the American consumer is in trouble.

Hahaha.. owned 'im