
I'm not a big bank, nor a wall street type. I'm not a homeowner, or a person foreclosed. I'm a member of what we would call the middle-class, struggling to get by. Fact is, unless you're rich, you're living paycheque to paycheque, just like everybody else. Meanwhile, you sit back and watch helplessly as congress debates how much money to give to the banks to stimulate the economy. 700,000,000,000.00 dollars. SEVEN HUNDRED BILLION dollars that will come off the backs of the taxpayer.
Lets go into why I'm living paycheque to paycheque.
I spend:
$400 dollars/month to send one kid to school
$500-700 / month for daycare for the other
$360.00 per month on one credit card
$200.00 per month on the other
$1020.00 per month on rent
$350.00 per month on a car payment
then there's groceries, car insurance, life insurance, and other miscellaneous expenses.
There are 144,354,117 (est. 2008; CIA) people between the ages of 16 and 49 in the United States. If we assume that two-thirds of those people are married and do or do not have kids, that gives us 96,717,259 married people aged 18-49. This in turn translates to 48,358,630 couples. If we divide $700,000,000,000.00 by 48,358,630. That turns out to be $14,475.18 per couple.
Now, what would $14,475.18 do for someone like me? It would pay off my credit cards, saving me approximately $560.00 per month, or 6,720.00 per year. Did I mention my second car just died?
Now, let's say I have a home loan that I can't afford because... oh... my credit cards are maxed out... or I have car payments on top of it, or I have other loans. An extra $500-600 per month may be enough to keep me in my home, or to allow me to downgrade to a smaller home while somebody who is now more able to pay can buy up my property.
Now, there's always the problem that people are going to take that money and blow it all on liquor, guns, and cheap hookers, but in the end, it's their own money anyways (being a taxpayer). However, I see that percentage of people being very small, with the more responsible people using it to pay off debt or to invest for their futures or their children's futures.
Regardless, you are pumping money back into the financial sector, just indirectly, by issuing a refund. That money will find it's way back into the banks and into wall street and would unclog the credit markets by allowing people to afford to pay for their loans.
Aha! You say. But what about the people over the age of 50. Frankly, the boomers are all reaching retirement age and are about to drain social security so there will be no money left for the younger generations. Persons over the age of 50 are also more established in society, they own their homes, have a couple of vehicles they own, their kids have moved out... in essence, they have fewer expenses.
This could be expanded to persons who are unmarried, with children, or who are aged 50-60, provided you establish a system where persons over a certain income level do not receive the entire benefit or any at all dependant on income.
At any rate, I'll go back home tonight and dine on Kraft Dinner and Hot Pockets, while big bankers and CEOs can go home to their mansions in their Ferarris and have their chefs prepare lobster and filet mignon.
Just a thought.
Labels: $700 Billion, Bailout, Middle-class, US economy