How about this for a stimulus bill?
I have an idea for a new stimulus plan.. It may be stupid, but I’m just a guy with a high school education so there are undoubtedly things I didn’t think about.
1. Reclaim 100% (With interest) of the money that was paid during the bailout from the banks and automotive manufacturers.
-Based on the census numbers from 1996 (it was as current as I could find), it was estimated there would be 114 million households in 2010. So, in the interest of estimating high, I’ll say there are 120 million now. http://www.census.gov/prod/1/pop/p25-1129.pdf
2. Take the money reclaimed and create a one-time credit of 0,000 per HOUSEHOLD of taxpayers and dependents. Yes, I understand that this would equal Trillion.
-Each household would mean that even though there may be 3 or more actual taxpayers in the household, the credit would be for that single residence.
-The determination would be based on current physical address that must be verified by proof of recent bank accounts and bills…. we all know the drill.
-This credit would not be issued as a tax credit or cash. It would have to be filed as a claim to a state office where all of the documentation is reviewed and processed. (This could create temp jobs too.)
The credit would be used only to pay off EXISTING credit accounts, car loans, mortgage payments, and other outstanding debt held by members of the household.
-The credit would be equally divided among members of the household or however the members of the household agree. Only ONE claim package will be accepted per household and if multiple are found, then it will be set aside for assessment.
-Should the household not need all 0k, the remaining may be applied to the purchase of a home or split equally among the members of the household and put in their social security fund. Members of the household will not be required to use the full 0k.
-Claims for credit used to purchase a new home must be spent on a home that is on a foreclosure listing and must be used as a primary residence of at least one member of the household for no less than 5 years. Member must be 18 years of age or older and a taxpayer.
3. Members of a household submit a claim for this credit must agree to forfeit any Federal Tax Refunds for the term of 10 years, or until the amount of cummulitive refunds forfeited excedes the amount credited. Whichever happens first.
-Members of a household that make a claim will not be entitled to Earned Income Credit during any year that a refund is forfeited.
-Members that move from one household to another will still be required to fulfill the tax liability agreed to at the time the credit is issued.
-Itemized deductions, and standard tax credits will still be allowed when filing taxes to determine whether or not taxes are due.
There’s a lot more that can be included as this is just the basic idea. The details could be hashed out later.
I believe that even though there will be fraud with a program like this, it will still accomplish the following:
1. Taxpayers will be able to free themselves of excessive debts.
2. Financial institutions will not falter as they will receive the money used to pay off the debts without significant government regulation, but will have to understand that they will be allowed to fail later.
3. The national debt will be reduced in a more timely manner without significant hardships placed on taxpayers. Furthermore, there will be less need for tax increases once the number of refunds has been reduced to a smaller percentage.
I’m not sure that this idea is great, but it was just an idea and I’d like to see what people really think about. So, how about it???
Thank you all so far for your inputs. Like I said, I’m a guy with a high school education, not a master in finance or anything and this was just a thought.
To be more detailed about the tax repayment part, as an example, my family received approximately k last year in tax refunds that was OVER what we actually paid. (Not that I minded Uncle Sam handing us the money) I actually had to ask our tax preparer to get a supervisor to recheck the numbers because our refund equalled just over k between state and federal. My wife and I had total income of just over k the year before. So, that being the case, how many other families received just as much in refunds last year? With my idea, NOBODY will get refunded more than paid into taxes even if they don’t take the 0k.
Part II
So, subtract 50% from the total population of the US,http://www.census.gov/population/www/popclockus.html, Multiply that by 0 and then Multiply that again by 10 years…
Dividing the population by 50% is just by uneducated estimate of non-tax paying persons that include children, illegal immigrants, and persons that would get nearly everything back in taxes.
The purpose of a program like this would be 1. Clear consumer debt without killing the companies that own the debt. 2. Give conusmers the ability to spend more on things that they need. And 3. Create a handful a jobs.
Yes, there will be fraud. But no worse than there is right now.
If the banks and everyone have paid off the loans we gave them… well, then this idea is completely dead anyway.
Again, thanks for the input. I’m definately not an economist so I was sure there was going to be a lot of "holes" in this idea.