On the advice of the intelligent, thoughtful bloggers here I went back and did some fine tuning of an idea I have to bail out America. So, I'm back today to run it past you on DKOS again. Like it or hate it, at least it's a plan that hasn't been cooked up by some "economic advisor" or federal lackey.
This idea is based upon a little theory used by a guy named Keynes. Keynes was an economist during the Great Depression who advocated for government spending on public works projects to get the nation out of its economic turmoil. Keynes famously suggested that paying people to do nothing but dig ditches and fill them in again would boost the economy because they could at least put wages back into the system. FDR put the notion into play, and it worked. Bush then applied it to Iraq (badly) and it hasn't stopped yet.
One of the most gaping "holes" created by the Bush Administration is, of course, the war in Iraq. It's a bottomless pit, sucking funds from everywhere. In 2001 Rumsfeld reported that over $2.3 TRILLION had "disappeared" from the Department of Defense, never to be found. Some or most may have been part of the "payola" given away in chunks of thousands of dollars to Iraqi civilians and small businesses in the Green Zone. We know it never went for buildings or real reconstruction. This has been Iraqi Keynesism a la George W.: the hole to nowhere.
While digging holes to nowhere in Iraq is as idiotic as it gets, the fundamental principles of Keynes actually worked in the Depression. So let's put them to work again, like this:
To the 120,000,000 Americans (rounded up to exclude the 15-18 year old age group and cover the increased job losses) on SSDI/SSI/unemployment/and those working at jobs paying less than $150,000 per year, they will receive from a non-porked, direct stimulus bill the sum of $10,000 every 6 months for 4 years. The program will then sunset. That is an additional $20K per year for American citizens (required), who are not dependents (kids) or incarcerated.
Let's do the math: $20K X 120 million (census data) eligible = $2.4 trillion per year. One billion less than the money that vanished under Rumsfeld's nose.
Now, converting all that pork in the present bail out package to dollars going to the American people, we have an amount that is pretty close to the figure being demanded right now. And WHAT WON'T Americans be able to do with an extra $20,000 per year/$10K paid once every six months for those 4 years?? How about get out from under credit card debt? How about catching up on mortgages that are required to be refinanced? How about buy a new car and bail out Detroit while making them compete for our money like Wal Mart does with Target?
Yep, you keep the cash tax-free, and spend it however you want. You keep your job or your business. Retiree's and the disabled will keep their pensions or SSDI/SSI, raising them over the threshold of the Food Stamp program and TANF, which can be cut. Gotta keep Medicaid/Medicare in place and continue to work on universal health coverage through a single payer system, but that has already been budgeted.
HOW: You cut the Iraq war budget to bare bones, if any, and bring the troops home. You go after the major contractors who have used fraud and graft to enrich themselves on government funds, like Black Water, Halliburton, and other Bush cronies still operating. Stop the Payola to the Iraqis. Stop the contracts, recover the money by freezing assets and replenish the Treasury. Same for every entity that has received those September bail out funds and took vacations, redecorated offices, and anything else that was not the intent for its use. You also go back and RAISE taxes for the big, greedy profiteers like Exxon (resurrect the old Civil War carpetbaggers statutes and windfall profits taxes) and that group making more than $250,000 a year, and eliminate those CEO bonuses and parachutes by taxing the hell out of them and capitating what can be held in a "retirement" account anywhere, including off-shore. Hide the money- pay the price.
WHAT'S THE CATCH? Well, no voluntary quits from present employment or closing a business that could survive otherwise. Since the money is already the property of the American taxpayer through taxes, then the $20K a year is tax-exempt, EXCEPT if you voluntarily quit work or prematurely close shop. Then the IRS will tax you for the whole $80,000 that you would have been eligible to receive.
There must be a provision for going after the states, too. There is an unbelievable amount of money that every state has received for target programs. However, the programs rarely use all the funds, and the states, like mine (Colorado), have this habit of squirreling away millions, and "losing" even more by "loaning" to other state programs. That is patently illegal and entirely recoverable by the Treasury. Three years ago, my state "lost" over $20 million in funds for the Low Income Energy Assistance Program. It's 100% federally funded, but the feds never asked for it back; not even after a judge proved it to them. How much more do you think has gone missing down state rat holes, eh? Is your state still receiving "refugee funds" for Katrina and earlier disasters? Mine is.
FINALLY: FREEZE EVERYTHING from wages to fuel prices. NOTHING, including the price of a loaf of bread, will be allowed to increase for the first 2 years. Fuel prices will have their clocks turned back by at least 10 years, and forced to stay there. Federal, state and local sales taxes cannot increase either, unless it has been provided for by an earlier statute that cannot be excepted. Without the freeze, greed will overwhelm the profiteers and they will ruin the benefit of that $20K per year to the eligible. It would add to the poverty rate as well and skew the measurements of success or failure. A tough "catch" but a fair one.
The way to fund this and everything else we need to recover our economy is FIND THE MONEY that's been there all along, and bail out the Americans described above. It's simple Robin Hood theory: tax the rich/give to the poor. Equalize the nation over 4 years. Let DOJ go after everyone the GAO finds padding their contracts. Measure how well or poorly this plan is working in 2 years with Census statistics. Doing well or not, it ends in 2013 - exactly on the date the program started. Census and the IRS have all the necessary information to allow Americans to participate in the plan immediately. No late-comers either. As of January 1, 2009 you meet the criteria or you don't.
Anyway, that's my suggestion to the Blogosphere and President Obama. If you like it, crosspost it to the Blogosphere. Perhaps it will be heard. If you hate it, say why. However, stop overlooking the obvious solutions. Everything necessary to make this work is already in place, including the criminal statutes for the greedy.
With all due respect Mr. President, we need a Robin Hood not a Sheriff of Nottingham.
dogsoldier1
"Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius -- and a lot of courage -- to move in the opposite direction." ...Albert Einstein