I recently received this email from one of those serial email friends:
There recently was an article in the St. Petersburg , Florida Times. The Business Section asked readers for ideas on: “How Would You Fix the Economy?” I think this guy nailed it!
Dear Mr. President,
Please find below my suggestion for fixing America ’s economy. Instead of giving billions of dollars to companies that will squander the money on lavish parties and unearned bonuses, spend a measly $40 billion using the following plan.
You can call it the “Patriotic Retirement Plan”:
There are about 40 million people over 50 in the work force. Pay them $1 million apiece severance for early retirement with the following stipulations:
1) They MUST retire. Forty million job openings – Unemployment fixed.
2) They MUST buy a new AMERICAN Car. Forty million cars ordered – Auto Industry fixed.
3) They MUST either buy a house or pay off their mortgage – Housing Crisis fixed.
It can’t get any easier than that!!
P.S. If more money is needed, have all members in Congress pay their taxes..
Mr. President, while you’re at it, make Congress retire on Social Security and Medicare. I’ll bet both programs would be fixed pronto!
Wow. Funny how something can look good at first glance but then math and logic catches up. Perhaps my friend’s enthusiasm was due to his being over 50?
My first thought: 40,000,000 x $1,000,000 is $40 TRILLION dollars, not $40 billion. With the US in debt to the tune of $14 trillion already, where is this money supposed to come from? Congress couldn’t generate enough taxes if we took ALL of their income.
Oh, we can just print the cash … right? No, not really. With a sudden influx of $40 trillion dollars (read How Much Is A Trillion, the amount of inflation that would instantly hit the economy would be devastating, crippling, and shattering. NO ONE would continue to sell anything for the same price when so many people had so much cash available to them. Inflation is technically an increase in the money supply – rising prices is only the result of that money supply increase but that’s what people see. If we injected $40 trillion into the economy, we would experience and immense swing in prices up, followed by a devastating crash back to earth after all that cash was spent … and no one needed a new car or new home for several years.
My second thought is … FORCED retirement on people over the age of 50? FORCED? What kind of “free country” is THAT? Also, is there any reason to believe that ALL 40 million people over 50 are employed and that there are 40 million more (young) people readily trained and willing to take their positions? I’m guessing the author was under 30 … or less. His logic sounds like he’s about 8 years old.
Thirdly, they MUST buy an American car? What about Honda, Hyundai, or Mercedes (all made in Alabama). What about BMW (made in Spartanburg, SC)? What about all the other “foreign” car companies that employ thousands of Americans in plants on US soil? Do we have to buy the Ford, GMC, or Chrysler products that have the majority of their parts made in Mexico or Canada? And didn’t we learn anything at all from the failure of the Cash for Clunkers program?
Next, they MUST buy a home or pay off their mortgage? What if they don’t want to move and have already paid off their home? Do they have to pay off their neighbor’s home? And retire? And buy an “American” made car? With only ONE million dollars? Hahaha!
Obviously the loony-toon guy that thought this up was occupying something and I’m thinking it was a crack house.
If you want some REALLY good advice that makes sense, check out this week’s links from my friends in the Personal Finance Blogosphere:
- How Warren Buffet’s Tax Rate Is Lower Than His Secretary’s
- How to Use Dollar Cost Averaging to Max Out Your Roth IRA Contributions
- How To Create A Personal Budget
- 2012 Roth IRA Rules Changes
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- 4 Crucial Tips To Help You Save For Your Next Car Purchase
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- Changes To The Federal Student Loan Income Based Repayment Plan
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- How Do You Measure Up Financially?
- Why IKEA Is Killing My Finances
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- Credit Karma: Free Credit Score No Credit Card Required
- Sallie Mae 2% Cash Bank & $100 Sign Up Bonus
- How To Save Money At Costco