Problem solving today is less about finding solutions and more about convincing the powers that be to want to solve them.
Take for example the out of control legal costs that could easily be solved with a version of “loser pays.” It would lower the number of frivolous lawsuits, which lessen malpractice suits, which would eventually lower medical costs, which would lead to more affordable healthcare. But since our government is made up of trial lawyers, i.e. Sen. Edwards, that law will never be passed.
The new Stimulus Package proposed by President Obama presents another example. No economist or politician has or can show definitively how the new plan creates even an ounce of economic stimulus. The powers that be are NOT concerned with solving the crisis as much as taking advantage of it.
The proposed $900 Billion “Stimulus” which the House has approved and is claimed will pass the Senate, is estimated to ultimately cost somewhere around $7.5 TRILLION. *
That's about $25.000 for every man, woman, and child in the US.
Since the approval does not lock in allocation of funds, here is a novel idea. It’s OUR money, so let's get serious about stimulating the economy. Let's get serious about CHANGE, and give it to... ourselves.
Wouldn't this help the economy? For those non-system thinkers, let’s take a look.
If everyone receives 25k that means a family of say 5 receives 125.000...tax free! What happens?
1. Public calms down
2. People with bad mortgages start to pay them off, property value goes back up, value in bad Fannie paper goes up, financial institutions which invested in the bad paper raise in value, banks start to loan to companies, companies can pay for daily expenses and begin to hire again.
3. People without bad loans buy!! Company revenues rise, jobs return, money starts flowing.
4. Crisis over!!
But wait...Add to that...for the first few months, CANCEL Capital Gains TAX – watch what happens....
1. Investment activity in the market goes up (especially for those who just received 100k!!)
2. Confidence in market goes up
3. Company values go up
4. People start making money
5. Companies hire more
6. More people make money, which spend more, which means more jobs, more money, bla, bla , bla,
7. Banks and Companies are friends again. Bosses and employees are happy again and most importantly my landlord and I are friends again!! :-)
So the answer is logical, but is it realistic?
* http://abcnews.go.com/Business/Econ
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