Critique my bailout plan

In My Humble Opinion
1

I can’t believe I’m going to write this, but I sincerely believe that the republican group mentioned in this story have at least a framework for a plan that would work. In fact it’s sort of similar to something pie in the sky I said to my wife while bitching about the proposed bailout. There exist in this country an industry with the wherewithal to come to the rescue, expand their business, and quite possibly make the American taxpayers, the financial companies and even themselves come out ahead.

From the article

We ask the health insurance companies to take a financial stake in the firms involved in the mortgage fiasco, in return we expand Medicare* to cover every American. The Insurance companies can then elect to extend insurance to their existing customers at a reduced rate for co-pay/boutique coverage. This plan frees up capital for not just the financial companies but also GM and Ford which are also teetering and just about every industry I can think of by freeing up a lot of capital that’s currently committed to employee benefits.

I’m sure there would still need to be some mechanisms in place for fixing bad loans. I’m also sure that there would have to be some regulations involved. But as a general plan, I think it could work. Critique mine or put one of your own up.

*I haven’t looked at numbers but I’d think that non retirees and the disabled would have some form of co-pay.

2

Not seeing why a health insurance company wants to buy a bunch of defaulted loans, deal with foreclosures, and abandon an establsihed profitable business model for…something else.

Also not seeing why current customers would continue to buy insurance if everybody gets coverage from Uncle Sugar.

If I were the insurance company, I’d decline that deal.

3

What about this plan…:smiley:
Wouldn’t this be nice? We can always dream.

I’m against the $85,000,000,000.00 bailout of AIG. Instead, I’m in favor of giving $85,000,000,000 to America in a We Deserve It Dividend!

To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+. Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up. So divide 200 million adults 18+ into $85 billon that equals 425,000.00. My plan is to give $425,000 to every person 18+ as a We Deserve It Dividend. Of course, it would NOT be tax free. So let’s assume a tax rate of 30%. SO … Every individual 18+ has to pay $127,500.00 in taxes. That sends $25,500,000,000 right back to Uncle Sam. But it means that every adult 18+ has $297,500.00 in their pocket. A husband and wife has $595,000.00.

What would you do with $297,500.00 to $595,000.00 in your family?

Pay off your mortgage - housing crisis solved. Repay college loans - what a great boost to new grads. Put away money for college - it’ll be there. Save in a bank - create money to loan to entrepreneurs. Buy a new car - create jobs. Invest in the market – capital drives growth. Pay for your parent’s medical insurance - health care improves. Enable Deadbeat Dads to come clean - or else. Remember this is for every adult U S Citizen 18+ including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back…and of course, for those serving in our Armed Forces. If we’re going to re-distribute wealth let’s really do it…instead of trickling out a puny $1000.00 (“vote buy”) economic incentive that is being proposed by one of our candidates for President.
If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+!

As for AIG - liquidate it. Sell off its parts. Let American General go back to being American General. Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up. Here’s my rationale. We deserve it and AIG doesn’t.

Sure it’s a crazy idea that can "never work.” But can you imagine the Coast-To-Coast Block Party! How do you spell Economic Boom? I trust my fellow adult Americans to know how to use the $85 Billion We Deserve It Dividend more than I do the geniuses at AIG or in Washington DC. And remember, The Family plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.

4

Try again.

5

I think you need to brush up on math. 85 billion / 200 million is $425.50

6

:smack: too funny, but I’d still rather have 425.00!

7

Yeah, that plan would sound better if there were yet another three zeroes after the “425.”

Imagine what we could do with all that money!

8

Hey, if thats all it takes, then why are they saying it will take a generation to pay it off? I can scrape together $425 to save the free world, … who else is in?

9

Because it’s not just $85 billion or $425 per person. It’s $785 billion or $3,925 per person. And that’s not your total end-of-the-day expenditure. That’s $785 billion IN ADDITION to the day to day costs of running the country. Money the Federal Goverment currently doesn’t have and will have to find a way to create (literally create) and then pay back. So yeah, if you and I and every one of our 200 million friends and neighbors want to write that check to the government for $3,925, we could solve the problem right now with no inflation and no interest charges. But remember that’s just the cost of the bailout. You’re still responsible for everything you currently owe in taxes as well.

Somehow I don’t see that happening.

10

Don’t forget, 700 Billion is only estimate, and addresses the now.

11
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It makes no sense and shows a fundamental lack of understanding of business, economics, finance, insurance, and in myrnajean’s case, third grade math.

Why the health insurance companies? Because you think they have an endless supply of money? And AIG isn’t included in those companies?

A slightly more nuanced plan would be to be to create an entity to buy up all the bad debt from those banks and insurance companies. Put the entity on a barge and sink it in the Hudson somewhere and problem solved.

The problem is actually a bit more complex than “some big banks ran out of money”.

13

If you give me only 400 billion, you can save the remaining 300 billion. That my plan, and I’m sticking to it.

14

Wow, you’re going to push health insurance companies into this financial sinkhole?

Um, no.

15

You’ll need one of Fabulous Creature’s mind-control devices to make the health care companies go for this.

16

Which is apparently what the bailout basically is.