Sunday, February 22, 2009

Economic Recovery: My Two Cents

I've been following the president's efforts (a little bit) to come up with a stimulus package that will please the most politicians while doing the most good. I live in a "red" state, and there are republicans all around me, so it's no surprise that most of the opinions I hear are against anything the president wants to do, or does. I live smack-dab in the middle of Bush country, and these folks are not happy that a democrat now holds the highest office in the nation.

I've also been thinking about the last stimulus package - the Bush stimulus package - the one that gave each taxpayer a rebate. It supposedly failed because most taxpayers (myself included) either put the money into savings or used it to pay off bills.

I think I've found a way to create a stimulus package that will work.

First, the rebate idea was almost a good one. The problem, as I said, was that few people actually spent the money. At about the same time the government quickly implemented a program to send out coupons that could be redeemed for digital converter boxes, so those who needed them could get them free or, at least, cheap.

So let's combine the two ideas.

Issue coupons that help people buy cars, or new digital TVs, or anything else that might stimulate the economy. Appliances, home repair projects, farm equipment - whatever.

Say I need a new car, but can't afford one. I get a government-issued coupon good for 10% of the price of a new car - but not over, say, $2,000. A simliar coupon could be issued for a used car, or that LCD TV, or farm equipment, or services. Paper coupons would probably be best, since the description and value of the coupon would be unique in many cases. I take the coupon to the store, or the dealer, or the contractor, and they/he "validates" that it was used and for how much (signatures of both customer and seller/provider required), and sends it off to the government to get paid. Or "deposits" it in a bank, said deposit to be made by the government.

The same system could be implemented on a larger scale for corporations and companies that need to buy (american) steel, for example.

Sure I don't have all the details. We don't need details unless someone wants to get serious about the idea.

You think there would be too large an opportunity for fraud? Maybe. Crooks will be crooks no matter what. We have a lot of systems in place now that allow a lot of fraud.

I think it might work.

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