|2/8/2014 3:34:00 PM|
Hammer nails government bailouts
"Hey Timmons, you ever heard of the Townsend Plan?"
I jumped, first because I was hard at work going over the shambles that was my NCAA bracket and didn't notice the big hulk of a man standing in my doorway. I jumped second because when The Hammer talks it sounds a little like work boots walking across a gravel road, rough.
"Hi John," I said, closing the computer screen. "Not sure. Wasn't that some old coot who wanted to give the elderly a hundred bucks a month or something back when FDR was in office?"
"No," the Hammer snorted. "I didn't expect a newspaper guy to know anything. The Townsend Plan came from a doctor from Illinois. He wanted to give the elderly $200 a month. This was during the Great Depression and he said that if you gave everyone over 65 that kind of money they would spend it and it would pull the country out of the Depression."
"Yeah, I remember a little of it now," I said. "Isn't that what basically turned into Social Security?"
The Hammer's look told me that I might be in the ballpark, but his patience didn't allow for a history lesson today.
"Been thinking," he began. "Do you know how much the government has spent on all these different bailouts?
"I heard it was around $11 trillion."
"Depends on who you ask," he said. "I went on the Internet and tried to figure it out. Found a lot of different answers. Don't know why that should surprise me," he snorted. "Saw one report that said $5 trillion, but found others that said upwards of $30 trillion."
He had a good point. I read a newspaper story that said it was difficult to get an exact answer on the total amount of money given to various bank and auto companies during these so-called bailouts.
"So I got to thinking about what kind of shape we're in now, compared to what kind of shape we were in before those bailouts started," he continued. "Doesn't look a whole lot better to me.
"Then an old buddy I used to work with sent me an e-mail that said we ought to give everyone in the country a million bucks and let them spend it on cars, houses, what-not, and that would fix the economy.
"'Course we can't do that," he went on. "There more than 300 million people in this country. The numbers won't work. But you know what, Timmons?"
I had no idea where the big guy was going. But I learned a long time ago, you don't really question John Hammer.
"There's only about 50 million people over the age of 50. And if you take out the folks over 65, that brings the number down to about 35 million legal Americans between 50 and 65."
"OK John, but what's your point?"
"The point is that those 35 million are the answer."
"We need more jobs, we need U.S. auto companies to do well and we need the housing market to get better."
I still didn't get it.
"Give those 35 million people $1 million each," the Hammer said, as if that explained everything.
"John, that's nuts," I started, before the frown he gave me made me rethink my next words. "Look, John, there's no way that Washington is going to give anyone that kind of money," I said. "How much is that anyway?"
He frowned again. "What'sa matter, Timmons. Didn't they teach basic math in your school?"
This time I frowned. I picked up my solar-powered calculator and punched in 35,000,000, hit x and typed in 1,000,000. The small screen said Error.
"It's $35 trillion, dummy," Hammer said. "The way I figure it, they've already spent that."
"Maybe so, but no one is going to give that much money away."
"Why not," he answered. "I'm not saying it's just 'given.' I'm saying there are stipulations, conditions. For example, everyone who accepts it must retire. That creates a ton of jobs. Then, they have to go out and buy a U.S.-made car. Bingo, auto industry fixed. Third, they either have to pay off their mortgage or buy a new house. Housing crisis? Over."
"But John," I tried. "Not everyone can do it. For some, even $1 million wouldn't get them out of hock."
"They can just say no," he answered. "But there's a whole lot of working middle class that would take advantage of this. And I'm telling you, it would fix a whole lot of the problems we have more than these other bailouts has. And I'm telling you one more thing about this 50 to 65 age group."
"What?" I asked.
And with that, the Hammer walked away. I sat there shaking my head. This would never work. Would it?
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