The current economic crisis is not a partisan issue, and this is not the time for partisan bickering. What we need to understand is that 700 Billion dollars is a lot of money. Personally, I want to hang the people responsible, but I have a better idea. I am normally not for new taxes, but someone needs to pay this bill. The median household earns 44,380 annually. The median household size that earns the median household income is 2.57. This translates to roughly 277 hours worked for every American. This is nearly 7 weeks--that is how long all of us are going to have to work to make this much money.
I only support the bail out if it is going to save jobs and livelihoods. I personally have my doubts about that. I really think that this will exacerbate the problem. In other words, credit will be more difficult to get and housing prices will plummet even further and at a faster rate. The resulting recession may be shorter, but it will be much worse. I would be like getting a flu shot that gives you all the severity of a two week virus in 24 hours. Do we really want this? I don't.
I have been laid off three times in my career. The first time, I got one months severance, the second and third time, I got two months severance. I had a coal parachute that was full of holes. This is what grunts at the bottom of the food chain get when they are involuntarily separated from a company. Only senior executive get the big bucks.
My idea to fix this is bail those guys out, but introduce a new tax. A tax on severance. The "Golden Parachute" tax. Severance packages are tax free up to 1 year salary, or $ 250,000, whichever is lower. Anything beyond that is taxed at 99%. No shelters, no loopholes. This does not cover retirement if you take a pension or an annuity. It does cover a lump sum retirement package. It does cover "voluntary" separation. The government will have the right to investigate any unusual retirements--like someone retiring under the age of 60, or retires and then becomes the CEO of another company, etc. In other words, if you run a company into the ground, you will pay. The government will collect it from you.
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