Sep 25 2008
I just came up with an even better plan!
Here goes:
Apparently US consumers have built up about $850 bln in credit card balances. Why not just have the federal government pay that all off? It’s a bit pricier than the Paulson plan, but think of the benefits!
- We immediately improve the financial standing of the majority of adults in this country.
- The financial system is massively liquified, easing the current crisis.
- There would be tens of billions in savings on interest charges.
- Consumers will have a clean slate to start consuming again.
OK. Clearly this plan has some moral hazard and other fiscal issues. It would be enormously popular, though.
Here are some other posts which might interest you:
- Financial Shock
- Implications of Deficit Spending
- Doing the Treasury bailout without taxpayer money
- The Treasury is Going to be Very Busy
- Trading on the Clunkers Program?



Classic.
If they do that, I am going to become a tax evader for the rest of my life….Willie Nelson style.
Excellent idea.. and at the same time cancel everyone’s credit cards so they have to apply for new limits again.
Andy – I hope you’re a better evader than Willie!
Jeff – I like the way you think.