Among the many financial problems we are having is the imminent failure of the U.S. auto industry. Some argue that we should not do anything and let the auto makers fail. After all, the argument goes, they were responsible for getting themselves into this mess. Why should the taxpayers just hand over billions to them?
I agree with those sentiments. However, I am persuaded that to let the U.S. Auto Industry fail would have repercussions so far ranging and hurtful to the overall economy that we cannot let it occur. But, rather than just hand the money over, I have an idea.
Instead of just handing over billions of taxpaying dollars to the auto industry and hoping for the best why not attach some strings. How about all tax payers get "shares" in the amount for the loan. For instance, if the bailout equals $2,500 per taxpayer, each of us would get a certificate for our portion of the loan. This is not stock in the company, rather it is a voucher for our "share" of the loan.
We would all have to understand that these certificates may never have any value. But, if the auto industry does rebound, the original $2,500 value of the shares would appear and possibly grow. There would have to be a time limit before anyone could even hope to redeem them - 10, 20 years? But after that those shares could be used to get our money back at that time. The industry would have to stow away a portion of their profits (with the proportion growing over time) to be earmarked specifically for paying back the taxpayer. After the 10 or 20 year time period - we could cash in these vouchers for at least the face value.
Also as a bonus, since we all have a financial stake in this, Americans would be more likely to buy American over the next couple of decades, knowing that have a literal share in the success of the companies. If things go very well, Americans will put free market pressure on our auto industry to create better cars, we will all be motivated to purchase them, American jobs will stay here and we all profit from it. Sound like a great plan to me!!
I agree with those sentiments. However, I am persuaded that to let the U.S. Auto Industry fail would have repercussions so far ranging and hurtful to the overall economy that we cannot let it occur. But, rather than just hand the money over, I have an idea.
Instead of just handing over billions of taxpaying dollars to the auto industry and hoping for the best why not attach some strings. How about all tax payers get "shares" in the amount for the loan. For instance, if the bailout equals $2,500 per taxpayer, each of us would get a certificate for our portion of the loan. This is not stock in the company, rather it is a voucher for our "share" of the loan.
We would all have to understand that these certificates may never have any value. But, if the auto industry does rebound, the original $2,500 value of the shares would appear and possibly grow. There would have to be a time limit before anyone could even hope to redeem them - 10, 20 years? But after that those shares could be used to get our money back at that time. The industry would have to stow away a portion of their profits (with the proportion growing over time) to be earmarked specifically for paying back the taxpayer. After the 10 or 20 year time period - we could cash in these vouchers for at least the face value.
Also as a bonus, since we all have a financial stake in this, Americans would be more likely to buy American over the next couple of decades, knowing that have a literal share in the success of the companies. If things go very well, Americans will put free market pressure on our auto industry to create better cars, we will all be motivated to purchase them, American jobs will stay here and we all profit from it. Sound like a great plan to me!!
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