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Practically Speaking

Kyle and her husband moved to Brookfield in 1986. She became active in local politics and started blogging in 2004. Her focus is primarily on local issues but often includes state and national topics, too. Kyle looks at things from the taxpayers' perspective in a creative, yet down to earth way, addressing them from a practical point of view.

Binge eating, binge drinking, binge shopping, now, binge bailouts!

Government / Bureaucracy, TAXES, THE ECONOMY

 http://www.onenewsnow.com/Headlines/Default.aspx?id=333108 Fed to buy $600 billion in mortgage-related assets. nov 25

WASHINGTON - The Federal Reserve says it will buy up to $600 billion in mortgage-backed assets in another attempt to deal with the financial crisis.

 

The Fed says it will purchase up to $100 billion in direct obligations from mortgage giants Fannie Mae and Freddie Mac as well as the Federal Home Loan Banks. It also will purchase another $500 billion in mortgage-backed securities, pools of mortgages that are bundled together and sold to investors.

The $600 billion effort on mortgages came as the Fed also unveiled a new program to help unfreeze the market that backs consumer debt such as credit cards, auto loans and student loans.

Last year's was $168 billion

House to push $500 billion stimulus bill   

WASHINGTON (Reuters) – U.S. House of Representatives Speaker Nancy Pelosi met leading governors on Monday to discuss the size and shape of an economic stimulus package that one Democratic aide said was likely to cost around $500 billion.

The aide, who asked not to be identified, said the legislation would include a middle-class tax cut, billions of dollars for road, bridge and mass transit construction, expanded aid to states and investments in renewable energy.

Speaking to reporters earlier, Pelosi said she hoped the job-creating legislation, which she did not detail, would be ready for President-elect Barack Obama to sign when he takes office on January 20.

"We'd like to have it ready for the president-elect," Pelosi told reporters before meeting Govs. Ed Rendell, a Pennsylvania Democrat, and Jim Douglas, a Vermont Republican. "I think we will be coming to some agreements today."

Rendell chairs the National Governors Association and Douglas is the vice chairman. Obama and Vice President-elect Joe Biden will meet U.S. governors in Philadelphia on Tuesday to discuss the economic crisis.

The House passed a $61 billion stimulus in September but opposition from Senate Republicans backed by a Bush administration veto threat killed the bill in the Senate.

Pelosi's meeting with the governors came as the National Bureau of Economic Research said the U.S. economy entered a recession in December, 2007.

U.S. unemployment has been rising, the financial industry is reeling even with the recent enactment of a $700 billion government bailout, and Congress must decide whether to rescue domestic automakers, who face a Tuesday deadline to provide Washington with restructuring plans.

Governors and state legislatures are asking Congress to act quickly on an aid and job-creation bill, noting they face severe budget shortfalls in 2009 and 2010.

At $500 billion, the measure would dwarf the $168 billion economic stimulus that was enacted last February, which consisted mostly of tax rebates for families and small business tax benefits.

The new emergency spending would add to spiraling government spending which sent the budget deficit to a record $455 billion in the fiscal year that ended September 30.

Hoping to blunt Republican criticism that Democrats are cobbling together a massive bill full of wasteful spending, Pelosi said the measure would be aimed at "creating jobs for the 21st century," with a focus on energy projects.

Obama has said that his first priority when taking office would be signing an economic stimulus bill into law.

 

 

For $350 billion less, we could just let Americans have a total Federal Tax holiday for 2 - 6 months. No income tax, fica, etc. That means that WORKING people would all experience a proportional tax break. Newt Gingrich favors. Sensenbrenner suggested something like it last year. BUT, our politicians would never want that to happen because you would realize how much of your check goes to feed the tax monster.

 http://www.humanevents.com/article.php?id=29723 A People's Stimulus Package Newt Gingrich, Dec. 1, 2008

The bankruptcy of the current Washington political establishment makes Rep. Louie Gohmert’s (R-Texas) new proposal for a tax holiday proposal intriguing.

Rep. Gohmert has calculated that the amount House Speaker Nancy Pelosi and Treasury Secretary Henry Paulson will be advocating for the second installment of the bailout -- $350 billion -- is more than the amount needed to allow every American to have a two month tax holiday from both the FICA (Social Security and Medicare) and income tax.

Let me repeat that: What Pelosi and Paulson are proposing to pour into crony capitalism is more than what it would cost to give every American taxpayer a total federal tax holiday for two months.

Which do you think would do more to get America growing again? $350 billion to failing managements, “overrated dopes,” and “greedy cynics,” or allowing every American to simply keep all their money for January and February?

The Money You Will Keep? Your Monthly Income Multiplied by .66

For the working poor, a FICA tax holiday (the $350 billion Paulson was going to send to Wall Street would simply be used to cover the revenue losses in the Treasury so Social Security and Medicare would not lose a penny) will be a dramatic increase in take home pay. This one act will save more homes from bankruptcy than any centralized government bureaucratic red tape ridden system.

If you want to figure out how much Rep. Gohmert’s tax holiday would save you, Jed Babbin of Human Events has this advice:

“Most Americans pay about 25 percent of their income in federal income tax and another 7.25 percent in FICA (Social Security and Medicare taxes). Computing how much money Gohmert’s tax holiday would leave in your family’s checkbook is very simple. Take your monthly income (the gross amount shown on your pay stubs before tax and any other withholding) and multiply it by 0.66. That amount is roughly what Gohmert’s two-month tax holiday will leave in your pocket.”

If a Two Month Tax Holiday Sounds Good, Why Not Six Months?


But there’s more.

Speaker Pelosi’s desire for an additional $700 billion Washington centered, government stimulus program would actually create the opportunity to offer an additional four months of FICA and income tax holiday for the American people.

If the American people knew they were going to have no personal federal taxes until July, 2009, how much debt could they pay down? How many mortgages would be saved? How many college tuitions could they pay? How much could they invest to rebuild their retirement accounts?

This is an example of what President Lincoln meant by “thinking anew.”

Send me a note at Newt@newt.org letting me know what you think of the tax holiday idea.

And if you like the idea of not paying federal taxes until July, 2009, please send this article on to your friends and encourage them to speak out on these new solutions.

 

 

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