DEBT RELIEF ACT of 2008
- By l.t. Dravis
- Published 11/7/2008
l.t. Dravis
I created and have written the nationally distributed marketing newsletter, BOTH SIDES NOW, since 2003. I authored two books, BOTH SIDES NOW, Sell Like Professional Athletes Win and DEATH OF A SALES MANAGER. In 2008, I introduced a daily column for national syndication to newspapers.
Photo Credit: WCBS880.COM
WASHINGTON,
D.C. – Friday, November 7, 2008 – WITH BILLIONS OF TAXPAYER BAILOUT DOLLARS FLOODING BANKS, WILL THE
ECONOMY TURNAROUND TODAY, TOMORROW, NEXT WEEK, NEXT MONTH . . . EVER?
The Bush administration just announced plans to borrow $550 billion
to finance the Wall Street bailout through the end of the year.
At the same time, the Federal Reserve said it will boost interest
payments to banks and the Treasury Department plans to auction off $55 billion
in government bonds next week.
These efforts won’t do anything more than put a slight dent in the
stack of cash required to fund the $700 billion bailout plus cover the $1
trillion deficit anticipated for next year.
Nevertheless, with all that cash flowing into banks, the economy
should begin to stabilize . . . sooner or
later . . . shouldn’t it?
After all, didn’t all those ‘experts’ who testified before Congress
a couple of months ago assure us that as soon as bailout bucks hit banks to
relieve their liquidity problems, credit would be freed-up, businesses and
consumers would start spending, folks would stop losing their jobs, and the
economy would stabilize and begin to grow again?
I’m not talking about ‘immediate’ results . . . I don’t expect the
economy to turn around on a dime . . . it won’t because it can’t.
But, were the ‘experts’ telling us the truth when they said the
‘bailout’ would fix the economy?
Let’s go beyond the sales pitch laid on us by all those ‘experts’
and look at the bailout package for what it is.
The bailout was designed to save banks from a liquidity crisis.
It was not designed to increase the buying power of the millions of
individuals and hundreds of thousands of businesses who actually drive the
economy.
While the House and Senate want us to believe they did something
great for the nation by surrendering $700 billion to the Treasury Department to
‘save the economy’, that money is not likely to ever reach the people –
consumers and business owners – who ultimately need cash and credit to spend
the economy out of this recession.
We don’t need some high-falutin’ expert with a bunch of letters
after his or her name to tell us that credit is essential to get the economy
moving again. It’s an uncomfortable truth hard-working Americans live with
every day.
In these days of tighter credit standards, business and consumers
can’t get new credit essentially because they can’t pay back current credit. So,
they can’t spend.
And if business and consumers can’t spend, they can’t create demand
for products and services, more jobs will be lost, more businesses will fail,
and the recession will continue to deepen and extend.
The solution to the economic legacy left us by eight years of the
combined arrogance, incompetence, and impotence of George W. Bush, Dick Cheney,
and a Republican House and Senate lies not in stuffing billions of taxpayer
dollars into the back pockets of bankers but in increasing the buying power of
consumers and business.
And, unless and until the ‘experts’ get that concept through their
thick skulls, the recession will continue to spread . . . ever deeper and
wider.
But we don’t have to wait.
We have the power to change things.
Contact your representative and senators – incumbents and new ones,
if you have new ones – and ask them to support or even introduce the Debt
Relief Act of 2008.
If they don’t know anything about the Debt Relief Act of 2008,
don’t be surprised . . . I’m just about to write an abbreviated version of it.
Read on:
DEBT RELIEF ACT OF 2008
TITLE: This is a bill to
provide authority for the Federal Government to purchase secured and unsecured
personal and business credit card debt, secured and unsecured personal and
business loans, and mortgage debt at discounted rates to be repaid to the
government plus interest over definitive periods of time. This bill is designed
to prevent disruption in the economy and the financial system and to provide significant
returns on investment to taxpayers. Specifically, this bill will free up
billions of dollars in buying power for businesses and consumers; Consumers who
take advantage of the provisions of this bill will manage future credit wisely;
Banks and other financial institutions will be relieved of potentially
devastating losses and exorbitant collection costs; Small, medium, and large
businesses – including service, manufacturing, distribution, transportation,
and retailers – benefit from immediate, managed consumer purchasing power;
Credit markets will be stabilized and will become predictable and profitable;
and, Taxpayers will become shareholders in the U.S. economy with accumulated
profits to lower taxes, offset government spending, and pay down the national
debt.
SUMMARY
SECTION 101: Authorizes the Secretary of the Treasury
to establish a Debt Refinancing Program (DRP) to purchase secured and unsecured
consumer and business debts from any financial institution in accordance with
terms and conditions defined herein.
SECTION 102: CONSUMERS AND BUSINESS WITHOUT
MORTGAGE DEBT - Directs the
Secretary of the Treasury to purchase secured and unsecured business loans, credit
card debt, personal loans, student loans, and vehicle loans from banks and
financial institutions at a discounted rate of twenty percent (20%) for
qualified individuals and businesses with proven ability to repay on a monthly
basis over a term of up to fifteen (15) years, plus interest at the rate of six
percent (6%) per year.
SECTION 103: CONSUMERS AND BUSINESSES WITH
MORTGAGE DEBT - Directs the
Secretary of the Treasury to purchase secured and unsecured business loans,
credit card debt, mortgages, personal loans, student loans, and vehicle loans
from banks and financial institutions at a discounted rate of fifteen percent (15%)
for qualified individuals and businesses with proven ability to repay on a
monthly basis over a term of up to thirty (30) years, plus interest at the rate
of six percent (6%) per year. Monthly payments will be automatically deducted
from payroll income, business income, investment income, insurance income,
retirement income, and all other forms of income, no matter the source or
frequency. If the home is sold prior to repayment of the loan, the federal
government would be entitled to half of the profit but would not sustain a
loss. EXAMPLE: Total debt acquired by the Treasury department in the amount of
$350,000.00 (discounted to $315,000.00) for each individual would be paid back
at the rate of $2098.43 per month. Including the initial discount rate and interest
revenue, total gross profit generated for taxpayers would be: $439,434.80.
SECTION 104: Individuals who
participate in DRP, irrespective of current credit rating, would qualify
provided they can prove the ability to make monthly payments, agree to attain a
minimum 700 FICO score within 24 months, maintain all appropriate forms of
insurance on collateral, and file state and federal tax returns, subject to
annual audit, on time. There would be no prepayment penalties.
SECTION 105: Individuals who participate
in DRP and who serve the nation would be credited with a portion of the monthly
payment, dependent upon service rendered. For example, those who serve in the
armed forces could receive 75% credit of monthly payments for their period of
service, without limitation. Others who teach in inner city schools or practice
medicine in rural communities could receive 50% credit of monthly payments for
their period of service, without limitation. If then, a homeowner served in the
military or taught in inner city schools or served in another approved vocation
for thirty years, he or she would able to retire, debt-free, with a paid-for
home, and with a substantial retirement income. Done right, we could create a
generation of financially secure retirees in this country by 2038.
SECTION 106: Directs the Secretary of the Treasury to
integrate DRP within the existing infrastructure of the Treasury Department so
as to not incur excessive program management costs.
SECTION 107: Directs the Secretary of the Treasury to
authorize financial institutions to operate as financial agents of the Treasury
Department with no compensation or reimbursement of expenses associated with
DRP and to establish protocols to purchase, hold, and sell secured and
unsecured debts and collateral, thereof.
SECTION 108: Directs the Secretary of the Treasury to
designate local agents to monitor transactions to prevent financial
irregularities, including sales or disposals of collateral without prior
Department of Treasury approval. Exemption: Collateral and/or debt acquired by
the Treasury Department acquired through an acquisition, merger, or purchase of
collateral or debt from a financial institution in bankruptcy, under
conservatorship, or in receivership.
SECTION 109: Requires the Secretary of the Treasury
to deposit all funds, deposits, and receipts collected from participating
financial institutions, individuals, and businesses into the Treasury of the
SECTION 110: Establishes an Oversight Board to
monitor, review, and report to Congress on expenditures, obligations, assets,
and revenue resultant from the purchase, management, disposition, and sale of
debt and collateral under this Act.
SECTION 111: Directs the Secretary of the Treasury to
report monthly to Congress regarding assets, liabilities, expenditures,
collections, and the status of regulatory oversight.
SECTION 113: Directs the Secretary of the Treasury to
manage this Act in accordance with all applicable Federal, State, and local
laws, regulations, and protocol.
SECTION 115: Terminates this Act, subject to
Congressional revue, on December 31, 2009. Authorizes a one year extension of this
Act if the Secretary of the Treasury submits an approved certification to
Congress.
Copyright © 2008 by LTD Associates West, Ltd. All rights
reserved.
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