As an observer of the economic recovery efforts currently underway I must say I have not heard a single plan that seems to be working. We have funded banks that are not loaning money. We have a scared populace that won’t borrow money. We have looming layoffs and worsening conditions. Not to mention the denial by executives getting bonuses and out right fraud that is being exposed by the failing markets. So here is the “Frazier Plan”
I was ordering a Coupon to get my Digital TV converter for my analog set and realized this program could be the answer. Briefly, the government is giving me a $40.00 coupon to purchase a $50 to $60 converter box. It occurred to me the government could do the same thing with autos. Think about it. Here is how I see this idea working in an auto environment:
-First rule: the car must be built in the US.
-Second rule: the car must be rated at 30 MPG Hwy.
-Third rule: the car cannot cost more than $17,000.
Each card carrying tax payer that is a US citizen could apply on line for a coupon valued at $8,000 to $12,000. The difference in the purchase price of the auto would be paid by the coupon holder, for example 20% of the purchase price. This brings in the rest of the private sector to start the economy moving.
This plan does not prop up the automakers waiting on the economy to turn around. What they need is sales. The proposed loans to the auto makers does not help the rest of the industry if no one is buying cars, and what about dealers, suppliers, shippers and lenders? The auto industry is large enough to completely jump start the economy. The taxpayer is funding the whole thing anyway so why not let the taxpayer be the principal beneficiary?
GM has three models that qualify...Ford has three models...Chrysler has one...Toyota has three. Customers would visit their local show room to order the car they want. They can upgrade with their own cash as long as the car meets the mileage requirement.
I estimate it will cost about 700 billion dollars. It will leverage another 700 billion in private money. It will reduce oil imports by about 1/3. So what are we waiting for? Send this on to your friends and to your congressman.
The Frazier Plan
Ed Frazier, Author