The Washington Post asks four smart folks how to save the economy. Here’s what they came back with:
Make stuff cheaper by suspending state sales taxes (Feds reimburse states for lost revenue). Ostensibly makes life cheaper for consumers, encouraging them to buy. We suspect that, in reality, consumers largely ignore sales taxes.
Make it so homeowners can automatically renegotiate mortgage terms when prices in their area fall more than 20 per cent. Lenders must participate. The problem: who wouldn’t jump at that? Also screws people dumb enough not to have a mortgage, but we guess we’re beyond caring about considerations like that.
Fully nationalize Fannie and Freddie to get mortgage rates down and get people buying houses again. Restoring consumer confidence will take a while, regardless of mortgage rates.
Suspend Social Security contributions. Would create a short-term stimulus. Wouldn’t do much for long term financial security.
All band-aids, in our opinion. The only real cure is time.
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