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celticlord2112 -> Fuzzy math (12/10/2008 9:29:22 AM)
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Inaction on Big 3 would cost taxpayers billions
Here's an interesting tidbit about the proposed Big Three Bailout, from the Center for Automotive Research, speculating on the "cost" of the jobs lost if the Big Three are not given public funds:
quote:
Overall, that lost employment would cost government at all levels $50 billion next year and $108 billion over the next three years, the center estimates, with Washington bearing most of that cost. Almost a quarter of the money would be for unemployment, welfare, health care and other costs government would have to carry, while the rest would come from lost collections of income taxes and payroll taxes that support Social Security.
In a more severe scenario in which the Big Three halted all U.S. operations completely, the three-year cost to taxpayers would be $156 billion in lost tax revenue and higher spending, the center says.
So...best case if we don't bail them out, taxpayers are soaked indirectly for $50Billion. Middle case it's $108 Billion. Worst case is $156 Billion.
To avoid this we need to shovel money at them--first $25 Billion, then $34 Billion...and what a coincidence! The $15Billion Congress wants to give them NOW while they figure out what to do with taxpayer dollars brings that number up to (drum roll, please), $50Billion. With potentially more to come (Zandi's credibility is suspect, but his estimate of $75 to $150 billion needed overall to save the Big Three stands as the worst case scenario).
So the urgency of the situation is this: Government must spend $50 Billion (or more) right away to avoid losing $50Billion (or more) in tax revenue over the next few years. This is called a prudent use of taxpayer money.[8|]
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