Thursday, December 04, 2008

“I saw Congress playing Santa Claus...” *

Apparently, the blatant manipulation of pubic opinion in an election year, was quite a drain on the newspaper industry, which is having enough trouble competing with electronic forms of media these days. A recent issue of Business Week devised a tongue-in-cheek plan to bailout the daily rags. It was supposed to be a joke, right? But in her syndicated column this week, Michelle Malkin says they're not joking.

'Tis the season for bailouts. A lot of people are flying private jets into Washington just to beg for them. Many have been turned away, because for all the begging, they didn't have a plan.

Fortunately, I have a worthy cause for a bailout, and it definitely comes with a plan from the get-go.

My 23-year-old son Paul needs to get through college. His Federal financial aid sources are in jeopardy, and it's not hard to figure out why. I'll spare you the details, but we have to come up with something. That's why I'm contacting my Congressman. He's a good old-fashioned tax-and-spend Democrat, who (probably) votes for every pay raise he gets whether he deserves it or not, and still sleeps like a baby at night. Just the man I need in my corner.

So, here's the deal. Paul is a full-time student, but only takes three classes per academic quarter instead of four, so he can work part-time as a bartender. Three classes per quarter costs $6000 for our subtotal. He's already taken care of for the coming winter quarter. That leaves nine academic terms (including summer quarters) before he graduates at the end of spring quarter in 2010. That brings the total to $54000 -- so far.

Then there's books and supplies. Paul is majoring in Game Art and Design, so we're looking at some high-tech stuff. Now high-tech means high-end software, and a totally state-of-the-art laptop. It could come to, oh, about $1000 per term on average. So let's add $9000 to the list, for a total of $63000.

Obviously people who come for bailout money are expected to continue living in the grand style to which they have become accustomed. For Paul, that includes a housing allowance. At $800 per month (which is what he got before), or $2400 per quarter, we multiply that times nine for a subtotal of $21600. That brings the total to $84600.

Now, we all know to expect the unexpected. So let's tack on an additional $600 per quarter, for a subtotal of $5400. That brings the (grand) total to a mere pittance at $90000.

Ninety thousand dollars. And while the automakers will either be retired on fat pensions or dead by the time their loans are paid off, Paul will be increasing his income potential for the duration of the loan. He has agreed in principle to have exactly $500 taken out of his account on the first of every month. At $6000 a year (roughly ten percent of his estimated starting income), he would have it paid off the principal in fifteen years. I have yet to run the numbers on interest, but I cannot imagine it adding more than five years to the loan.

This means that, in twenty years, Paul would have the loan paid off. He would also establish an excellent credit history, and still have the moxie to pony up a sizable down payment on his first condo before he turns thirty.

Compared to Wall Street firms investing in bad paper, and USA automakers tacking on two thousand dollars more in organized labor costs compared to foreign companies, I really don't see a problem here. I'm even willing to put in up to $500 for the purchase of Paul's first suit, so he doesn't look like a punk-ass kid in front of a congressional committee. I'm that proud of him.

(Oh, and Paul, lose the nose ring.)

* Apologies to Tommie Connor, who wrote the music and lyrics to "I Saw Mommy Kissing Santa Claus" in 1952, as well as singer Jimmy Boyd, who took it to Number One on the Billboard charts that year.

[UPDATE: An anonymous (naturally) reader tells us: "I would guess that you have grossly underestimated the effects of interest. I would expect that the length for payback would be closer to 30 years than 15... Perhaps it will illuminate why we find so many folks in such difficult financial circumstances: They do not understand what they are getting into!" First off, thanks for writing. Now then, I personally haven't met a law or medical student to whom this would not apply. Nevertheless, if anyone knows of an online table for estimating payments with interest over the long term, please contact us here at mwbh, and we'll share it with the huddled masses.]

1 comment:

matthew archbold said...

Ah, what's a few billion dollars between friends?