These Tough Economic Times: Part 2

As promised, this is the second portion of my 2 part post about the economy. Last time, we looked at whether or not the "bailout" of several corporations performed by the US government was really the proper thing to do to try to help the economy. Today, we will look at what could have be an alternative method of solving the problem. Before I begin, I want to remind everybody that I can't take credit for this idea, its not mine, but I'd like to bring it to the light of day. Also, this plan is probably unusable now, since the government is so deep into the plan they're running, but there's nothing wrong with a little speculation and the bouncing of ideas. So what is this plan?
Its really quite simple. There are approximately 300 million American citizens in this country. Every single one of them should receive $300,000 from the government. Why? To inject an influx of cash into the economy. Now, unlike the bailouts, this money would have some requirements to it. $100,000 of it must be spent within 2 years. Another $100,000 needs to be invested in something within 2 years. The other $100,000 can go to either of those uses, or any other use imaginable. You see, the problem right now is that people aren't willing to buy stuff either because they don't have the money, or they don't have trust in the economy right now. With this plan, the government gives the people some money to blow. There's little risk involved for the citizens as they won't be any worse for the wear if whatever they spend the money on doesn't work out, it was money they didn't really earn anyway. The other rule on the invested money is that after those initial 2 years, $25,000 of it can be withdrawn every 5 years if the investor likes. By having people invest a third of the cash, it would create healthier banks that would then feel a lot more comfortable to start lending, helping the weak housing market and interest rates in the process. Its a good plan, people have money to spend, which jump starts the economy. People have nice things, and the standard of living gets better, along with the other positives already mentioned.
Now, people will say this wreaks of socialism, and that the government has no right to meddle in the economy like this. They'll say that the government has no right to tell you how to spend more or what to do with money at all. They'll say that its too expensive of a project. That this plan would ultimately fail.
But its not true, at least in my estimation. Its not socialism, in fact its inverse Reaganomics, a very common US capitalism school of thought. Reaganomics being the idea of giving tax breaks and extra monetary benefits to the richest of the country. They'll spend the money on frivolous things and somehow through there business doings and spending it will provide a stronger economy. Well this is the opposite kind of. We're providing money for everybody, literally everybody (which reminds me of another positive, no poverty, at least for citizens) which will relatively be significant to the less fortunate of the country rather than the rich in Reaganomics. By using the massive new spending power being provided to the middle and lower classes, they can really inject life into the economy, and do it in a way seemingly less frivolous (my guess is a lot of the money would be spent on cars, appliances, houses, and the like, not mansions, airplanes, and yachts). I'd also say its fair to say the government should give guidelines on the money. I mean, ultimately they are providing the money. Don't people get paid under the assumption that they do their jobs? Well then, in this case the people are getting paid under the assumption (and actual checking, documentation of the money spending could be provided in the income taxes people file every year) that they spend it under the rules. It makes sense and is doable. As for expenses in the project, it would cost a grand total of $90 million, at least in the money paid out into the citizens. I don't know what it would cost to coordinate this, and include it in the tax forms and whatnot, but I imagine it couldn't be nearly as much as the $80 billion + the government spent in singular years in Iraq alone in the past decade. I think its a fair assessment to say the plan would be relatively inexpensive.
The only true opportunity I see for failing in this plan is that people may blow a lot of their $300,000 and be financing things in the process, meaning it could cause a scenario where they've blown their money and can't make future payments. The forcibly invested money could end up being a saving grace in this scenario. Maybe people could get financing reprieves until that money frees up so they can withdraw their $25,000 when eligible, to pay off their debts. The point is, the issue is able to worked around, and its an issue most responsible Americans wouldn't fall in to in the first place.
This is the economic plan, and I think its a really cool idea. It will never truly see the light of day unfortunately, but I thought I'd at least present it. Any opinions, flaw, likes, dislikes and whatever else are welcome. I aim to please.