OBAMA'S NEW ECONOMIC RECOVERY PLAN

I read things like this and cringe:

Relax rules on early withdrawals from retirement savings
Obama has proposed letting workers who are having a hard time paying bills make penalty-free early withdrawals from their IRAs and 401(k)s in 2008 and 2009. One could withdraw up to 15% of one's balance but not more than $10,000. Normally such withdrawals made before age 59-1/2 are taxed as income and are subject to a 10% penalty rate. The provision would apply retroactively to Jan. 1, 2008.

Social Security is already a disappearing proposition for my generation, and along comes a presidential candidate saying, "Go ahead, spend down your retirement." Imagine the pressure on the financial markets when the assets of the IRAs and 401(k)s (Here is a hint - think stocks and bonds) are liquidated. We should be ENCOURGAING savings, as our national average is below zero percent.

Give seniors a break in a bad market
Obama said he agrees with the proposal Republican nominee McCain made last week to temporarily excuse retirees from having to cash out a percentage of their IRAs or 401(k)s when they turn 70-1/2.

OK, according to CNN, "since the minimum required amount to be withdrawn in a given year is based on one's account balance at the end of the prior year, it can be a much bigger hit to seniors' nest eggs when they have to make their withdrawal after the market has fallen precipitously. On Monday, the Dow was down 29% from where it was on Dec. 31, 2007." This one makes sense, and I agree with it.

Have the federal government lend to state and municipal governments
Obama wants to help counter the budget crunch faced by states, whose tax receipts are declining while demand for and cost of public services is rising.

How much more money can our federal government hand out? We are already borrowing vast amounts to finance the war, the bailouts, the general budget, etc. This one has INFLATION written all over it.

Encourage job creation
Obama wants to offer a temporary tax credit of $3,000 in 2009 and 2010 to companies for each new full-time employee it hires in the United States.

Companies could be encouraged to create jobs by reducing capital gains taxes and reducing OVERALL taxes, rather than more tax credits.

Extend unemployment benefits and temporarily suspend taxes on them
Obama, like most Democrats calling for a second economic stimulus package, wants a 13-week extension of unemployment benefits to help those who may be unemployed for more than six months.

While, in theory, this seems like a plausible idea, the question of where will you find the money to replace the lost tax revenue, and fund the additional benefits, is unanswered. Another Obama proposal that appeals to the masses, and then comes with a hefty pricetag.

Require foreclosure moratoriums
Obama said he wants to require any financial institution that participates in Treasury's Troubled Asset Relief Program for financial institutions to put a 90-day moratorium on foreclosures for homeowners "acting in good faith." The moratorium, according to the Obama campaign, would offer a time-out to give the lender and homeowner more time to work out an agreement that could keep the homeowner in his home.

Please define what is "good faith". And will someone please tell me why the government continues to prop up people who have mortgages they should not have signed and cannot afford. Any deal between the bank and the homeowner should be just that - between them.