It's no news by now, the government is bailing out those Detroit dinosaurs known as the auto companies, in spite of my sound advice. Don't those slackers in D.C. read Money and Such? One part of this bail-out is the rescue of GMAC - GM's financing arm - to the tune of $6 billion. I decided that it would be interesting to figure out how much of my own personal money the government is handing over to the shareholders of GM, the private equity firm Cerberus (which owns Chrysler) and to the United Auto Workers... Bear with me as I run the numbers on the back of this handy envelope (which I also use to accept bribes for appointing U.S. Senators):
There are approximately 330 million people living in the U.S., which means that each of us is paying about $18 to this failing company. There are five people in my household, and since our three kids are not currently paying taxes (living at the expense of the working class), my wife and I would be paying about $90 to stave of the evil creditors of that noble establishment. But wait! Not all U.S. residents pay a similar share of this nifty Christmas bonus to GMAC owners, I happen to be a bigger tax benefactor than most.
According to Kiplinger's our household income places us in the top 5% of tax payers. Good for us. However, we are not quite lucky enough to be in the top 1% of the pyramid. The same article suggests that the top 1% of tax payers account for 40% of taxes (yikes) and the top 5% accounts for 60% of taxes. This means that excluding the top 1% my income group accounts for 20% of all income taxes paid. Now we are ready for some real action: there are about 100 million households in the U.S. - 4% of us or a total of 4 million account for 20% of the bills paid, which means that our personal share in the GMAC bail-out comes to a tidy sum of about $1,500. Sweet. Will that be cash or credit?
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