American Dreams
(The Idea Book)
By John T. Butler
Copyright 2012 John T. Butler
Copyright Registration Number:
TXu 1-787-731
Effective Date of Registration: December 21, 2011
Copyright under the title:
World Without Wednesdays (The Idea Book)*
*It was unpublished under this title.
Table of Contents
Section I: Reviving American Real Estate
1.) The Housing/Education OASDI IRA
2.) VacationHomesMatch.com
Section II: Private Sector Ideas to Make You Rich
3.) YachtsMatch.com
4.) Love Lockets
5.) Club Costume
6.) The Grilled Cheese Grill
7.) Big Swings
Section III: A Non-Profit Idea to Help Your Favorite Charities
8.) Midnight at the Mall
Section IV: Public Sector Ideas for a Better World and Nation
9.) Cameras and Voice Print for Schools or Prisons
10.) The Prison Peace Corps
11.) The Living Death Sentence
12.) Limited Term Limits
13.) Three Point Two Redux Redo
14.) World Without Wednesdays, Amen
Preface
My dear reader, upon reaching the age of 67, I was forced to acknowledge that since graduating college I never have had the drive to translate one single solitary dream or idea into action. I am a shamelessly hopeless dreamer, not a doer. But I have not a shred of doubt that each and every idea shared with you, in this book, deserves to see fruition and thereby lead many to wealth and all to a better world. But it is the Recession and the moribund real estate market that compelled me to write and rewrite this book to share my dreams with the world’s doers. God bless the doers!
Section I
Reviving American Real Estate
Chapter 1: The Housing/Education OASDI IRA
Millions of younger Americans (some of them my own kin) claim to know with absolute certainty that Social Security won’t be there for them when they retire. As many experts, as not confirm this belief. The one thing all the experts agree upon is that the solvency of Social Security requires a fix of one sort or another. Popular among these fixes are raising the age or privatizing it. Which are both also very unpopular fixes. So I propose a compromise that contains circumscribed elements of both. For lack of a better name I call it The Housing/Education OASDI IRA. Hereafter for the sake of brevity we’ll refer to it as the SS/IRA (short for Social Security IRA).
The SS/IRA is a plan that offers one year of Social Security benefits now for two years of benefits deferment later. In more concrete terms (hypothetically) if the age you would first be eligible for full Social Security benefits is 67 and you opt to receive a year’s benefit before then, your eligibility is reset to age 69. In other words you have swapped two years later for one now. If you’re cocksure the benefits won’t be around for you when you reach 67 (or whatever your age of eligibility is) than you have nothing to lose by taking up the offer of one years worth of benefits today for the sacrifice of two years worth of benefits later.
The SS/IRA is all about freedom of choice. The individual chooses whether they wish to retire at the age of Social Security eligibility or defer that eligibility for two years, instead of the government determining that everyone shall have their eligibility deferred like it or not (for the sake of the programs solvency). It is not the intent of my SS/IRA plan to exploit the young's inclination to grab a quick buck or to undermine the purpose of Social Security. Therefore it is critical to this plan that those who choose a years worth of benefits today for the loss of two years benefits later be paid in funds that are not expendable as cash except for education, job training or housing. The plan must assure that the funds if spent, are spent wisely, that is invested in ones future while serving the greater interests of society as a whole. After all the intent of Social Security is to serve the individual through investment in their future, while serving the greater interests of society as a whole.
The SS/IRA is a lock box IRA that restricts investment to Government Treasuries or mutual funds (that meet risk requirements set forth by the government). Withdrawals from this IRA can only be made (for self, spouse, child or grandchild) for a down payment on a primary residence (or to refinance a primary residence) or for college tuition (or vocational training) or to repay student loans.
Funds invested in a home would be treated as encumbered home equity (i.e. lenders could not make loans or award a line of credit on that portion of equity and upon sale of the property the encumbered equity would return to the IRA account, if not rolled over into a new home). Otherwise the funds must remain in the SS/IRA until one year before your new extended eligibility date under the same withdrawal rules of a regular IRA. In the event that you die more than a year before the original eligibility date the full value of the SS/IRA must be refunded to OASDI. If you withdrew the money to invest in real estate then that money shall be repaid to OASDI when the property is sold, plus interest from date of death to sale.
Provisions for recapture of the money on death prior to the original eligibility date is perfectly fair, as you would not have collected in the event of death, had you never opted for the SS/IRA plan. Providing for recapture of money spent on repayment of student loans or on tuition for college or trade school could be included in the SS/IRA plan. Withdrawal for these purposes could be recovered by requiring a small part of the funds be set aside to pay for a life insurance policy that repays the money in the event of death before eligibility. (Age and a medical screening could further determine the price of the policy).
The Housing/Education OASDI IRA stimulates the economy while strengthening the solvency of Social Security. This is a genuine win-win! First the housing provision will provide the opportunity for millions to purchase their first home (or to refinance a home they were at risk of losing to foreclosure). Nothing is more important to the economy than revitalizing the housing market.
But the one thing that is equally important is providing a work force with the education and vocational skills necessary to compete in today's job market. That is why the plan allows withdrawal of funds from the SS/IRA for college or vocational school tuition (and in fairness to repay student loans). The latter also serves the housing market because student loan debt is a barrier to real estate investment. The modern economy will continue to displace workers and more than an unemployment benefits check, these displaced workers need the financial resources to return to school for retraining and reentry into the work force.
These provisions for housing and education provide the perfect cover for those Boomers who wish to postpone retirement beyond the age of eligibility for Social Security benefits. Now they can do it for the good of helping Junior with a down payment on a house (not to mention getting Junior to move out of their house). Or the Boomers can postpone retirement another two years in the name of helping their granddaughter pay for her college tuition or grandson with a vocational course in jet engine repairs.
True, one year of benefits varies from person to person based upon the amount paid into OASDI and age at retirement. Probably the fairest way to determine the award for one year is to base it upon the person’s contribution history at the time of application for an SS/IRA. The administrators of the program would have to devise a formula to extrapolate the benefit level based upon each applicant’s contribution history. Another alternative would b
e to set it at the current average for all Social Security recipients (which in 2010 was $14,124 per year). The latter is simpler and would probably attract more applicants. At the cost of housing or college $14,124 may seem insufficient but if Dad takes the deal for junior and junior takes the deal for himself it’s doubled to $28,248. (Now that’s real money for a year’s college tuition or a down payment or to pay off those old college loans).
This is very progressive proposal but without a doubt there will be some on the left who are aghast that this represents privatization. No question this plan represents privatizing but only privatizing one years worth of benefits. This in no way constitutes a slippery slope. If this smacks of privatization, that’s all the better, as it should help in winning support from the Republican side of the aisle, that is essential to passage of the SS/ IRA.
In 2012 the clock for the shortfall of Social Security funds was reset to 2033. (And it will surely be reset again somewhere in the same neighborhood). During the contest for the Presidency in 2008, then candidate, Obama declared that the shortfall could be fully remedied by simply removing the cap on payments into OASDI. The cap on OASDI payments is currently $110,100. (The cap means that once OASDI taxes were withheld on $110,100 of your income for that tax year, that no more taxes would be withheld.) The cap removal remedy cannot happen unless Democrats achieve a 60-vote majority in the Senate, a majority in the House and a Democratic President simultaneously. A big if!
Should removal of the cap and the consequent restoration of full long-term solvency be achieved, that would be the best-case scenario, in my eyes. If that should transpire then the impact of the SS/IRA plan for improving the long-term solvency of Social Security would have little relevance. Though, I would hope that in the very least, it would allow the eligibility ages for Social Security to be lowered by one year. In no way would this diminish the benefits of the SS/IRA plan to our economy nor to those who chose the SS/IRA option (whether for education, vocational training, repayment of student loans, a down payment or the refinance of a home).
Chapter 2: VacationHomesMatch.com
This proposal should make some computer savvy person very rich, while they in turn enrich many realtors and bring happiness to the many middle income folks, who yearn for a vacation home just beyond their budget. If the entrepreneur's who started such sites as e-harmony.com have become rich then it follows, as night to day, that a site that brings folks together as partners in a vacation home as owners (rather than owners of a timeshare) should also turn a very nice profit.
Millions of retired folks (living on their pensions and/or nest eggs) desire a winter home in a specific geographic spot where they can escape the cold of winter. They don’t want to be limited to one or two weeks as you are with a timeshare but want to enjoy a month or two (or even several months) in the same vacation locale and same vacation home year after year. And they don’t want to sell their house and move there permanently because they have roots of one sort or another in the northern climes.
Thousands upon thousands cannot afford to indulge this desire in the kind of winter vacation home that they would find suitable to their tastes and comforts. The same applies to teachers and their desire for summer homes suited to their tastes and comforts. Often as not they may be able to afford the price of such a home but need someone to share in the costs of taxes, condo fees, maintenance and repairs. In such buying partnerships as proposed, it would probably be advised that some of the money saved at the outset (by halving the purchase price for each partner) be set aside in an escrow account to cover five to ten year of taxes, condo fees and off-season yard maintenance. This should minimize the risk of friction about money matters during the early years of the partnership. That in turn improves the chances for a successful partnering experience. Success means good word of mouth advertising from happy clientele and nothing is better for business. As the saying goes: success breeds success.
This is how the partner’s sharing would work:
If two partners both want the same months every year (e.g. January - April) it’s written in the purchase contract that:
On Odd years Partner A gets the place for Jan & Feb.
And Partner B for March & April
And on Even years Partner B gets Jan & Feb.
And Partner A gets March & April
Or if both prefer they take turns and A gets the place Odd years and B on Even years for all four months Jan - April.
If it’s a summer season place and both want it June, July & August you offer the same kind of Odd year/Even year options.
Ideally, were the partners well matched they would share the place together for a few weeks or one or two prime months a year. Applying the first scenario where the partners split the season in two: January & February and March & April in odd years Partner A would host Partner B for the month of February and Partner B would reciprocate hosting Partner A for the month of March. This way both get to enjoy the property for three months apiece (two months shared and one month with the unit all to themselves to invite their friends and relatives or just chill out alone). And on shared months the hosting partner could also have additional guests of his or her own. There are surely a myriad of such arrangements that partners can agree to.
It would probably be wise for the entrepreneur's to provide some simple download able forms that the partners can use to put such agreements in writing to avoid later misunderstandings, so the customers remain satisfied and inclined to recommend the service to others.
This is probably more complicated than matching folks on e-harmony as you are matching personalities and real estate desires (though few will give a toot what the partners look like).
These are the key variables that I envision:
1.) Location geographically (e.g. FL West Coast between Naples & Tampa)
2.) Location access wise (i.e. on the ocean, on a golf course, on a marina) or water view, ocean view, oceanfront, bay front, gulf front.
3.) House / Townhouse / Condo / Adult only communities.
4.) Amenities: private swimming pool or common swimming pool, hot tub, spa, boat slips, washer and dryer in unit or on premises, central air, dishwasher, garage parking etc.
5.) Property price range desired: $100,000 - 150,000 or $150k - 200k or $200k - 300k etc.
6.) Smoking/Nonsmoking, Pets/No pets, Rental/No rentals, Friends or family with owner absent /or only with owner.
7.) Preferred part of season: beginning, middle, end.
And then for matching folks up in terms personalities (or of sharing the home simultaneously):
1.) Hours of television enjoyed a week and the need for time out from TV as well as types of shows enjoyed: sports, news, reality, sitcoms, drama, etc.
2.) Cable newscasts: (on a scale of 1-10) Fox News, MSNBC, CNN
3.) Sport casts: (scale of 1-10) NASCAR, NFL, NBA, Golf, Soccer
4.) TV shows: (scale of 1-10) Mentalist, Mad Men, Daily Show, CSI
5.) Interest in cards and/or table games and in quiet time for reading.
6.) Taste in furnishings: twin beds vs. king size, modern or traditional.
I would suggest that you offer this service free to the first hundred or so members so you may amass a membership base worthy of a membership fee to join. Thereafter, charge a fee that represents your processing cost or a fee large enough that it gives the new members a buy in, so they are motivated for a pairing to get their money’s worth. Then charge a larger fee when members are matched. But for the big return on your services charge the real estate brokers a percent of their commission on each pairing you refer to their office and for each time you find a partner for a prospective customer referred by their office. The percent on the commission on those paired with a customer referred by a realtor would be half of the percent charged when you referred both of the partners to the real estate broker.
Real estate brokers will find their relationship with you is so profitable for them, that they shouldn’t begrudge you a generou
s share in their commission. In the meantime, you’ll be enjoying a cut of those fat real estate commissions without ever showing a client a single piece of property. This is a win-win that is going to make a lot of folks rich. If you prefer a more manageable enterprise, you could confine your service to those seeking real estate in one area such as Florida’s West Coast or the State of Arizona and leave millions on the table for other wealth seekers. That would simplify the network of real estate brokers you would have to contact. I’ll be happy whether I make one entrepreneur super rich, or several just rich. Nothing in it for me unless I receive a gift of gratitude from the entrepreneur(s) getting rich. I am encouraging a generous gift of this sort (and the same goes for you partnering realtors as well).
Section II
Private Sector Ideas To Make You Rich
Chapter 3: YachtsMatch.com
YachtsMatch.com is a variation on VacationHomesMatch.com that offers the possibility of comparable riches. Once again there are thousands upon thousands of people who want to own a yacht but cannot afford to buy one and bear the costs of maintaining one (i.e. the fees for a boat slip, or anchorage or dry dock) not to mention fuel and repairs. This population is not limited to the retired and teachers. This population includes everyone who desires a boat. The possibilities for dividing up the ownership are also more versatile than dividing up the use of a vacation home.
Yacht partnership could be serve two - four partners. In a yacht partnership you can divide the month into odd and even weekends (based upon whether Friday is odd or even) or a retired guy like me might be happy to take MTWT and give a working partner the weekends. Or again by odd and even years and months (i.e. Partner A gets the odd months on odd years and even months on even years and Partner B gets the even months on odd years and odd months on even years. I’m sure we can think of other permutations.
Here are what some the key variables would be:
1.) Sailboat, Fishing boat, Speedboat, Cabin Cruiser
2.) Price: 1k- 5k, 5k- 10k, 10k-20k, 20k-30k 30k-50k 50k-100k