The Leviticus 25 Plan will deliver substantial liquidity to individual Americans at the family level – providing U.S. citizens with direct access to the Federal Reserve Discount Window (“Fed Window”). This direct access will permit American families the same privileged access that was granted to Goldman Sachs, J.P. Morgan and other major investment banking conglomerates whose high-risk blind bets on Mortgage Backed Securities (MBS) and under-capitalized derivatives triggered the U.S. financial crisis in the fall of 2008. Numerous foreign banks have also been granted access to near-zero percent interest rate funds at the Fed Window – again at either direct or indirect U.S. tax-payer expense.
American citizens themselves deserve nothing less than the same direct access to the Fed Window.
The Leviticus 25 Plan will provide American families the opportunity to directly manage the resources that government has heretofore been attempting, and failing, to manage effectively on their behalf.
The Plan is voluntary – participation is not mandated by government.
1. $64,000 per U.S. Citizen Participating American families would qualify for a direct credit extension from the Federal Reserve amounting to $64,000 per family member. 75% of the total would be directed into a Family Account (FA) and 25% of the total would be directed into the family’s Medical Savings Account (MSA).
To activate their participation in The Leviticus 25 Plan, individual families would be required to open up the two qualified accounts (FA and MSA) at an authorized bank or financial institution of their choice. Participants would be required to prove U.S. citizenship. They would be required to acknowledge that they understand and agree to the liquidity recapture provisions of the program. And they would be required to name beneficiaries for their accounts and select any other specific options for disbursements available within the plan.
A family of 4, for example, upon opening their two qualified accounts would receive an electronic credit extension from the Federal Reserve of $256,000. 25% of the total ($64,000) would be deposited into the family’s Medical Savings Account, and 75% of the total ($192,000) would be deposited into the Family Account.
This targeted credit extension from the Federal Reserve is critical to providing liquidity infusions and debt relieve to American families – and solving America’s financial crisis.
The Plan would prove, over the long run, to be less costly and more effective than the current course of massive social welfare spending programs and unbridled fiat money printing.
A targeted, family-level liquidity solution is the ideal way to promote economic liberty, revitalize economic growth and end the economic crisis.
The Leviticus 25 Plan should be America’s top economic priority.
2. Medical Savings Account (MSA) $16,000 of each $64,000 (or 25% of the total credit extension per family) would be directed into a Medical Savings Account for that family. Participating qualified accounts, opened through banks and other financial institutions (credit unions), would be required to offer a high-deductible (e.g. $5,000 – $10,000 deductable per family) major medical health insurance policy. Such plans may be either stand-alone plans, or they may be set up to work in concert with current employer-provided coverage, with employers offering to share cost savings via employer-based MSA contributions, contingent upon cost savings from individual high-deductable policies.
Qualifying major medical policies must provide basic coverage, with freedom for families to add coverage riders (e.g. alcohol treatment coverage, mental health counseling, etc.), only as desired on a family-by-family basis. Policies would not be automatically ‘loaded’ with expensive government healthcare mandates.
Premium costs would be significantly lower with the high-deductible feature and the elimination of expensive government mandates.
Families would pay directly (MSA debit card) for normal medical purchases graduated up from $5,000 per single family member, for example, to $10,000 per family of four (or $15,000 for a family of six). There would be no government bureaucracy to ‘manage’ the people’s health care. Insurance coverage would ‘target’ major medical expenditures above and beyond the deductable ‘trigger.’ Reductions of high-volume, minor insurance claims over such a wide scale, medical costs would drop significantly, and the direct patient-provider relationship would be restored. Medical professionals would not have to answer to HMOs, insurance companies, or government agencies in providing basic day-to-day healthcare access for their patients.
Those with extraordinary medical issues may be included in a high-risk category – such plans would be eligible for moderate government subsidy (similar to current Medicare Advantage).
Individuals enrolled in Medicare / Medicaid / FEHB / VA programs would be required to pay an annual deductible ($2,500 per year per enrolled family member) for a period of five years for those benefits. Dedicated MSA funds would provide more than adequate offset for the higher deductible. MSA funds could also be used to pay Medicare supplement premiums and other potential co-pay obligations.
3. Family Account (FA) 75% of a family’s credit extension (or $48,000 of each $64,000 per family member) would be deposited into the Family Account. There would be no income tax assessed on the credit extensions received under The Leviticus 25 Plan.
And there would be no penalty (reduction of Leviticus 25 Plan funds) for additional new income earned by family members. Incremental installments (quarterly or semiannually) may be required for those with unremarkable (poor) credit / job histories – father than a full disbursement of funds to the FA during the initial funding phase.
4. Recapture provision – Income tax refunds Those individuals / families choosing to participate in the Plan would agree, under the Recapture Provisions, to give up their individual income tax refunds may choose not to participate if their anticipated income tax refunds substantially exceeded the value of the plan benefits.
Income tax obligations each year of the five-year period would be maintained at a level not less than the average sum of income tax withheld for each year of the past 3 years prior to plan’s inauguration date, or the average sum of taxes paid annually for the past 3 years prior to the plan’s inauguration date – whichever is greater.
For example, if a family of 4 had $5,000 in income tax withheld, on average, each of the past 3 years, and received an average of $2,500 refund each of those 3 years, the tax obligation for this family would be not less than $5,000 per year. Taxes beyond the $5,000 average would be owed only if/when additional new income, in an improving economy, triggered a higher tax obligation.
Where an individual or family paid more income tax than that amount withheld on one or more of the past 3 years prior to the plan’s inauguration date, and the average for total taxes paid exceeded the average for income taxes withheld, then the tax obligation would be the greater average. Again, total income taxes paid may be more, based upon additional income earned.
The Plan assumes that government would not impose unanticipated new tax obligations which would undermine the commitments to and major benefits of the Plan.
Funds deposited in the Family Accounts of participating U.S. citizens would be “protected” from any legal confiscation by creditors or courts. Any funds withdrawn from the Family Account would be allowed to be repatriated within 30 days to retain “protected” status. Additional deposits into the Family Account, above and beyond the original Leviticus 25 Plandeposit, would not be permitted under The Plan.
Funds deposited in the Medical Savings Accounts of participating U.S. citizens would also be “protected” from any legal confiscation by creditors or courts. Additional pre-tax deposits into MSAs would be allowable annually in amounts authorized by law.
5. Recapture provision – social program / general welfare benefits curtailed Participating families would give up benefits from means-tested welfare programs, income security programs, and unemployment insurance benefits for a minimum of 4 years. See full listing of individual program in these categories in FAQ section 6.
Participants concurrently enrolled in Medicare / Medicaid / FEHB / VA health benefit programs would be required to pay an annual deductible of $2,500 per year per enrolled family member for a period of 5 years. MSA funds would provide more than adequate offset the higher deductible. MSA funds could also be used to pay Medicare supplement premiums and other potential co-pay obligations.
6. State and Federal Institution provisions (nursing homes, assisted-living centers, jails, prisons, other) U.S. citizens who are institutionalized under direct government-sponsored care (residing in nursing homes, assisted-living, prisons, jails or other such facilities) do qualify for participation in The Leviticus 25 Plan. The credit extension funds for those citizens would be held in a custody account in the individual’s name at that institution. The federal, state or local government jurisdiction involved would determine a fair monthly charge to that account for living expenses involved – as long as the person remained in such a facility.
Individuals being granted release or discharge from the participating institution qualify for receipt of the balance of funds (not subject to further Medicaid repayment obligations) which were held in that person’s name in the custody account, with such funds being then transferred into a Family Account (75%) and a Medical Savings Account (25%).
7. Eligibility Eligible families must be citizens of the U.S..
Minors who are citizens are eligible for participation. Parents or legal guardians (U.S. citizens) of eligible minors would act on behalf of the minors in receiving and managing funds in the Family Account and MSA account of that family. Proportionate funds may be may be transferred into qualified accounts on behalf of a minor subsequently turning 18.
Additional guidelines would specify the receipt and management of funds where the parent(s) or legal guardian(s) of eligible minor(s) is/are not U.S. citizen(s).
All new-born baby U.S. citizens, born to U.S. citizen parents within 9 months of the program closing date, would be eligible.
The Leviticus 25 Plan would be voluntary for eligible Americans. No eligible person or family would be forced to participate.
8. Cost The Leviticus 25 Plan one-time credit extension to American families would generate a Federal Reserve balance sheet expansion of approximately $15.4 trillion.. See FAQ for further details.
Recapture provisions would yield a return of approximately 9-10% ($1.6 trillion) per year – leading to an estimated $8.0 - $8.1 trillion recapture over the 5-year period. A proportionate amount of the excess reserves (recaptured tax revenues and reduced social spending) would be transferred back to the Federal Reserve each year to systematically reduce the size of the Federal Reserve balance sheet.
Additional revenue gains for the U.S. Treasury, as well as for state and local government entities, would begin immediately and would be significant. The private sector economy would quickly ‘reflate,’ retail sales would improve, existing jobs would be saved and new jobs created– all directed from the private market allocation of resources.
Case Study #1 Family of four. Father and/or mother laid off from their jobs – living on food stamps, unemployment extensions, and other means-tested welfare programs.
Under The Leviticus 25 Plan, this eligible family may voluntarily ‘enroll’ in the plan with a bank / financial institution of their choice (for their family’s $256,000 credit extension). An account would be set up for the receipt of the $192,000 in their ‘Family Account.’ An attached Medical Savings Account (with an $8,000-10,000 deductable major medical policy attached to the account) would receive a deposit of the remaining $64,000 for the family.
In return, the family would forego any tax refunds for a period of five years. Their annual tax obligation during the five-year period would be the average amount of taxes withheld over the previous 3 years – or the average amount of taxes paid over the previous 3 years – whichever amount was greater. Income tax obligations beyond the applicable average would be owed only if additional new income, in an improving economy, triggered a higher tax obligation.
The family would also give up primary benefits from federal and state means-tested welfare benefits, income security programs, unemployment insurance, workman’s compensation for a period of 5 years. There would be an additional $2,500 deductible per family member for any Medicaid, Medicare, VA, FEHB eligible expenses each year of the succeeding 5 year period.
A family of four (with $192,000 in their ‘Family Account’) would then have $38,400 per year for health insurance policy which they would ‘manage’ themselves.
Case Study #2 Elderly person living alone on Social Security and modest retirement income – Means-tested welfare benefits and income security benefits are significant, amounting to more than $64,000 over a 5-year period. This person would likely thereby choose not to participate in The Plan.