I was always taught to save some money for a rainy day and dang it, it’s not just raining right now it's a perfect economic storm and we need to do something fast! I'm amazed how quickly people are signing this petition because they recognize they recognize the value of freeing up money for strapped families to pay bills.  However, I don't understand why nearly half the people who see this petition don’t sign and share it with others.

The petition isn’t political because it calls on all parties to work together for the public good.  It doesn’t have negative tax impact for the government because income taxes are still withheld from an early withdrawal. It doesn’t put an individual’s retirement plan or the stock market at unnecessary risk because it limits withdrawals to $10,000 per person.  It does however; provide a method for tapping into our savings accounts instead of taking bailout money from the government, which is really just money we borrow form ourselves anyway. 

What we are asking is for the government to stop fighting and allow us to use some of our own reserves to pay our bills for the next 90-days. The only thing that's going to hold us back from recovering from this economic maelstrom is time, hope, faith, and access to our savings, even if it's from our retirement accounts.

You might be skeptical about anything written by a 56 year old man who left the retail banking sector a couple of years ago.  But allow me to draw on my education in finance and economics as well as my experience in banking and lending over the past 30-years to point out a couple of facts.

Fact, the 1980-1982 recessions was actually a double recession within two years.  GDP was at it’s worst at -8.0% in Q1 1980.  GDP was negative for 6 of 12 quarters and unemployment hit 10.8%, which was the highest in modern history. GDP was $6.8 Trillion.

Fact, the 1990-1991 recession was caused by the savings and loan crisis. GDP was negative Q4 and Q1 and unemployment peaked at 7.8%. GDP was $9.4 Trillion

Fact, the 2001 recession lasted 8 months and started with the dot-com bust followed by 9/11. Unemployment rose to 6.3%. Only a few industry suffered catastrophic losses such as the tech and travel industries. Real GDP was $13.3 Trillion

Fact, 2008-2009 is called the Great Recession because it was the worst financial crisis since 1929.  GDP sank 5 quarters with 2 quarters contracting more than 5%, which is greater than any since 1929. At its worst, GDP was -8.4% Unemployment reached 10% September 2009.  The effects of this recession and the economic stimulus injected by the Federal Government and Federal Reserve and debt from prior recessions still haven’t been fully repaid. For instance:
o   The National Debt quadrupled from $5.7 Trillion in 2001 to $22.7 Trillion in 2019.  The really scary thing is debt as measured as a percentage of GDP is a good indication for what’s ahead for us.  A study by the World Bank found that countries whose debt-to-GDP ratios exceeds 77% for prolonged periods, experience significant slowdowns in economic growth.  In other words, lost jobs.

In 2001 the United States Debt to GDP was 43.4% during the dot-com bust and 9/11. It currently stands at a staggering 119% of GDP!  It would take approximately 15-months to pay off the national debt if all of the GDP is dedicated entirely to debt repayment, which is impossible.

The Last time the United States was saddled with so much debt was Post WWII in 1946.  Keep in mind that all during WWII the military industrial complex took up the slack from men going to war by employing women and Class IV military exemptions.  The war also created many small companies that supported the industrial war complex. The economy didn’t stop because of WWII.

What does all this mean? In no time in modern economic history have we experienced a world wide economic shut down.  Sure, there are still people working but by some estimates the unemployment rate may exceed 10%, which was last seen in 1980 and 2008.  None of these two recessions had the same economic impact that this COVID-19 Pandemic is inflicting on the world economy. This time we not only have the same industries now suffering the same consequences as past recessions, such as travel and hospitality but also entirely new ones such as professional sports, restaurants and most service industries where high touch is required to deliver the service.

Freeing up money, without penalty, from retirement accounts is good public policy that everyone should endorse during this unprecedented time.  Please share this petition with your friends and family and let’s make this happen.