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National Debt in Layman’s Terms
Many Americans are feeling out of touch with the recent squabbles over our national debt ceiling, federal budget, and debt levels. It’s tough to accept that “trillion” is the new billion; let alone grasp the concept of “trillions of dollars”.
So let’s breakdown the 2011 federal budget into terms that we can all understand:
Our current federal budget numbers:
| U.S.Income (Revenue) | $2,170,000,000,000 |
| U.S.Federal Budget (Expenditures) | $3,820,000,000,000 |
| New Debt (2011 Revenue minus Expenditures) | $1,650,000,000,000 |
| National Debt | $14,610,000,000,000 |
| Spending cut from debt limit deal | $38,500,000,000 |
Now, if we remove some zeroes and make this a family budget, how would this family be faring?
| Total annual income for family: | $21,700 |
| Amount of money family spent this year: | $38,200 |
| Outstanding balance on family’s credit card: | $146,100 |
| Amount family decided to cut from their budget: | $385 |
Would a family that spends $16,500 more than it makes, and with a credit card balance of $146,100, address the problem by only cutting the equivalent of mom’s monthly pedicure?
A 1% trimming is a small start, but certainly not a solution.
Sources: http://en.wikipedia.org/wiki/2011_United_States_federal_budget, US Treasury Dept., concept by David Thomas, Equitas Capital Advisors LLC
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