Really high numbers are being casually thrown about these days. Who really understands just how much these numbers represent?
Yesterday, on the news, I heard a comparison to explain the scope of a trillion dollars: If you had the earnings of 4,000 Oprah's, you would have a trillion dollars. That's a lot of money.
Then I checked the Net:
What is a trillion dollars?
Filed under:Money, Banking, The Fed, IMF
September 17, 2003 - 22:55
What's a trillion dollars?
A trillion dollars = $1,000,000,000,000.
That's 12 zeroes to the left of the decimal point. A trillion is a million million dollars.
The U.S. government spends more than the entire Gross Domestic Product (GDP) of Australia, China and Spain combined. If you laid one dollar bills end to end, you could make a chain that stretches from earth to the moon and back again 200 times before you ran out of dollar bills! One trillion dollars would stretch nearly from the earth to the sun. It would take a military jet flying at the speed of sound, reeling out a roll of dollar bills behind it, 14 years before it reeled out one trillion dollar bills.
What is frightening is that government will continue to grow in America unless citizens prevent it. If government stays on the course it's been on for the past forty years without a radical change, the federal government will have a $10 TRILLION BUDGET by the year 2010.
Foolish politicians make pronouncements about the strength of the economy. The total debt obligation of the United States now exceeds 46 TRILLION DOLLARS.
American workers now net almost 30 percent less in real wages than they did in 1973. After taxes, two paychecks in a family barely equal the purchasing power one had thirty years ago.
WHAT'S A TRILLION?
LET'S PUT THE AMOUNT OF THE US NATIONAL DEBT INTO PERSPECTIVE
$ 7,937,463,000,000.00
Seven trillion, nine hundred and thirty seven billion, four hundred and sixty three million dollars
If you had gone into business on the day Jesus was born, and your business lost a million dollars a day, day in and day out, 365 days a year, it would have taken you until October 2737 to lose a trillion dollars.
The U.S. Congress has done seven times this damage to their constituents in a little over eighteen years!
----STATISTICS----
It now (2001) takes more than all of the income taxes collected just to pay the 'debt service' (interest) on the national debt, and it is estimated that, at the present rate of national debt increase, it will have grown to 18.28 trillion dollars by the year 2006.
With a 242% increase in the debt and no more income taxes left to pay the debt service, how do you suppose our children and grandchildren are going repay this enormous debt that every American today is leaving them?
If you ventured a guess that they'd be taxed at about 73%, you would be pretty close.
What's a trillion?
What's a trillion?
"Out, damned spot! out, I say!"
- William Shakespeare, Macbeth, 5.1
What's a trillion?
it is amazing, I have never heard the words 'Billions and Trillions' roll of people's lips so easily like in the past few months.
What's a trillion?
We use US notation for billions and trillions now, (as opposed to the older english ones).
A billion is a thousand million or 1 (x 10 to the power of 9) in scientific notation.
A Trillion is a thousand billion (a truly astronomical figure) and thats 1 (X 10 to power of 12)
So on current estimates US debt is somewhere between 7.5 and 10 thousand billion dollars (depending on what you included in the debt calculations, they tend to leave certain things out).
The US economy is about 14 Trillion dollars annually, so economists tend to look at the debt as a function of the economy, of course in recession the size of your economy contracts, but your debts do not (unless you have had them raised in your own currency and you allow the value of your currency to decline).
Its hard to get your heads around all of these numbers that are flying around, what essentially is the point is that in general, all Western Nations are massively in debt both publically and privately, have in some instances de-industrialized and instead relied on providing financial services and the construction sector to fuel our economies, so now we are dependent on Asian and Private capital markets to keep ourselves funded for the forseeable future. Its an invidious position, and how it quite got to this?
Well to my mind its the result of blindly believing in an economic ideology called "neoliberalism" as well as the erosion of civic and personal responsibility that has overwhelmed us across all Western countries in recent times. These two things are deeply intertwined, we have lost perspective about what our responsibilities as citizens actually are, which are not to be confused with our rights as individuals (either economic or political), which are enshrined by our observance of a mutally agreed set of laws we are all supposed to live by. This has happened both on an individual level, and also on a governmental level, where many governments seem to have lost the sense that they are elected to rule their nations in the interest of all citizens, and not just to facilitate business and capital interests.
Neoliberalism is the idea, that essentially, by definition, the more aspects of life you leave to be valued by private market forces, the more realistic will all asset and transactions be valued at, and that will in the long run provide for very robust, healthy economies, and also a concurrent increase in basic liberty as the power of public governance is seen as something invidious to human freedom.
Now of course we can see quite cleary in recent months, that there have been massive market failures in banking and capital markets all across the world. The reactions of most governments has been to realize that in fact at the end of the day, it is Government and its ability to tap tax payers as a source of capital to make up for the losses of private captial that is really the lender of last resource when all else fails.
You see, there is a disconnect.
The edifice of capitalism is based on the rule of law, the civil and commercial law that stands over all requirements to fulfill all contracts and transactions. But in a democracy, the rule of law is a public issue, the madates of governments to legislate is given by citizens, the independence of the judicary to adjudicate on legal matters is enshrined in public law (usually a constitution), and the money to pay police, soliders, and prisons to make sure the law is enforced is raised by taxing citizens.
However, part of the philosophy that has been adopted in recent years is something called "self-regulation" this is the idea that governments and regulators have allowed banks, financial houses and other "wealth creators" to essentially regulate themselves, and basically self-certified and audited their businesses.
This is not the case for ordinary people of course, and you can imagine what would happen if ordinary people were allowed to "self-regulate" themselves. Yet this has been what has been done in the financial sector for years, based on the allure of the neoliberal philosophy. It is an anaethma to the concept of a Republic that you would allow one section of the citizens (i.e. banks), to self-regulate, while everyone else has to observe the law.
The results are all too predictable, and we are living with them now. Some people believe its been politicans interfering with free markets that have created this situation, some believe its because that free markets (when they become completely unregulated) turn into economic doomsday machines that eventually accure all capital to the wealthy while impoverishing everything and everyone else, and other believe that its because we have created a global economy by accident and not really thought through how it works or what the consequences would be if it stopped working.
I tend to think its a bit of a mix of all three.
What I do know is that we are now in terrible trouble, worldwise, the system has completely blown itself apart, and we need some radical solutions to get out of it, and those solutions will have to be global, and radical, otherwise we are going to witness an unprecedented economic collapse.
A billion is a thousand million or 1 (x 10 to the power of 9) in scientific notation.
A Trillion is a thousand billion (a truly astronomical figure) and thats 1 (X 10 to power of 12)
So on current estimates US debt is somewhere between 7.5 and 10 thousand billion dollars (depending on what you included in the debt calculations, they tend to leave certain things out).
The US economy is about 14 Trillion dollars annually, so economists tend to look at the debt as a function of the economy, of course in recession the size of your economy contracts, but your debts do not (unless you have had them raised in your own currency and you allow the value of your currency to decline).
Its hard to get your heads around all of these numbers that are flying around, what essentially is the point is that in general, all Western Nations are massively in debt both publically and privately, have in some instances de-industrialized and instead relied on providing financial services and the construction sector to fuel our economies, so now we are dependent on Asian and Private capital markets to keep ourselves funded for the forseeable future. Its an invidious position, and how it quite got to this?
Well to my mind its the result of blindly believing in an economic ideology called "neoliberalism" as well as the erosion of civic and personal responsibility that has overwhelmed us across all Western countries in recent times. These two things are deeply intertwined, we have lost perspective about what our responsibilities as citizens actually are, which are not to be confused with our rights as individuals (either economic or political), which are enshrined by our observance of a mutally agreed set of laws we are all supposed to live by. This has happened both on an individual level, and also on a governmental level, where many governments seem to have lost the sense that they are elected to rule their nations in the interest of all citizens, and not just to facilitate business and capital interests.
Neoliberalism is the idea, that essentially, by definition, the more aspects of life you leave to be valued by private market forces, the more realistic will all asset and transactions be valued at, and that will in the long run provide for very robust, healthy economies, and also a concurrent increase in basic liberty as the power of public governance is seen as something invidious to human freedom.
Now of course we can see quite cleary in recent months, that there have been massive market failures in banking and capital markets all across the world. The reactions of most governments has been to realize that in fact at the end of the day, it is Government and its ability to tap tax payers as a source of capital to make up for the losses of private captial that is really the lender of last resource when all else fails.
You see, there is a disconnect.
The edifice of capitalism is based on the rule of law, the civil and commercial law that stands over all requirements to fulfill all contracts and transactions. But in a democracy, the rule of law is a public issue, the madates of governments to legislate is given by citizens, the independence of the judicary to adjudicate on legal matters is enshrined in public law (usually a constitution), and the money to pay police, soliders, and prisons to make sure the law is enforced is raised by taxing citizens.
However, part of the philosophy that has been adopted in recent years is something called "self-regulation" this is the idea that governments and regulators have allowed banks, financial houses and other "wealth creators" to essentially regulate themselves, and basically self-certified and audited their businesses.
This is not the case for ordinary people of course, and you can imagine what would happen if ordinary people were allowed to "self-regulate" themselves. Yet this has been what has been done in the financial sector for years, based on the allure of the neoliberal philosophy. It is an anaethma to the concept of a Republic that you would allow one section of the citizens (i.e. banks), to self-regulate, while everyone else has to observe the law.
The results are all too predictable, and we are living with them now. Some people believe its been politicans interfering with free markets that have created this situation, some believe its because that free markets (when they become completely unregulated) turn into economic doomsday machines that eventually accure all capital to the wealthy while impoverishing everything and everyone else, and other believe that its because we have created a global economy by accident and not really thought through how it works or what the consequences would be if it stopped working.
I tend to think its a bit of a mix of all three.
What I do know is that we are now in terrible trouble, worldwise, the system has completely blown itself apart, and we need some radical solutions to get out of it, and those solutions will have to be global, and radical, otherwise we are going to witness an unprecedented economic collapse.
"We are never so happy, never so unhappy, as we imagine"
Le Rochefoucauld.
"A smack in the face settles all arguments, then you can move on kid."
My dad 1986.
Le Rochefoucauld.
"A smack in the face settles all arguments, then you can move on kid."
My dad 1986.