Why the Debt Ceiling Fight Is So Fierce
Really now, how serious is this national debt problem?. Figures fly at us like a fleet of locusts. The onslaught of numbers comes from all directions, talk radio, think tanks, politicians and from agencies of the government itself. The size alone makes it impossible to relate.
We have been told how many freight cars it would take to hold a trillion one dollar bills and how many times a trillion dollars worth of sawbucks would go around the world laid end to end. But that doesn’t tell us anything useful; it just shows the numbers are big. We knew that. Then we read about percentages of GDP. What does that mean? How can we relate? How can we make sense of it? We do it by relating expenses and debt to income, not to freight cars or GDP. Our table relates the financial state of the nation to basic family finances.
The government numbers in the table are fixed. Except for Unfunded Liabilities which is an estimate; the figures are reported facts. The family side is a “what-if” table. It answers the question — if a family had an income of 80,000 dollars with spending and debt in the same ratio to family income as the government ratios, where would the family be?
The answer is nearly unimaginable. Such a family would have a half million dollars in outstanding debt, over 600,000 dollars in additional future commitments, no savings and still spending nearly 60% more than they earn. Is it any wonder the rating agencies are prepping us for a downgrade? Is it any wonder why there is a stalemate in Congress when some members, with the backing of the president, actually want to increase federal spending and debt while others insist on cutting both before it’s too late?
If your income is half the 80,000, cut the rest of the numbers on the family side in half. If your income is double, double them. If you have a blog please feel free to take the table and use it as you wish. The more distribution it gets, the better.
Click the table to enlarge it.