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How much is a trillion & US Debt
Old 07-30-2016, 09:24 AM   #1
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How much is a trillion & US Debt

I was watching the news this morning and they were talking about the US debt. Not unusual. Someone made the comment that the current US debt was well over 19 trillion. (>19,000,000,000,000) There's been other threads on this forum on "how much is a million dollars, etc" which I can visualize. Heck I can even get my mind around a billion dollars, but a trillion is hard for me to visualize in my mind. Yes, I know it just a few more zeros added in the right places. So, just for fun, I looked it up and like so many things, I found endless examples. Sorry if this has been discussed before, but if so, maybe a refresher would be interesting to some on this forum.

Here's one of the "many" links I found useful in explaining what a trillion is.



And here's the US debt clock along with a lot of other interesting info.

U.S. National Debt Clock : Real Time
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Old 07-30-2016, 09:28 AM   #2
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Many of those trillions we owe to the fed, so it is artificial debt to some degree and the interest will all be handed back to gov.




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Old 07-30-2016, 10:30 AM   #3
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With a 4% WR, that would be a mere $40B/yr. Could probably ratchet up the spending a tad; maybe even spring for some Gucci accessories...
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Old 07-30-2016, 10:46 AM   #4
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With a 4% WR, that would be a mere $40B/yr. Could probably ratchet up the spending a tad; maybe even spring for some Gucci accessories...
I wonder if the government use a cash back credit card?. Let's see, 2% back on 19 trillion is
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Old 07-30-2016, 11:25 AM   #5
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With a 4% WR, that would be a mere $40B/yr. Could probably ratchet up the spending a tad; maybe even spring for some Gucci accessories...
To get perspective I do things like dividing it by the population.

19 trillion / 320 million = almost 60k of debt per US person.

.. or in context of billionaires: all the worlds 1.800 or so billionaires put together couldn't pay off this debt, but they can make a big dent: 7 trillion roughly.
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Old 07-30-2016, 11:43 AM   #6
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To get perspective I do things like dividing it by the population.

19 trillion / 320 million = almost 60k of debt per US person.
Thats ~ the figure I saw mentioned somewhere the other day. If we could only learn to live within our means, instead of deficit spending and money printing.

I am wondering when the chickens are going to come home to roost, but hope that my family is not around to see what that looks like.
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Old 07-30-2016, 12:07 PM   #7
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To get perspective I do things like dividing it by the population.

19 trillion / 320 million = almost 60k of debt per US person.
I read once that about 47% of US citizens don't pay any federal tax. If that's true, then that means it's really $112k of debt per person who actually pays tax.
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Old 07-30-2016, 12:14 PM   #8
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I read once that about 47% of US citizens don't pay any federal tax. If that's true, then that means it's really $112k of debt per person who actually pays tax.
I think that figure is for income tax. That is about half of the total taxes collected. The other half is payroll taxes, like FICA and Medicare, which are taken directly out of pay checks.
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Old 07-30-2016, 01:01 PM   #9
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20 trillian in national debt sounds real scary until you compare it to the unfunded liabilities of the US gummint. I don't recall the figure, but think in terms of SS and MC as well as Fed pensions (civil and military.) IIRC, the unfunded liabilities dwarf the so-called national debt. (Sort of a "cheer up, the worst is yet to come.") YMMV
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Old 07-30-2016, 01:32 PM   #10
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To get perspective I do things like dividing it by the population.

19 trillion / 320 million = almost 60k of debt per US person.
Many on the ER forum own at least 10 times that much of the US government debt via investment in bonds.
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Old 07-30-2016, 01:42 PM   #11
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Per capita debt is interesting but not meaningful, as public funding is carried out on behalf of and financed by many constituencies, including individuals, businesses and other institutions. This is why economists prefer to look at debt as a percentage of GDP.
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Old 07-31-2016, 07:35 AM   #12
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Per capita debt is interesting but not meaningful, as public funding is carried out on behalf of and financed by many constituencies, including individuals, businesses and other institutions. This is why economists prefer to look at debt as a percentage of GDP.
All quite true - especially if you are an economist. However, putting it in terms of every man woman and child in the US makes it much more quantifiable (IMHO) to the masses. Most folks see the ND going up and have learned to shrug. Thinking of it (whether actually true or not) as one's "share" of the ND tends to "bring it all back home" so to speak. YMMV
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Old 07-31-2016, 07:56 AM   #13
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All quite true - especially if you are an economist. However, putting it in terms of every man woman and child in the US makes it much more quantifiable (IMHO) to the masses. Most folks see the ND going up and have learned to shrug. Thinking of it (whether actually true or not) as one's "share" of the ND tends to "bring it all back home" so to speak. YMMV
I agree and would think most of us would be uncomfortable seeing our personal debt more than double in the past 10 years, while our inflation adjusted income is shrinking. That puts the US debt into perspective for the every day joe.
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Old 07-31-2016, 08:08 AM   #14
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All quite true - especially if you are an economist. However, putting it in terms of every man woman and child in the US makes it much more quantifiable (IMHO) to the masses. Most folks see the ND going up and have learned to shrug. Thinking of it (whether actually true or not) as one's "share" of the ND tends to "bring it all back home" so to speak. YMMV
The problem is that "share" calculation is incorrect, and what it brings back home is a misconception. I'm not advocating any view on the absolute amount, but it seems to me that propagating a view that is flawed serves no positive purpose.
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Old 07-31-2016, 08:46 AM   #15
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I'm on the page that the debt is a serious problem, but one angle that rarely gets discussed is the assets of the US govt. It's questionable how many of them are truly liquid (eg, we would never sell the $13B Ford aircraft carrier or a new $3B nuclear submarine to another country), but the leverage vs. assets may not be as bad as we would think. The interstate system could easily be monetized, etc.

Note that I'm not advocating for any of that, but I wonder what % of annual spending is for something that one might recognize as a capital expenditure and therefore not silly to borrow against.

Borrowing for current consumption is always a bad idea. Borrowing to invest is often a good idea. Clearly our govt budget structure precludes specific insight into "we're borrowing to pay for the aircraft carrier but using current taxes to pay for welfare payments" but it would be interesting to know how it looks in aggregate.

Maybe when I FIRE I will have time to crunch those numbers...
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