Monday, April 15, 2013

Illustrating our debt on tax day

On this tax day, I thought it would be worth illustrating our national deficits and debt. This is what $1,000 looks like--a stack of ten $100 bills rising only millimeters high. I sent almost two of these to Uncle Sam today as my first estimated tax payment of the year. What if we stacked up the debt?

President Reagan used a similar illustration in a speech to Congress just after he took office in 1981 in an effort to build support for spending cuts. He noted, "Our national debt is approaching $1 trillion. A few weeks ago I called such a figure incomprehensible, and I've been trying ever since to think of a way to illustrate how big a trillion really is. And the best I could come up with is that if you had a stack of $1,000 bills in your hand only four inches high, you'd be a millionaire. A trillion dollars would be a stack of $1,000 bills 67 miles high."

That was then (32 years ago!); this is now. Back then, Monty Hall was probably still giving $1,000 bills away on 'Let's Make a Deal.' Nowadays, you can't get $1,000 bills and the debt is much higher. Back then, the national debt was almost $1 trillion, while now we add well over $1 trillion each year. The Federal Reserve has discontinued large denominations of currency due to the lack of need since the rise of checks and electronic banking. Currently, the $100 bill is the largest in circulation, so let's recalibrate.

If you had a stack of $100 bills in your hand that rose 3ft, 4inches high, you'd be a millionaire. A trillion dollars would be a stack of $100 bills rising 670 miles high.
As you can see from the screen capture above, the current US national debt would be a stack of $100 bills rising about 11,256 miles high. For comparison:

+ the world's tallest building in Dubai is just over half a mile high
+ the space station orbits at about 250 miles high
+ the space shuttle could only orbit up to about 400 miles high

Last year, the 2012 annual deficit was $1.1 trillion, which means we added 737 miles to our stack of $100 bills. What does the president think of this? President Obama told congressional leaders, "We have no spending problem." This is outright denial of reality, but it is consistent. After all, we have added 4,824 miles since he took office.