Boiling Down the Debt Solution

Someone emailed this to me so this is not mine, but I thought it was simple and effective way to make the point:

The U.S. Congress sets a federal budget every year in the trillions of dollars. Few people know how much money that is so we created a breakdown of federal spending in simple terms. Let’s put the 2011 federal budget into perspective:

*   U.S. income:  $2,170,000,000,000

*   Federal budget: $3,820,000,000,000

*   New debt: $ 1,650,000,000,000

*   National debt: $14,271,000,000,000

*   Recent budget cut: $ 38,500,000,000 (about 1 percent of the budget)

It helps to think about these numbers in terms that we can relate to.   Therefore, let’s remove eight zeros from these numbers and pretend this is the household budget for the fictitious Smith family:

 *   Total annual income for the Smith family: $21,700

*   Amount of money the Smith family spent: $38,200

*   Amount of new debt added to the credit card: $16,500

*   Outstanding balance on the credit card: $142,710

*   Amount cut from the budget: $385

-Billy Ray Valentine

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