How Much is Ten Trillion Dollars, Really?

One of tomorrow's leaders nails it: "You're foolin' me again, Unca Ron! There's no such thing as a trillion dollars!" In your heart, y'know she's right!

$10,000,000,000,000.00 sounds like a lot of money -- but every statistic in Major League Budgetball sounds like a lot of money. Just how much is $10T, in everyday terms?

(a) A lot of money
(b) A whole lot of money
(c) A docking shipload of money

It's not the sort of question most of us have to deal with every day.

Here's one way of bringing it down to personal scale. There are roughly 100 million households in the USA. $10,000,000,000,000 divides out to $100,000 per household. (If you live in a nicer-than-average house, help yourself to a bigger-than-average slice of the negative pie.)

Here's a more concrete benchmark: the replacement cost of America's housing stock -- every house, duplex, condo, apartment and trailer, from sea to shining sea -- is roughly $10T.

Picture your home swept away by some natural disaster -- right down to the last foundation block. Picture your neighbor's home, likewise, and everybody's home.

Picture Mr. and Mrs. America crawling out from the rubble, surveying the damage, trucking down to Home Depot for load after load of bricks and boards, rolling up their sleeves and investing the sweat equity it takes to put things back the way they were. That's a ten trillion dollar job.

Look at it another way, as the Concord Coalition's Pete Peterson did in recent congressional testimony: "In just two years, America has witnessed a $10 trillion projected deficit swing".

We went into the tax cut debates of 2001 projecting a ten-year surplus of 5.6 trillion dollars. Today's Congressional Budget Office projections put us a couple trillion in the hole. Account for the sure things not yet reflected in CBO figures -- AMT relief, fully-funded homeland defense, reasonable costs of occupying Iraq, realistic costing for continuing programs -- and we're more than $4T in the red.

That's a ten trillion dollar reversal in federal fortunes, and we have set nothing aside for prescription drug benefits, Social Security reform, full-scale Missile Defense, or anything unexpected. A year or two later, the boomer bulge hits retirement.

This $10T is not some abstract notional account. It is a real lifetime legacy burden on real taxpayers, and it's as big a burden as building everybody's home over again.

Who gets to pay the piper? And when? I'll take that up shortly. (Hint: The news is worse than you think.)

RonK, Seattle

Posted May 23, 2003 01:01 AM | Comments (123)