I recently read an article that referenced a Jeff Sachs’ article about our federal debt. According to Sachs, in 2000, the US Federal debt was $3.5 trillion, roughly 35% of GDP, Gross Domestic Product. For those not familiar with economics (me), GDP is the monetary value of services and goods. He says that if the debt would have remained at 35% of GDP, our deficit today would be $9 trillion. But it’s not. As of 2022, the US Federal debt is $24 trillion, or 95% of GDP. Where did the additional $15 trillion come from? Sachs references two reports from the Watson Institute, International & Public Affairs, Brown University. The following is a quote from one of the Watson reports; “Through Fiscal Year 2022, the United States federal government has spent and obligated $8 trillion dollars on the post-9/11 wars in Afghanistan, Pakistan, Iraq and elsewhere. This figure includes: direct Congressional war appropriations; war-related increases to the Pentagon base budget; veterans care and disability; increases in the homeland security budget; interest payments on direct war borrowing; foreign assistance spending; and estimated future obligations for veterans’ care.”
Take a moment and think about how much is $1 trillion. When the Powerball lottery got to $1 billion, it’s hard not to think about, what would it be like to win $1 billion? That is $1,000 million. A million dollars times 1,000. Even if you took the one-time cash payout, it would be a little over $500 million. How much is $1 trillion? It is 1,000 billion dollars. That is 1,000 piles of one billion dollars in each pile. It’s easy to lose track of how much money we’re talking about when we start discussing federal debt. Anything over $100,000 sounds like a lot to me. It’s hard for me to think in terms of millions of dollars, or billions of dollars. But trillions? That’s a lot of cash.
