Tuesday, August 25, 2009

One more try

Curmudgeon politely pointed out in a comment that I added some extra zeros in my deficit sharing figure in the last post – to the tune of three. (It continually amazes me that I scored in the 99th percentile in math tests back when I was a kid – I guess having four answers to choose from takes away from the tests’ predictive value.)

With some further research, it turns out that zeros and long division weren’t my only problems.

According to brillig.com, the current “outstanding public debt” is $11.734 trillion, and some change, or $38,247.47 per person, based on a current population of 306,799,856 as of 6:22 p.m. GMT today.

If you add the projected $9 trillion increase in the deficit over the next ten years giving a total debt of a bit less than $21 trillion in 2019 we are in the neighborhood of $70,000 per person (using a 310 million population number).

Some more: In 2004 (the only year I could find a number for) the net worth (assets minus liabilities) of the median family in the country was about $93,000. I found various numbers for the number of people in a family just above and below 3. Using an average 3.2 people for a “family,” the total net worth of the U.S. population is about $8.8 trillion, $2.9 trillion less than the current deficit. Folks the country has a negative net worth. (Given our recent financial meltdown, I’m assuming the median family net worth has dropped from $93k given the dive in 401K's, house values, etc., giving even grimmer results.) Even assuming a return to economic stability over the next ten years we should still have a negative position. Put a different way, if we return to where we were in 2004 when things were perking along, but run up another $9 trillion in debt, our negative net worth should approach $12.2 trillion.

I’m thinking “baby boomer” will be a cuss word in about ten years. Throw in Medicare and social security underfunding that no one is really talking about. Generational warfare?

7 comments:

Lifehiker said...

There are some doomsday scenarios associated with this. Europe is just as bad, or worse.

China may run the world by 2050, simply because they will own everyone.

Kvatch said...

I’m thinking “baby boomer” will be a cuss word in about ten years.

Being born in the "official" last year of the Boomers (1964, though some say that's really 'Generation Jones'), I would like to petition for admittance to GenX.

Dave said...

Only if you have money Kvatch.

molly gras said...

Yikes! What a Debbie Downer ... :-(

And Lifehiker, based on your prediction, it makes me awfully glad that I have a passing familiarity with Mandarin Chinese ...

Posol'stvo the Medved said...

"I’m thinking “baby boomer” will be a cuss word in about ten years."

Try ten *minutes*, you BABY BOOMER!

The Curmudgeon said...

Yup.

We went from the "Greatest Generation" to the "Me Generation."

And our children and grandchildren will pay the price.

Unless....

Remember Malthus? Malthus wasn't wrong when he predicted mass starvation -- he just couldn't anticipate new agricultural technology that has allowed the world to support billions more than he dreamed possible.

We get too gloomy projecting the debt out.

This doesn't mean spend heedlessly -- adopting H.R. 3200 or some similarly reckless plan -- and the trillions in additional debt be damned.

But it does mean that we have to continue to innovate -- else Lifehiker will surely be proved correct.

My personal belief is the manned exploration and exploitation of space can jumpstart our economy in ways that we can only imagine now.

Give me something better, or more likely, and I'll consider it. But that's my proposal.

ThomasLB said...

I don't trust anyone under 30.