Personal and undiluted views
All Stories

“Fiscal Cliff” put in a much better perspective

Tom Winnifrith
Monday 7 January 2013

Thanks to a reader for this which explains why “averting the Fiscal Cliff” has not actually happened. The finances of the US Government are in terms of GDP/Debt ratios pretty much where Greece was just a few years ago. And the trend is not good…

Lesson # 1:

U.S. Tax Revenue: £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 cuts: £38,500,000,000

Let’s now remove 8 zeros and pretend it’s a household budget:
Annual family income: £21,700
Money the family spent: £38,200
New debt on the credit card:£16,500
Outstanding balance on the credit card: £142,710
Total budget cuts so far: £385

Got it? Obama has not. But I reckon most folks can see that the sums do not add up.

There was a lesson #2 attached involving sewerage but I think the point is well enough made already.

Another analogy is with a 20 a day smoker. The budget cuts agreed to date equate to him cutting out one cigarette….a year.

If you enjoyed reading this article from Tom Winnifrith, why not help us cover our running costs with a donation?
About Tom Winnifrith
Bio
Tom Winnifrith is the editor of TomWinnifrith.com. When he is not harvesting olives in Greece, he is (planning to) raise goats in Wales.
Twitter
@TomWinnifrith
Email
[email protected]
Recently Featured on ShareProphets
Sign up for my weekly newsletter








Required Reading

Recent Comments


I also read