Putting the Size of the National Debt in Perspective

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August 29, 2011

In a recent story for NPR News, Linton Weeks points out Americans’ increasing comfort with the word trillion.   In the past, this number was only used for things that seemed unimaginably vast, like cells in the human body or stars in the visible universe.  However, in modern fiscal discussions, “If you’re not talking trillions, you’re talking chump change,” Weeks contends.  From the article:

The national debt is more than $14 trillion. In a recent report, the credit rating agency Moody’s says the 1,600-plus U.S.-based companies it rates harbored some $1.2 trillion in cash at the end of 2010. The newly minted congressional supercommittee is charged with finding ways to pare the federal deficit by at least $1.2 trillion in the next decade.

Weeks says that our comfort with this number is the result of positional arithmetic, our everyday notational system.  He cites 19th century mathematician Pierre-Simon Laplace who wrote that the “method of expressing all numbers by means of 10 symbols” is “so simple to us now that we ignore its true merit.”  Using this notation system, changing 1 million to 1 billion only requires the addition of three zeros.  Completing the same task using Roman numerals, Weeks writes, would require “1 million Ms – roughly 1,000 pieces of paper filled with Ms!”

The ease with which we transition from millions to billions to trillions means that “pretty soon we’re talking surreal money.”  Weeks concludes with several examples that help put these numbers in perspective:

To spend $1 trillion in the average American life span of 77 years, you will have to shell out about $35,580,857 every day… One trillion seconds add up to 31,688 years, The Associated Press points out… In a 1981 address, President Reagan explained to Congress that a stack of a trillion $1 bills would be 67 miles high.

Even with these examples, the size of these numbers can be mind-boggling.  Teachers should help students put these numbers in perspective as they discuss the federal budget deficit and national debt.  Students should be encouraged to discuss whether or not the examples given above are beneficial in discussions of fiscal policy.  While $1 trillion is a nearly unimaginable amount of money for an individual, is it unimaginable for an entire country?  What additional information would you need to answer that question?  Where would you go to find it?

Teachers could use this article to introduce concepts like gross domestic product and debt-to-GDP ratio.  Students in US history classes could examine the United States’ history of deficit spending and compare our current debt-to-GDP ratio with that of other decades.  World history or global studies students could compare the United States debt-to-GDP ratio with that of other countries (in the past or the present).  These lessons would help students understand the size of our debt in relation to comparable elements of similar magnitude.  While it is important that students understand the true size of the national debt, it is also important that they understand how that number relates to other economic indicators.

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