Why S&P Downgraded U.S. Debt
I found this interesting and thought it might help understand not only why S&P downgraded U.S. debt, but the basic nature of the problem of the U.S. government's finances.
Now let’s remove 8 zeros and pretend it’s a household budget.
Source: www.jsmineset.com
• U.S. Tax revenue: $2,170,000,000,000
• Fed budget: $3,820,000,000,000
• New debt: $ 1,650,000,000,000
• National debt: $14,271,000,000,000
• Recent budget cut: $ 38,500,000,000
• Fed budget: $3,820,000,000,000
• New debt: $ 1,650,000,000,000
• National debt: $14,271,000,000,000
• Recent budget cut: $ 38,500,000,000
Now let’s 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: $385
• 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: $385
Source: www.jsmineset.com
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