This is exactly the wrong sort of visualization. It provides no information other than "big number is big, lol."
The US debt is a big number. So big that people have a hard time wrapping their head around it. They need a point of comparison. So what's a good point of comparison for the US debt? Hmm... we could use the federal budget, or GDP, or the world GDP, or the debt of other large nations. Or we could break it down per capita, and compare it to other per-capita things, like income or tax burden. Or... I know! We can convert the thing to hundred dollar bills, and put it next to the statue of liberty! That's a meaningful comparison!
It provides no information other than "big number is big, lol."
As an accurate, useful comparison it falls short, and there's a political agenda behind it (I hate politics, yet I'm commenting). But people don't regularly wrap their brain around how big a trillion really is. Had the site used sticks, marbles, pebbles or even an illustration related to time, it would have been useful. I remember as a child being taught the difference between a million and a billion in that manner and it was important to my relative understanding of numbers. Most people don't work with big numbers all day and could gain something from just that simple point ... big numbers are big.
It's dishonest, though, and reminds me of why I hate politics. At university, I had a philosophy professor who argued injustice by comparing the percentage of African-Americans on death row vs. other nations of origin, to the percentage of the African-Americans in the US population vs. other nations of origin. He provided those two numbers and much of the class was shocked. The problem is that the US doesn't pick random citizens to be on death row, it picks citizens who are convicted of capital crimes. A more honest comparison (and, still yet, illustrative of the point, though less dramatic) would be to compare the number of African-Americans convicted of a capital crime and sentenced to death with the same rates of other minority groups (or even against everyone else as a whole would be an improvement), and then, of course, diving into conviction rates, reasonably provable false conviction rates and the host of other variables that enter into an imperfect system that is imperfect because human beings are imperfect.
EDIT: Improper use of asterisks. Tsk Tsk. Corrected my description of the professor's comparison by adding "vs. other nations of origin" since that's more accurate.
Agreed. This visualization is only interesting to someone obsessed with the physical size of paper currency.
Planet Money recently did a nice job of comparing the current U.S. debt level and the historic debt levels of other countries to GDP, and how that impacted their economic fate:
People have physically handled $100 bills and visited the WTC and Statue of Liberty.
You want to explain abstractions in terms of concrete things like this, rather than in terms of other abstractions. And "GDP" is as abstract as it gets.
The statue of liberty/wtc is somewhat of a silly point of comparison for national debt but grounding numbers into something familiar or in this case physical objects is quite telling for most people. Even if your point of comparison is "the federal budget/GDP/world GDP/debt of other large nations" it goes back to the same issue where you are comparing large numbers to other large numbers which is meaningless to most people(outside of HN). I wouldn't use this type of visualization to brief congress but it is telling.
I agree although I think this sort of visualization does provide some perspective of how much "trillion" actually means which can be hard to grasp when just seeing the zeroes.
Not a particularly useful exercise. Imagine 100 years from now we've maintained the same debt level. This graph will show just as much information (big numbers are big!) as it does now, but the analytical value of it (if it exists now) will obviously be totally dissipated, as we'll be an order of magnitude richer.
A better comparison would be to take a single person, and put the per capita amount of debt in $100 bills next to them. If you want to get really histrionic, do it with a baby. Still, it won't come up past the ankles (around $15,000).
This isn't a small amount, but at the same time it's not the end of the world. My college loans come out to that amount, and I barely notice paying them monthly.
It's equivalent to having a mortgage-sized to around five times your annual income. An annual income that typically grows 2.5% a year and comes with a machine that prints out money whenever you need it.
Edit: typo in Google search, it's more like $50k than $15k. So a bit worse than that analysis would suggest.
A better comparison would be to take a single person, and put the per capita amount of debt in $100 bills next to them. If you want to get really histrionic, do it with a baby. Still, it won't come up past the ankles (around $15,000).
For that graphic to be any use at all, it needs to show the size of the US economy in comparison.
A $400,000 home loan looks pretty big if you visualize it in 1 cent pieces, but if you put it next to a $100,000 salary it looks pretty reasonable.
"US Unfunded Liabilities" is a stupid thing to measure anyway. That's like putting all your household expenses for the next 30 years on mortgage graph. Yes, you will need to pay them, but they aren't a debt at all.
The point is they're unfunded: we don't know where the money is coming from, short of raising taxes or printing more. It's like putting the kids' college educations on a graph and realizing there's no current or future income/savings to cover it.
The sites creator should watch themselves suggesting people click on the adverts... Good chance they won't end up with the payments, as this breaks nearly all PPC companies ad rules...
It would have made sense to compare that to total GDP or something other than a building, I find it kind of useless as it is. It's big but seriously you're talking about the largest economy in the world. I don't get all the irrational fear this is supposed to engender in the mind of people.
Visualizations are never meant to be rational. What they can do, if effective, is over rule other irrational judgments. For instance, I'd contend your view (that the debt is no big deal) is irrational. Had this worked on you it would have at least gotten you to admit it is a big deal.
Just so I don't get accused of making ad hominems let me explain my contention above. You seem to think the size of the debt isn't a big deal because it is small compared to GDP. That would be an effective argument if the question was "will the U.S. go bankrupt"
But when people are assessing how big a problem the debt is the question they are asking is how much it will impact our overall standard of living when we inevitably have to start paying it off. So how big it is in comparison to GDP isn't all that relevant. The question is how much of an impact it will make.
To give an example 10% of your income isn't that big in comparison to your whole income. But if someone were to take that 10% away every month it would have a sizable impact on your overall life.
In the graph, the debt is clearly starting to go parabolic in the last decade while the gdp stays linear. That's the problem right there viz. no cx can always beat a kx^2 for any c,k 'cause beyond x=(c/k), the kx^2 will win.
morover the c is realtively static for a developed first world nation - you are not going to see USA growing at 9 and 10% like India/China. It'll be like 2% and 3% best case cause the US economy is so large growing it even 1% is a monumental task. Whereas the k, once it picks up steam, actually gets really large really fast. Your interest piles up and you can't pay so you borrow more so the rate goes up on you so the interest piles up even faster and repeat...
Last I heard we were estimated to be spending $533 billion per year in 2015 and that estimate was from 2009 (we've spent a lot more since then). So assuming that's brought us a little closer you can assume we'll be paying $500 billion in the next year or so. Meaning you can look at the One Trillion Visualization and cut it in half.
I understood that as a style figure meaning 'the US government is using borrowed money, like a credit card'. I think it's quite disingenuous.
(maybe I'm wrong - I'd do a first-order validation of the idea by dividing 15 trillion by the amount of us citizens, but I don't quite know now many zeroes there are in 15 trillion and if it's effected by false friends like 'billion' (meaning: 'billion' in English has a different amount of zeroes as the homophones in other languages)).
What's wrong with debt? With loans I was able to speed up my progress. I took loans two times and ready to take it the next time. You'll need just to be certain that you'll pay off. There is risk, but risk is everywhere you do business.
What's wrong is someone else getting into debt on my behalf, promising to pay it back with money they will take from me by threat of force as taxes, for purposes I wasn't consulted on, to further an unsustainable goal of perpetual growth which is hurrying the arrival of global problems.
>With loans I was able to speed up my progress. I took loans two times and ready to take it the next time.
sounds like you didn't blow your loans on girls and booze. The people's worries about the government debt, i think, in major part are really worries about where all these moneys have been going. Exponential growth of the amount of "bucks" while flatline [at best] of the total resulting "bang" does rise the question.
Some other physical comparisons that could have been included are actually the size of stacking 400 million people on top of each other, how big that would be, and also how much food they would eat in their lifetime, and how much oil and/or plastic goods they would consume. Other than that, I agree with a lot of the other comments here, big numbers are big. "I mean, you may think it's a long way down the road to the chemist's, but that's just peanuts to space, listen..." - HHGTTG
Or (one hopes) agree to give up their social security benefits. I wish my generation could negotiate as a block and say something equivalent to, "We'll surrender any possibility of SS benefits---and still pay payroll tax---in exchange for an assurance that the new paper leeway won't be used as an excuse to spend more."
It only holds for a particular country if its trade balance is 0. Otherwise, you have to add in the trade deficit/surplus in the equation.
In the case of the US, the trade balance is pretty nonzero. So part of the US public debt is counterbalanced by public assets or private saving in other countries, not private sector savings in the US.
And you do see people worked up over other countries holding US bonds as assets, in fact.
(Or put another way, the Chinese government has a policy regime that forces Chinese consumers to oversave and at the same time does not issue enough of its own public debt to absorb that savings, so part of that savings ends up absorbed by public debt in other countries. Same for Germany and Japan.)
al jazeera did a very good video showing the greek debt also using pallets (http://www.wesoscrewed.com/2011/07/19/pallets-upon-pallets-o...). there is just something about seeing that amount of money in cash on pallets that makes me sick to my stomach. Talk about a huge hole to climb out of...
No self respecting rich guy paid that much...You have to talk about the effective tax rate (both personal and capital gain). This was always around 30% in the last 70-80 years!
So the best thing to do is to abolish all deductions for the rich and reduce the top tax rate to something like 28% (which the new debt commission recommended)
[+] [-] tmorton|14 years ago|reply
The US debt is a big number. So big that people have a hard time wrapping their head around it. They need a point of comparison. So what's a good point of comparison for the US debt? Hmm... we could use the federal budget, or GDP, or the world GDP, or the debt of other large nations. Or we could break it down per capita, and compare it to other per-capita things, like income or tax burden. Or... I know! We can convert the thing to hundred dollar bills, and put it next to the statue of liberty! That's a meaningful comparison!
[+] [-] reduxredacted|14 years ago|reply
As an accurate, useful comparison it falls short, and there's a political agenda behind it (I hate politics, yet I'm commenting). But people don't regularly wrap their brain around how big a trillion really is. Had the site used sticks, marbles, pebbles or even an illustration related to time, it would have been useful. I remember as a child being taught the difference between a million and a billion in that manner and it was important to my relative understanding of numbers. Most people don't work with big numbers all day and could gain something from just that simple point ... big numbers are big.
It's dishonest, though, and reminds me of why I hate politics. At university, I had a philosophy professor who argued injustice by comparing the percentage of African-Americans on death row vs. other nations of origin, to the percentage of the African-Americans in the US population vs. other nations of origin. He provided those two numbers and much of the class was shocked. The problem is that the US doesn't pick random citizens to be on death row, it picks citizens who are convicted of capital crimes. A more honest comparison (and, still yet, illustrative of the point, though less dramatic) would be to compare the number of African-Americans convicted of a capital crime and sentenced to death with the same rates of other minority groups (or even against everyone else as a whole would be an improvement), and then, of course, diving into conviction rates, reasonably provable false conviction rates and the host of other variables that enter into an imperfect system that is imperfect because human beings are imperfect.
EDIT: Improper use of asterisks. Tsk Tsk. Corrected my description of the professor's comparison by adding "vs. other nations of origin" since that's more accurate.
[+] [-] joelhaus|14 years ago|reply
Planet Money recently did a nice job of comparing the current U.S. debt level and the historic debt levels of other countries to GDP, and how that impacted their economic fate:
http://www.npr.org/blogs/money/2011/07/20/138518262/the-tues...
[+] [-] temphn|14 years ago|reply
You want to explain abstractions in terms of concrete things like this, rather than in terms of other abstractions. And "GDP" is as abstract as it gets.
[+] [-] nuromancer|14 years ago|reply
[+] [-] kristiandupont|14 years ago|reply
[+] [-] unknown|14 years ago|reply
[deleted]
[+] [-] vacri|14 years ago|reply
[+] [-] scarmig|14 years ago|reply
A better comparison would be to take a single person, and put the per capita amount of debt in $100 bills next to them. If you want to get really histrionic, do it with a baby. Still, it won't come up past the ankles (around $15,000).
This isn't a small amount, but at the same time it's not the end of the world. My college loans come out to that amount, and I barely notice paying them monthly.
It's equivalent to having a mortgage-sized to around five times your annual income. An annual income that typically grows 2.5% a year and comes with a machine that prints out money whenever you need it.
Edit: typo in Google search, it's more like $50k than $15k. So a bit worse than that analysis would suggest.
[+] [-] orangecat|14 years ago|reply
More like $45k.
[+] [-] malbs|14 years ago|reply
If you're lucky enough to work at a company that does actually have a policy of CPI pay increases every year.
Of all the companies I've worked for (7), only 1 did.
[+] [-] nl|14 years ago|reply
A $400,000 home loan looks pretty big if you visualize it in 1 cent pieces, but if you put it next to a $100,000 salary it looks pretty reasonable.
"US Unfunded Liabilities" is a stupid thing to measure anyway. That's like putting all your household expenses for the next 30 years on mortgage graph. Yes, you will need to pay them, but they aren't a debt at all.
Personally, I prefer seeing debt as a percentage of GDP: http://en.wikipedia.org/wiki/United_States_public_debt#Measu...
[+] [-] ctdonath|14 years ago|reply
[+] [-] JonnieCache|14 years ago|reply
[+] [-] nuromancer|14 years ago|reply
[+] [-] ljf|14 years ago|reply
[+] [-] nkassis|14 years ago|reply
[+] [-] TomOfTTB|14 years ago|reply
Just so I don't get accused of making ad hominems let me explain my contention above. You seem to think the size of the debt isn't a big deal because it is small compared to GDP. That would be an effective argument if the question was "will the U.S. go bankrupt"
But when people are assessing how big a problem the debt is the question they are asking is how much it will impact our overall standard of living when we inevitably have to start paying it off. So how big it is in comparison to GDP isn't all that relevant. The question is how much of an impact it will make.
To give an example 10% of your income isn't that big in comparison to your whole income. But if someone were to take that 10% away every month it would have a sizable impact on your overall life.
[+] [-] dxbydt|14 years ago|reply
In the graph, the debt is clearly starting to go parabolic in the last decade while the gdp stays linear. That's the problem right there viz. no cx can always beat a kx^2 for any c,k 'cause beyond x=(c/k), the kx^2 will win. morover the c is realtively static for a developed first world nation - you are not going to see USA growing at 9 and 10% like India/China. It'll be like 2% and 3% best case cause the US economy is so large growing it even 1% is a monumental task. Whereas the k, once it picks up steam, actually gets really large really fast. Your interest piles up and you can't pay so you borrow more so the rate goes up on you so the interest piles up even faster and repeat...
[+] [-] camiller|14 years ago|reply
http://en.wikipedia.org/wiki/File:US_Federal_Debt_as_Percent...
[+] [-] grepittech|14 years ago|reply
[+] [-] TomOfTTB|14 years ago|reply
Only source I could find for this: http://money.cnn.com/2009/11/19/news/economy/debt_interest/i...
[+] [-] ctdonath|14 years ago|reply
$385B of this year's spending is just paying interest on the debt. Scale the $1000B (one trillion) picture accordingly.
[+] [-] maguay|14 years ago|reply
Is this meaning US consumer credit card debt? If so, that's hardly the US government budget's fault. That one is odd at best.
[+] [-] roel_v|14 years ago|reply
(maybe I'm wrong - I'd do a first-order validation of the idea by dividing 15 trillion by the amount of us citizens, but I don't quite know now many zeroes there are in 15 trillion and if it's effected by false friends like 'billion' (meaning: 'billion' in English has a different amount of zeroes as the homophones in other languages)).
[+] [-] maguay|14 years ago|reply
Right. And it's against Adsense terms to ask people to click your ads. What a mess.
[+] [-] csomar|14 years ago|reply
[+] [-] jodrellblank|14 years ago|reply
[+] [-] VladRussian|14 years ago|reply
sounds like you didn't blow your loans on girls and booze. The people's worries about the government debt, i think, in major part are really worries about where all these moneys have been going. Exponential growth of the amount of "bucks" while flatline [at best] of the total resulting "bang" does rise the question.
[+] [-] winternett|14 years ago|reply
[+] [-] cpeterso|14 years ago|reply
[+] [-] th0ma5|14 years ago|reply
[+] [-] username3|14 years ago|reply
[+] [-] invalidOrTaken|14 years ago|reply
[+] [-] chrismealy|14 years ago|reply
[+] [-] walkon|14 years ago|reply
[+] [-] bzbarsky|14 years ago|reply
It only holds for a particular country if its trade balance is 0. Otherwise, you have to add in the trade deficit/surplus in the equation.
In the case of the US, the trade balance is pretty nonzero. So part of the US public debt is counterbalanced by public assets or private saving in other countries, not private sector savings in the US.
And you do see people worked up over other countries holding US bonds as assets, in fact.
(Or put another way, the Chinese government has a policy regime that forces Chinese consumers to oversave and at the same time does not issue enough of its own public debt to absorb that savings, so part of that savings ends up absorbed by public debt in other countries. Same for Germany and Japan.)
[+] [-] brimpa|14 years ago|reply
[+] [-] draggnar|14 years ago|reply
[+] [-] Vivtek|14 years ago|reply
[+] [-] ulisesroche|14 years ago|reply
[+] [-] astrofinch|14 years ago|reply
[+] [-] eru|14 years ago|reply
[+] [-] known|14 years ago|reply
[+] [-] gopi|14 years ago|reply
So the best thing to do is to abolish all deductions for the rich and reduce the top tax rate to something like 28% (which the new debt commission recommended)
[+] [-] known|14 years ago|reply