The Real Numbers

USA Today has been on this story for years, and they deserve credit for continuing to make the point and bring it back around to our attention every so often.  One of the things that a robust journalism should do is bring these kinds of major national issues to our attention when the powerful are trying to hide the scale of the problem.

If you applied corporate accounting rules to Federal spending, we'd see that our current budget deficit is over five trillion dollars a year.  To balance the budget at current spending rates, the average American family would need to fork over almost its entire income in Federal tax alone.

That doesn't speak to the state crises, which are not limited to California.  This is just the Federal problem.

However, that's just the scale for this year.  Look at the bigger picture:

Federal debt and retiree commitments equal $561,254 per household. By contrast, an average household owes a combined $116,057 for mortgages, car loans and other debts.

Well, so the average American household is $677,000 in debt.  What's the average net worth of an American household?  It's a lot higher than I would have thought -- $434,000 and change.  (The median net worth is much closer to what I would have expected, but there are a certain number of very rich people out there).

So that's just an extra $137,000 that the average household needs to earn in its lifetime, and things will be ducky.  (That is, the $561,000 in 'extra' debt you don't know you have, minus average net worth, which already considers the average $116,000 in ordinary debt.)  After you fork that over, you can start getting ahead.