How Big Is One Trillion Dollars?

A trillion dollars... Wow!

I remember when the media was near apoplectic when the national debt reached one trillion dollars during the presidency of Ronald Reagan. Today, it seems we're numb to the enormity of our national debt and especially the speed at which it keeps growing.  

We say it so casually now—federal deficits, national debt, 25 trillion, 30 trillion, 35 trillion... And a request from the White House for another 1.5 trillion for the Pentagon. I know what two marbles is, or five oranges. But when you say one trillion its no longer anything but an abstraction. Or a talking point.

So let's put this in perspective. What does one trillion dollars s look like? Here's one way to get a sense of it:

If you stacked one trillion dollars in $100 bills, the tower would rise approximately 631 or 680 miles into the sky, depending on which AI you ask. (Google says 63o-678 miles.) That's more than two and a half times higher than the orbit of the International Space Station. We're talking about Yertle the Turtle on mega-steroids.The stack would dwarf the Empire State Building as though it were a decorative lawn ornament. The Statue of Liberty would disappear into insignificance at its base.

Let's attack this from a different angle. I asked Grok, "How high would a billion dollar stack of hundred dollar bills be?" Here's how to calculate it. $1,000,000,000 ÷ $100 = 10 million bills. Each bill is 0.0043 inches thick, which when stacked would be 43,000 inches. 43,000 x 12 equals 3583 feet, which is 3 times the height of the Eiffel Tower.

A trillion dollars, if you can stack that high, would reach up into the sky 630 to 680 miles. It's one thousand billions.  If you spent one million dollars every single day, it would take nearly 2,740 years to spend a trillion dollars.

When politicians discuss adding “just another trillion” to a budget, or when economists speak of trillion-dollar deficits as though they are routine, we ought to pause long enough to picture this tower of money stretching into the edge of outer space.  

As of May 2026, the U.S. national debt is approaching $39 trillion. The Joint Economic Committee reported it at roughly $38.9 trillion in early May. 

What's scary to me is interest payments on our debt are now approaching or exceeding $1 trillion per year, which means the federal government spends more on interest than many entire nations produce economically.

I keep asking myself how things can go on like this. At what point does the whole shebang collapse like a house of cards? 

What I don't understand is how we keep electing people who don't understand basic economics. If you spend more money than you take in, you're going to keep going deeper into debt. Sooner or later you're going be is a very bad place. 

 

Has the U.S. Lost Its Edge? Does the Future Belong to China?

Aldous Huxley's Brave New World was set in the future in the year 600 A.F.  The "A.F." stands for "After Ford," referencing Henry Ford, who revolutionized the automotive industry with the introduction of the assembly line and mass production. In the future Huxley describes, humans will be purposefully designed and efficiently mass-produced as well.

There is a sense in which mass production and efficiency were two of the primary engines that powered America's economic growth and enabled us to gear up for the war effort that stalled, then toppled the Axis powers (Germany, Italy, Japan) in W.W. II. 

Now, however, 80 years have passed and it seems like the U.S. is so bogged down in red tape, litigation and corrupt self-serving politicians that it can't help but decline as a world power. It's almost insane how hamstrung our government is at every level; federal, state and local. We allocate billions for infractructure and only manage to buid a handful of charging stations. When we set aside a billion dollars for housing we create a few hundred. Government incompetence is legendary.

How does this inefficiency compare to what China has been able to achieve and is accomplishng? Is China destined to become the most powerful nation on earth?

* * * 

The issue of whether our nation's internal challenges with red tape, litigation, and political corruption could lead to a decline in its global power, thereby allowing China to potentially become the most powerful nation on earth, is real. Here are some of the variables at play.

Red Tape and Bureaucracy: The U.S. is often criticized for its extensive regulatory environment which slows down innovation, infrastructure projects, and economic activities. This can deter both domestic and foreign investment due to the complexity and time involved in navigating regulations. 

Litigation: The litigious nature of U.S. society has led to a system where fear of lawsuits can stifle innovation and increase costs for businesses potentially affecting competitiveness. I recently concluded that we no longer live in a land where justice is blind. The new unspoken reality seems to be, "He who has the most lawyers wins." This environment can lead to a focus on compliance rather than growth or development.

Political Corruption: Corruption, while not as rampant as in some other countries, remains a concern. The U.S. has seen declines in its Corruption Perceptions Index, reflecting issues with political integrity and the influence of money in politics, which can distort policy-making and economic decisions.

The Rise of China

Economic Growth: China has pursued a path of rapid economic development, becoming the world's second-largest economy with ambitions to lead in technology and global influence. Its strategies like the Belt and Road Initiative illustrate an attempt to extend economic and political influence globally. The B&RI is an infrastructure and economic development strategy designed to build ties to Asia and Africa in a manner quite different than the way in which the U.S. and Europe exploited the poorer and weaker nations of the world, extracting resources and loaning money at exorbitant interest rates. 

Government Efficiency: China's one-party state system allows for quicker decision-making and project implementation compared to democratic systems like that of the U.S., where consensus-building can be time-consuming. To build new nuclear power plant takes as much time (or more) dealiing with red tape and litigation as building the plant itself. A ban on new nuclear energy plans has lasted 30 years in Minnesota while the demand for energy continues to grow.  By way of contrast, China has 29 new nuclear reactors under construction and in August 2024 approved 11 additional new nuclear plants. This kind of efficiency has been a significant factor in its economic growth.

Political Stability: Under Xi Jinping, China has seen a consolidation of power, which, while criticized for diminishing political freedoms, provides a stable environment for policy execution, unlike the often gridlocked U.S. political system.

Global Power Dynamics

Military and Technological Edge: Despite challenges, the U.S. retains significant military capabilities and is a leader in technology, although China is rapidly catching up in areas like AI, 5G, and surveillance technology.

Soft Power and Alliances: The U.S. has traditionally held strong alliances and cultural influence globally. However, as noted, China is expanding its soft power through economic investments and cultural outreach, though it faces resistance in some democratic nations due to concerns over human rights and political freedoms.

Economic Interdependence: The global economy's interconnectedness means that both countries are vital to each other's economic health. Decoupling or a significant shift in power would have profound global impacts, potentially destabilizing rather than simply shifting dominance.

*

When looking toward the future, we cannot see how the many variables will impact one another. China is funding its ambitious goals with debt which is growing fairly rapidly. Even so, in the debt race, the U.S. is carrying a rather stunning load of its own--more than $35 trillion--and is almost certain to exceed more than $50 trillion within ten years.

Besides debt, China has other challenges including demographic issues and international pushback agaist its policies. There is no certainty with regards to how all these things will play out.

I myself feel a bit like Ebenezer Scrooge when he asks if the thngs he has seen can be altered. “Spirit, are these the shadows of the things that Will be, or are they shadows of the things that May be, only?” My concern is that if current trends in the U.S. continue without significant reform and China manages its issues effectively, the balance of power will indeed shift towards China.  

What do you think?
(Leave your comment below.)

Some of the information here was gathered via Grok.

The Conundrum of Consumer Spending

"What's good is bad, what's bad is good
You'll find out when you reach the top
You're on the bottom."
--Bob Dylan, Idiot Wind

The Wall Street Journal had a story this morning that began like this:

"Stocks edged lower Tuesday on worries about consumer spending, after Dick's Sporting Goods and Macy's reported weaker sales, sending their shares sharply lower."

It's a perfect illustration of the contradictions inherent in modern life. The other day I wrote about the massive self-storage industry that has been generated by consumerism. America's "I gotta have it" attitudes have morphed into "Where can I put it?" Eventually, we get to this point: "How do I get rid of it?"

And yet, if American's don't fulfill their duty and continue to be good consumers, businesses fail, people get laid off, and the economy weakens.

It seems like we put a lot of responsibility on consumers to keep the economy afloat. Naturally, the banks and financial institutions will continually remind you that the benefits of this or that new credit card can help solve your money problems. 

Haha. More debt is a solution? According to one recent source, "As of the second quarter of 2023, the total consumer debt in the United States is $17.06 trillion."

KEEP IN MIND that this does not include the U.S. government deficits. That's right, American's are on the hook to help pay that down, too. That is, if our legislators had the courage to tell us that we will all need to chip in and pay the bills our taxes are supposed to be used for to run the country. We're talking more than $30 trillion on that deal.

Hmmm. So we have mixed messages to consider. Be responsible vs. Spend like there's no tomorrow.

Good luck.

What Are the Biggest Threats to Small Business?

Small businesses are an essential part of the fabric of our society, and their success is critical to the success of our economy and our communities. I'd like to suggest that small businesses represent the heart of America's free markets. Small businesses are where people put their entrepreneurial dreams into action. 

Here are some of the benefits of small businesses:

1. Job creation: Small businesses are significant contributors to job creation. They create job opportunities for the local community, providing employment for people of different skill levels and backgrounds. According to the Small Business Administration (SBA), small businesses created 1.5 million jobs in 2019 alone.
2. Economic growth: Small businesses are vital to the growth of the economy. They contribute to the GDP and promote economic growth by generating income and creating wealth. They also stimulate competition, which helps drive innovation and reduce prices.
3. Local community development: Small businesses play a crucial role in the development of local communities. They help to build and sustain vibrant neighborhoods by providing goods and services that meet the needs of the local population. You can see this happening in Duluth's Lincoln Park District. Small businesses also tend to reinvest profits back into the community, which helps to support other local businesses.
4. Entrepreneurship: Small businesses are a platform for entrepreneurship. They provide opportunities for individuals to start and grow their businesses, pursue their passions, and achieve their dreams. Small businesses also help to create a diverse and dynamic business environment, which encourages innovation and creativity.
5. Resilience: Small businesses are generally more agile and adaptable than large corporations, which makes them more resilient in times of economic uncertainty like today. They can respond more quickly to changes in market conditions and customer needs, which enables them to stay competitive and survive challenging times.

On the other hand, small businesses also face a unique set of challenges and risks that can pose significant threats to their success. Some of the biggest threats to small businesses include:

1. Limited resources: Small businesses typically have limited financial and human resources, which can make it difficult to compete with larger players in the market. 
2. Economic downturns: Small businesses are particularly vulnerable to economic downturns as they may not have the financial reserves to weather a prolonged period of low sales and revenue. 
3. Increased competition: Small businesses may face competition from larger, established businesses or new entrants in the market, which can put pressure on their profitability.
4. Difficulty accessing financing: Small businesses may struggle to secure financing due to their size, lack of collateral, or limited credit history, which can limit their ability to invest in growth or ride out tough times. The current economic turbulence is especially problematic for companies dealing with debt. Uncertainty about interest rates makes it difficult to accurately plan ahead.
5. Cybersecurity threats: Small businesses are often seen as easy targets by cybercriminals, who may exploit vulnerabilities in their systems and steal sensitive data or money. This and most of the other challenges are directly related to not having the necessary funding to stay current. 
6. Regulatory compliance: Small businesses may struggle to keep up with changing regulations and compliance requirements, which can result in costly fines and legal issues. You may not be able to afford having an HR pro on staff, but there are HR pros out there whom you can lean on for this nightmarish facet of your business. Locally, Stacy Johnson of Audacity HR is a capable "go to" for this and other matters.
7. Staffing challenges: Small businesses may have difficulty attracting and retaining employee talent, which can impact their ability to grow and compete. 
8. Cash flow issues: Small businesses may face cash flow issues due to late payments from customers, inventory management, or other unexpected expenses.

These are just a few examples of threats to small businesses. One more to consider: life insurance. If your business is a partnership, what happens if one of the partners dies unexpectedly. How much will it set you back? Don't assume everything will be hunky dory because you're all young. 

On a related note, if the past three years has taught us anything it's that we can't take tomorrow for granted. Remember, it's not what happens to you, but how you react that counts.

To overcome these challenges, small business owners must develop sound strategies, stay agile and adaptable, and seek out support and resources as needed. If you're a business owner, I hope you've found something useful here.

EdNote: Story created with assistance from ChatGPT.

Illustrations by the author.

Mystified by America's Debt Crisis? Here's Why Some People Are More Than A Little Concerned

"Watching and Waiting"

Numbers, when they are large enough, become less real and truly challenging to wrap one's arms around. The larger the number, the more abstract it becomes as a concept. This may be why all these discussions about increasing the national debt fail to alarm so many people. Instead of discussing how much the country owes, politicians try to focus our attention on what we, the public, are going to get.

Look over here (at free college education) and don't look over there (at the price tag you will be saddled with in the long run.) 

If you go online to find out how much debt our country carries, you will find a variety of sites with numbers that don't entirely match. What you'll find, though, is the numbers are very, very large.

I remember when the pundits were in near hysterics when the 1981 proposed budget under Ronald Reagan crossed the one trillion dollar mark. Raising the debt ceiling a 2.5 trillion seemed easy-peasy last week with nary a peep.

Here are some numbers from Truth In Accounting.  

U.S. Published National Debt consists of:

• debt held by the public

• intragovernmental holdings, including debt held by Social Security and Medicare trust funds
  
  

OUR PUBLISHED DEBT IS now over 31 trillion...

but out REAL debt is 140 Trillion.

SINCE OUR GOVERNMENT is us, as in you and me, this debt shakes out to be $936,000 per taxpayer.

When the government states that they want to raise the debt ceiling so they can give us more good things, what they mean is that they want you to OWE MORE, because it is OUR Debt.

The website Trading Economics presents a slightly scarier picture. They not only present the status of government debt, but also private debt. Private debt is the total of all individual and business debt. Going a step further, they calculate the ratio of total indebtedness of both sectors, non-financial corporations and households and non-profit institutions serving households, in relation to GDP.

At this moment in time, according to this site, our cumulative debt is 235% greater than our current GDP.

* * * 

Well, to be frank, I don't know how accurate any of this is, and I'm not even sure anyone knows. What I do know is that these are all fairly large numbers. How big is a Trillion? This illustration will bend your mind a little, I believe.

What happens when nations fail to meet their debt obligations? Can they really just default the way individuals do by declaring bankruptcy? 

Stimulus Maximus

In the late 90’s a good friend of mine used to express his concerns about personal debt in America. As the years rolled by he would, from time to time, share stats about the enormous debt load being accumulated by consumers. A few years ago he stated that personal debt had increased by 300% since 1990. Wages, in real terms, had been increasing only 1% per year over the same period. In other words, we were spending way more than we were making.

Yesterday morning I started reading an audio book called Maxed Out, Hard Times in the Age of Easy Credit by James D. Scurlock. Essentially, according to Scurlock, we live in a debt culture. College debt, consumer debt, second mortgages, loan services, easy credit… From the time we enter adulthood at age eighteen we're not only bombarded with credit cards, but we're also told that our ability to handle debt is a good thing for our credit rating.

A review on Amazon.com included this statement about the book. "This engaging narrative presents numerous stories about easy credit given to students, the poor, the weak and the uninformed, whose lives are ruined by their debt burden, including some cases of suicide." I knew a woman whose father committed suicide because of his debts. He was not one of the poor, weak or uninformed mentioned here. Just another casualty along the American way.

It's funny how pawn shops have grown in importance in our country. I don't ever recall seeing a pawn shop when I was a kid, though I am sure they existed because someone had to be a fence for stolen goods, right? Now, pawn shops are a part of any urban landscape, taking advantage of desperate people by offering cash at ten cents on the dollar for what is often a prized possession.

Debt consolidation services, encouragements to fix everything with a second mortgage, all these tools exist to stay above the waves, or as Scurlock puts it, to surf a wave of debt.

Not mentioned yet in the book, but of concern to me, is that our country now exports these ideas which lead to enslavement of new candidates for borrowed money. We have mutual funds which actually head into the Third World offering help to the poor by loaning money, then charging exorbitant interest. These people have no experience with all that fine print. They only see the cash and the ability to stave off hunger for their little ones. It's an ugly business.

Returning to the review on Amazon: "In recounting the history of credit cards and the effort to sell credit as a lifestyle, the author claims that credit given to those who do not have the ability to repay it is entrapment. His is an urgent call to arms in the way we think about debt; he blames financial institutions and a seemingly powerless Congress that during the past 30 years has allowed bankers to make the rules on extending credit. While not everyone will agree with Scurlock, this is a valuable perspective for library patrons in our materialistic, debt-ridden society and provides excellent education on an important topic."

If one thinks excessive debt is a problem for individual, one has to wonder what current stimulus package is going to do to our country. A lot of people think the government can bail us out of anything, and why not a debt crisis? Haven't they always bailed us out before?

Well, here is an article from the most reason Reason magazine in which a group of economists have weighed in on what ultimately passed as legislation designed purportedly to stimulate our economy. Here's the online version of the piece, which I recommend to you, called The Reason.com Stimulus Symposium in which a panel of leading economists sound off on the $800 billion stimulus package.

So it seems our government leaders are cut from the same piece of cloth as ourselves. We keep telling ourselves that if only we had just a little more money we can fix everything. What do you think? Read 'em and weep? Seems like sooner or later someone always has to pay. Looks like the Boomer legacy might be to leave that problem to their children.

The Ethics of Usury

"Debt, n. An ingenious substitute for the chain and whip of the slavedriver." ~ Ambrose Bierce

The word usury comes from a Latin word meaning "interest" or "excessive interest", and originally mean the charging of interest on loans. Two dictionary definitions that pretty much give shape to the concept are these:

2: the lending of money with an interest charge for its use ; especially : the lending of money at exorbitant interest rates

3: an unconscionable or exorbitant rate or amount of interest ; specifically : interest in excess of a legal rate charged to a borrower for the use of money

On Wednesday, our paper picked up an L.A. Times story titled, "Student loans turn into crushing burden for unwary borrowers." It begins by telling the story of Natalie Hickey who graduated Brooks Institute with $140,000 in student loans. Some of these were at an 18% inyterest rate, which feels outrageous to me. Her monthly payments are currently 1700 dollars on the interest alone.

Another story is titled "Families losing appetite for college debt" and the Badger Herald highlights the issue with this story, "Why college debt hurts generation."

Over the past fifty years there has been this major push to get kids into college. Was it because the kids all needed college? Or was it because when the Baby Boomers were in college during the Sixties, they built too many dorms and schools?

Everything has value, but exactly how much value is often difficult to define. The cost of college has risen 439% since 1982, but has the value of a college education risen by 400%? All these kids get told that in order to compete in the modern world, they need college. The banking industry obviously steps in an sees all these young people as a source of ready revenue. They are young, inexperienced, easily enticed by the prospects of easy money to help get that essential degree. They do not understand the heavy burden debt and interest on debt can become.

There's another surprise waiting for this debt-laden generation now entering the workforce. Multinational corporations are now outsourcing white collar jobs to India. By 2015, according to Robyn Meredith in her insightful study of the rise of India and China, The Elephant and the Dragon, more than 3 million white collar jobs will have been exported. Programmers and positions that once garnered six figure incomes are being swept overseas, leaving service sector jobs in their wake.

In short, young people have imbibed a false gospel, never questioning the message because their parents were likewise mesmerized by its apparent validity.

In order to help them solve the Watergate scandal, Deep Throat encouraged Woodward & Bernstein to "follow the money." Let's see where the money goes in this instance. To colleges and universities. And all that interest, where does it go? Lending institutions. And where does it come from?

Please understand, this is not an attempt to denigrate the value of a college education. It is only a challenge to the ethic of loaning money to people who do not fully understand the compact they are getting into. Until you are free from debt, you are not free to come and go as you please.

Similar unconscionable lending is occuring now in Third World countries where people are being given loans at twenty and thirty percent interest, without ever having had training in what interest rates mean. It is essentially a suckerpunch to those who are already economically on the ropes. What looks like easy money ends up being a ball and chain.

Ben Franklin called debt a vice, Disraeli called it the mother of folly and crime. But our modern era wants us to believe this is a perfectly normal way of life. I'm not really sure what I think of that.