Back in the mid-1990s I was posted as Economic and Commercial Officer to the U.S. Embassy in Tirana, Albania. This was the time of the massive pyramid schemes into which most of the small country’s population sunk their funds and, with the schemes’ inevitable collapse, when Albania was brought to anarchy. I sounded the warning of what was going on and what would happen shortly after my arrival in Tirana in mid-1995, and my prediction of when the collapse would commence, in October a year later, was accurate almost to the week. To give proper credit, it was economy watchers in other organizations that brought my attention to the building crisis, though the U.S. Embassy and the State Department were blithely ignorant of what was going on until I started reporting on the schemes, gaining me an instant and very interested audience back in Washington.
In the midst of the schemes’ collapse some of the scheme heads and promoters bandied about references to large sums of money that they had taken in, such as $500 million, or even a billion dollars. This in a country of some 3 million people and a per capita income under $1,000. No one seemed to have any concept of what such amounts really meant or how big a billion dollars was, and many were willing to take the claims at face value. So I took it upon myself to write a piece about what a billion dollars – 1,000 million dollars – look like. You can see that piece here.
Now fast forward to 2018, and we here in the U.S. live in a country where not billions, but trillions of dollars, are bandied about like they’re nothing. Consider that the current federal government debt is $21.48 trillion, with an additional $1.2 trillion in state debt and $1.92 trillion in local government debt bringing total public debt to $24.6 trillion. Consumer debt – credit cards, auto loans, student loans, and personal loans – is approaching $4 trillion, and when mortgage debt is added in, private debt in the U.S. stands at $13.21 trillion. U.S. combined public and private debt, therefore, is nearly $38 trillion. Compare those numbers with the country’s Gross Domestic Product – the total sum of domestic economic activity – of about $20 trillion, or the entire world’s total GDP, known as Gross World Product, or GWP, which in 2014 was $78.28 trillion. That means the U.S. debt ratio is approaching (and sometimes surpasses) double U.S. GDP, and is nearly half of total world economic output. Meanwhile, the federal government budget for the fiscal year that begins October 1 is $4.407 trillion, with a projected deficit of $985 billion, which will be added to the debt.
All that is scary enough on its face, but it still doesn’t tell us what a trillion dollars looks like. So let’s dive into that question and try to put a face on that number.
First, the basics. Just as a billion dollars is 1,000 million dollars, a trillion dollars is 1,000 billion dollars, or 1 million million dollars. That’s a 1 with 12 zeroes after it. Like this: 1,000,000,000,000. So if you’re fortunate enough to be a millionaire, with $1 million in assets, you would just need to multiply your fortune 1,000 times to become a billionaire, or to multiply it 1 million times to become a trillionaire. There aren’t any trillionaires in the world – the world’s richest person is Amazon founder Jeff Bezos, worth some $112 billion – but Apple became, at least for awhile, the first contemporary company to surpass $1 trillion in value, based on its stock price, on August 2.
Let’s use some of the same examples I previously used to illustrate a billion dollars, but now to give you some idea of what a trillion dollars look like.
- Let’s say you go the bank and take out a trillion one-dollar bills. Just for fun, you decide to stretch them out end-to-end. You’d find this to be a tough task since they will stretch some 95,000,000 miles (150,000,000 kms), or 3,800 times around the Earth at the Equator. Actually, since the distance from the Earth to the sun is 93,000,000 miles, you could spread them out across deep space between here and the sun, and a couple million miles on the way back.
- If you decide you don’t have time for a trip to the sun and part-way back, you ask the bank to give you your trillion dollars in $100 bills, the largest current denomination bill issued by the U.S. Treasury. Laying these notes end-to-end, you’d only have to lay down a trail of 950,000 miles (1,500,000 kms), or a mere 38 times around the Earth at the Equator. If, on the other hand, you’re the space-going type, you’d be able lay them out to the moon and back – twice.
- Now you go to the bank and just ask the teller to stack your trillion dollars outside. You’ll take them in $100 notes since you don’t have much room in the trunk of your car. You better be prepared, though, for a surprise. Your trillion dollars will stack 631 miles (1,015 kms) high, two and a half times the orbital altitude of the International Space Station. Now if you were to stack the federal budget deficit in $100 bills, you’d have a stack that reaches 13,554 miles (21,813 kms) high. Consider that the Earth’s diameter at the Equator is just 7,900 miles (12,714 kms), and you’ll have some idea of the scale of this. You see now why you had best not ask for your trillion dollars in singles, which would stack 63,100 miles (101,500 kms) high, almost eight times the polar diameter of the Earth. Now multiply that by 21.48 – the number of trillions in the federal budget deficit – and . . . well, you get the idea.
- Okay, I get it. These dimensions are hard to picture. You’re more the saving type, so let’s see how long it will take you to save a trillion dollars. Notionally, you earn the average (median) U.S. national individual income of around $32,000. Since your spouse fully supports you, and you’re good at not paying any taxes, you’re able to stash away all $32,000. Hopefully patience is one of your stronger characteristics, since it will take you a mere 31 million years – 31,250,000 years, to be exact – to save $1 trillion. Of course, that could pose a problem. Humans in their current form have been on the planet only about 200,000 years. Humanoid ancestors were around about 6 million years ago. So you’re falling short by more than a factor of five of all human and proto-human life on Earth.
- Now let’s say you’re doing a whole lot better than that and you can save $50,000, not in a year, but in a day. That means you can sock away $18,250,000 a year. In that case, it would only take you 54,794 years to save $1 trillion. If you were to save long enough to pay off all the public and private debt in the U.S., at $50,000/day it would take you 2,071,761 years, more or less, to get the pink slip on the debt. Kind of puts that 30-year mortgage into perspective, doesn’t it?
- Forget saving. That’s not your style. You’re more the spending type, as is your spouse. You’re among the lucky one percenters, together earning $400,000 a year. You decide to spend it all (taxes be damned), and are aiming to spend a cool $1 trillion. Well, that would only take you a quarter million years – that’s 250,000 years.
- Let’s say you’re the lucky type, instead. The very lucky type. Starting the year Christ was born, you buy a lottery ticket that miraculously wins and nets you $500 million every single year. You put away that $500 million prize, and the next $500 million prize, and the 1,998 $500 million prizes after that, and you finally reach $1 trillion in winnings – 18 years ago. Two thousand years after your winning streak began, your trillion dollars will go to your distant heirs.
- Looking at things from a different perspective, the current U.S. federal budget deficit equates to more than $65,950 in debt for every one of the 325.7 million men, women, and children living in the U.S. Adding in all the other debt, and the burden becomes more than $116,000 per every single capita. Again, keep in mind that the average adult annual income is just about $32,000, and average U.S. household income is about $59,000.
So now you have some idea what a trillion dollars looks like. And if that isn’t enough to freak you out, or at minimum give you cause for pause, I don’t know what would.
If you have some other illustrations, please post them here in your comments.