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Nancy Smith

What If the Spend-Happy Federal Government Were an American Family?

October 30, 2011 - 7:00pm

If the United States government were a family, it would be making $21,700 a year, spending $38,200 and drowning in $142,710 of credit card debt.

These are the actual proportions of the federal budget and debt, reduced to a level that everybody can understand. I found them on the political website Wizbang. If there is any greater proof of our national spending dysfunction -- our need to talk less about tax plans and more about cutting spending -- I haven't a clue what it could be.

To compare federal spending to an American family's, all we have to do is knock off eight zeroes from the federal numbers. Check it out:

U.S. Financial Position

  • Tax Revenue: $2,170,000,000,000.
  • Federal 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.


Proportionate American Family Budget

(The federal budget, with eight zeroes knocked off.)

  • Annual Family Income: $21,700.
  • Money the Family Spent: $38,200.
  • New Debt on Credit Cards: $16,500.
  • Outstanding Credit Card Balance: $142,710.
  • Recent Household Budget Cut: $385.

This American family is one cash-hemorrhaging puppy. It knows how to get out of debt -- stop overspending. But it hasn't the will to do it, so ingrained are its spending habits. Borrowing is a way of life. Cut spending? Too hard.

That's our gone-haywire government.

Looking at Congress as a family, its big cutting effort removed an equivalent $385 out of an annual $21,700 budget -- hardly a drop in the bucket. Meanwhile, it added $16,500 in new spending.

Real American families, on the other hand, know that if they spend more than 50 percent of what they earn and fail to pay down their credit card debt, they'll go under quicker than a lump of sugar in a cup of coffee.

Forbes Magazine acknowledges that most Americans understand the financial crisis better than Washington. In a story last week about the economy during the upcoming holiday season, author Ericka Morphy predicts consumers shopping for Christmas this year "will find just the right mix of gift purchases, personal spending and savings strategies, all the while staying on a tight budget, but hey, somebody has to set an example for Congress."

The article also predicts another U.S. credit rating downgrade before the end of the year. Moodys Investors Service and Fitch Ratings are on the brink. And if one of them decides to lower our rating, "expect the worst." They will have reason, too. The deadline for the congressional supercommittee to identify $1.2 trillion in deficit savings by Thanksgiving approaches fast. Says the author, "Bank of America Merrill Lynch doesnt think the supercommittee will be successful."

By the end of 2011, the Office of Management and Budget expects the gross amount of federal debt to exceed the size of America's entire economy for the first time in over 65 years.

Tax plans aren't cutting the mustard. Won't some 2012 presidential candidate please present a viable plan for cutting government spending? Something, at least, to inspire congressional leadership. And won't the voters in this country hold their congressmen's feet to the fire to do what they have to in their own households and make serious, honest-to-God cuts in the bloated federal budget?

Reach Nancy Smith at nsmith@sunshinestatenews.com or at (850) 727-0859.

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