Wednesday, March 04, 2009

A trillion here, a trillion there....

We used to joke about "a billion here, a billion there, pretty soon we are talking real money" to make a point about how a project had gone beserk.

Now a billion is small change. Robert Stanford, chairman of Stanford Financial stole "only" $8 billion from his shareholders. Compared to Madoff's $50 billion, Stanford came off like a mere petty thief.

Adding up all the known rescue packages out of DC plus estimated loans and commitments made by the Fed to bail out various institutions, we are talking between 2 to 10 trillion dollars.

What's a trillion? Let me share with you a recent CNN report shortened for easier reading:

"Senate Republican leader Mitch McConnell said that Americans have become desensitized to just how much money that is being spent.

"To put a trillion dollars in context, if you spend a million dollars every day since Jesus was born, you still wouldn't have spent a trillion," McConnell said.

CNN checked McConnell's numbers with noted Temple University math professor and author John Allen Paulos.

"A million dollars a day for 2,000 years is only three-quarters of a trillion dollars...
a trillion seconds is 32,000 years," Paulos said.

"The [Environmental Protection Agency's], for example, annual budget is about $7.5 billion. So, a trillion dollars would fund the EPA in present dollars for 130 years -- more than a century. Or the National Science Foundation or National Cancer Institute have budgets of $5 [billion] or $6 billion. You could fund those for almost 200 years," he said.

I think these down to earth examples provide an astounding perspective of how much taxpayers are spending to bail out incompetent senior executives running Wall Street and Detroit.

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