Thank you!
Your support is sustaining the future of local news in our communities.

Amazingly large numbers

I am going to express several amazingly large numbers in terms of how many millions they represent. I believe most of us can relate to the concept of millions, millionaires, etc. But we have a very hard time relating to a billion (it’s 1,000 million) and we are essentially unable to conceptualize what a trillion means (it’s 1,000,000 million). So, let’s make millions our benchmark.As I write this column, Apple Computer is selling for about $629 per share. It is now the most valuable publicly held company in the world — not just now — ever. Its market capitalization, the value of all its shares times $629, is approximately $587 billion ($587,000 million). ExxonMobil, the second highest valued entity, is at $404 billion. What’s perhaps more amazing about Apple is that, at their last reporting date in December 2011, they had a hoard of cash and investments of over $97.5 billion. Try that on for size. That’s $97,500 million of liquid assets. These giant figures set a context for even more amazingly large numbers.The US of A’s spending (there’s no budget because the Senate has not passed one in more than 1,000 days) per annum is north of $3 trillion ($3,000,000 million. Not a misprint!). But our taxes and other sources of revenue are over $1 trillion short and have been for each of the last three years. We’ve added more than $5 trillion to our primary debt since the start of 2009, to a level of about $16 trillion, and are projecting, at current levels of spending, to keep piling new debt up at a rate of a trillion or so per year for the foreseeable future. One trillion is 10 times in one year what it took the world’s most valuable company 35 years to accumulate. Sixteen trillion is 164 times the size of Apple’s cash hoard. And that is just the primary debt.In addition to our primary debt, we have north of $50 trillion (50,000,000 million. Yes that’s right – 50,000,000 million) of unfunded liabilities for Social Security, Medicare and Medicaid. And still counting. That’s 512 times the size of Apple’s cash pile. We have piled up the largest debt pile in the history of the world without including the unfunded entitlement liabilities. Including the entitlement liabilities, our debts are totally mind boggling. Nearly $70 trillion. No company, no government, no entity on earth has that kind of money. About the only thing that is keeping our economy from going from weak growth into a huge tailspin is that the U.S. dollar is still the reserve currency for many cross-border transactions.u u uThese debt numbers are not politically motivated, not Democratic, not Republican, not Independent. They just are facts. We can keep refinancing the primary debt as long as someone is willing to keep lending to us. Keep in mind, however, that if interest rates were to climb, the cost of servicing the debt would climb by about $160 billion ($160,000 million) per year for each 1 percent rise in rates. Predictably, at some level of debt, the market will conclude that the United States has such a high debt relative to its overall economic output that no more lending will be forthcoming.And yet, incredibly, the current administration proposed a budget that dealt with none of these fundamental budget-busting overspending issues. That budget was voted down unanimously in the U.S. House of Representatives, 417 to 0. For the first time in several years a budget was proffered that contains a bi-partisan plan, for Medicare reform, which was coauthored by Wisconsin Rep. Paul Ryan (R) and Oregon Sen. Ron Wyden (D), which does begin to tackle the difficult issues which are baked into the debt and entitlement numbers I’ve discussed above. That budget passed in the House of Representatives, but will not be brought to the floor of the Senate for a vote by Senate leader Harry Reid (D) of Nevada.I have read several critiques of the Ryan/Wyden Medicare plan, including a scathing critique from President Obama, that claimed it would send Medicare into a death spiral, reduce college aid, chop funds to autistic kids, etc. And I thought: That’s impossible. Medicare’s already in a financial death spiral. We are overspending on so many fronts. It’s not true that cutting spending will cause all these horrific results. What is certain is that it is a numerical lock that by not becoming more efficient in how we help the poor, the sick, the elderly, the college students, our kids, that we foreordain suffering on all these groups. We need to makes substantive changes to pull back from that otherwise numerically predetermined fate.In Hemingway’s “The Sun Also Rises”, someone asks Mike Campbell (played in the movie adaptation by Errol Flynn, for you old movie buffs): “How did you go bankrupt?” Comes his reply: “Two ways. Gradually, then suddenly.” The United States is in the gradual stage of going bankrupt. Check out Greece for the sudden stage. It is not too late to pull back. But our amazingly large debt numbers (nearly $70 trillion or $70 million million or $70,000,000,000,000) cannot be ignored. We need to ask candidates of both parties in the 2012 election where they stand on our numerically certain debt crisis. Are they part of the ongoing problem or active participants in the solution?Richard Shanley, CPA, is a retired audit partner of the accounting firm of Deloitte & Touche. He lives in Salisbury.

Latest News

Cornwall Historical Society celebrates Connecticut’s Black patriots

On Saturday, Oct. 24, at the Cornwall Historical Society, author and genealogist John Mills will breathe new life into the stories of some of Connecticut’s more underappreciated patriots. The reason these heroes were forgotten? They were Black.

At a time when white colonists were fighting for their own liberty and political independence, many Black men who fought alongside them remained enslaved. Some risked their lives only to return to bondage. Though enslaved people were promised freedom from both sides of the Revolutionary War in exchange for their service, Great Britain, too, was still deeply dependent on slavery. For Black people in America, the war presented both extraordinary risks and uncertain paths to the freedom that white colonists were demanding for themselves.

Keep ReadingShow less

A sanctuary for second chances

A sanctuary for second chances

Stephanie Saetta runs Charlie Chicken Bones, a sanctuary in Salisbury.

Madi Long
You only get one or two of these soul connection dogs, so I do this in his honor.
— Stephanie Saetta

Stephanie Saetta has spent much of her life caring for others. A physician at White Plains Hospital, she has another calling at home in Salisbury — one that has four legs and a wagging tail. She runs Charlie Chicken Bone Sanctuary, a nonprofit dog rescue that brings dogs from overcrowded pounds and the streets of Texas to foster homes in northwestern Connecticut, where they can begin again.

The sanctuary is named for Charlie, the dog who taught her how special a bond between a person and rescue animal can be.

Keep ReadingShow less
Big ideas come to Lenox for inaugural field festival

Hunter Runnette, founder and board chair of field, has spent years fostering arts and cultural programming in the Berkshires.

Provided

What do joy, gardening, artificial intelligence, the American experiment and the creative process have in common? Quite a lot, as it turns out, at least when some of the world’s most compelling thinkers get together to talk about them.

From Friday, Oct. 23, through Sunday, Oct. 25, Lenox, Massachusetts, will host the inaugural field festival, a three-day gathering of writers, artists, scholars and cultural figures at Shakespeare & Company. Billed as a festival of ideas, entertainment, learning and discovery, field brings together an impressive roster of voices to explore everything from the deeply personal to the profoundly political.

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

The Pink House AM is serving up community

Mare Rubin and Maggie Levine of the Pink House AM.

Madi Long

It all started with a yoga class. Mare Rubin was working on her second act after leaving the Upper West Side, where she’d raised a family and worked in corporate marketing. Newly empty nesters, she and her husband decided to move to the wilds of northwestern Connecticut, where they had spent 15 years as weekenders, to see what life in the woods had in store for them.

Rubin started teaching yoga classes at the Union in West Cornwall, a space designated by the town of Cornwall as a community hub with couches, Wi-Fi, occasional events and a growing yoga class schedule. She was adjusting well but missed one important thing about city life: a casual coffee shop.

Keep ReadingShow less
Sons of Astro are musicians, friends and bandmates — in that order

The Sons of Astro will be at the Common Pub in Housatonic on Oct. 24 and the 2nd Home Lounge in Winsted on Nov. 14.

Provided

No matter where they are in the world, musicians seem to find other musicians. There’s a shared language, a shared experience of being on stage and performing, and a shared enthusiasm for making those melodies by themselves or together. Such is the case with Norfolk and Brooklyn-based cosmic Americana band Sons of Astro.

That magnetic musicians’ bond drew Brooklyn-based singer-songwriter and multi-instrumentalist Mike Cobb into the orbit of singer-songwriter and multi-instrumentalist Matt Statler. The two neighbors took to each other right away and were soon playing open mics together. As an ethics professor at NYU’s Stern School of Business, Statler made the case that if he sat in for Cobb’s set and Cobb sat in for Statler’s, they could play together and double their stage time. Clearly, these men wanted to make as much music as possible. That became a little harder when Cobb and his family moved up to Norfolk, Connecticut.

Keep ReadingShow less
One more weekend to get inside the art at ArtEast

The participating artists in this year’s ArtEast open studios.

Provided

ArtEast’s annual October Open Studio Tour is already underway, but there’s still one more weekend to step inside the creative worlds of artists working throughout eastern Dutchess County. On Saturday and Sunday, Oct. 24 and 25, artists will once again open their studio doors, inviting visitors to see where the work happens, meet the people who make it and perhaps discover something worth taking home.

Now in its 21st year, the ArtEast October Open Studio Tour offers a self-guided journey with participating studios in Holmes, LaGrangeville, Hopewell Junction, Pawling, Patterson, Poughquag and Wingdale. Visitors can explore painting, photography, sculpture, mixed media and other artistic practices, and get some leaf-peeping in at the same time.

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.