Saturday, February 14, 2009

Putting Things in Perspective: The Stimulus

Since the so called stimulus plan has passed, and will more than likely be signed into law early next week I thought I might take a bit of time to place the price of this in perspective. The face cost of the bill is in the league of $787 billion dollars, for some math purposes I will be using in a moment that is 787 followed by nine (9) zeros. (For those of you that may be reading this from other countries all amount are in US dollars. You may convert into your countries currency here).

Let us now presuppose that $100,000 US dollars. Is an amount that if earned annually would be more than sufficient to meet every need of an individual and take care of nearly every want. It is helpful to remember here that $50,233 was the average household income in America in 2008. So what I did was double then round off.

Now to get an impression of just how big this package really is. If an individual now spent exactly $1ooK a day it would take him/her 10 days to spend $1million. So every 100 days would be $10 million spent, 1000 days $100million, 10,000 days now gets us to $1billion dollars spent. This means it would take 27.4 years at a rate of $100K a day to equal $1billion dollars so at that rate it would take just a little over 21,536 YEARS to equal $787billion.

Even if we assume an expenditure rate of $100million a day it would take 10 days to get a $1billion, 100 for $10billion...for a grand total of 7870 days or 21.56 years at a rate of $100million a day to equal the size and scope of the stimulus.