2008 Archives

Most of us have zero comprehension of $1 trillion

Excerpt

The following is from the Jan. 29, 2009, edition of The Dallas Morning News. Mike Davis, an SMU economist in the Cox School of Business, provided expertise for this story.

January 30, 2009

By ERIC TORBENSON
The Dallas Morning News

Call it "zero fatigue" – the malady of people weary of keeping track of the zeroes bandied about by politicians, bankers and television anchors to describe deficits, losses and stimulus bills.

"I knew I had it too when the few billion here and there in the House stimulus bill started to look small," said Bob McTeer, former head of the Federal Reserve Bank of Dallas who now works as a distinguished fellow at Dallas' National Center for Policy Analysis.

The worrisome zeroes lie in the economic meltdown. The annual budget deficit seems likely to tickle a trillion dollars in 2009 courtesy of the slowdown – even before tacking on a massive stimulus plan.

That's $1 trillion. One and twelve zeroes:

$1,000,000,000,000.

So how big is a trillion? Most folks have zero idea. . .

Understanding big numbers by how they break down per person may be the easiest way to get our minds around them, says economist Mike Davis at Southern Methodist University's Cox School of Business.

"The problem is that once we get into the 12-zero range, we just can't imagine what we're giving up," he said. "The usual graphics – piles of dollar bills bigger than the Rockies, etc. – may help a bit, but I think the real way to talk about it is to somehow describe what $1 trillion could actually buy."

Read the full story.

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