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The feeling that government has grown larger than is good for the country and continues to grow unabated is anything but new. I am far from alone in decrying Big government. I also recognize that not everyone agrees with me about the too-bigness of the Feds, so I decided to try to figure out a way for all of us to get a better feel for just how big, big actually is.
I’ll start with some raw numbers. The median income in the U.S. is $62K. The revenue of the smallest of the Fortune 500 companies, Vistra Energy, is $5.4 Billion. The revenue of WallMart, the largest company in the world, is $500 Billion. This year’s Federal Budget is $4.4 Trillion.
I don’t know about you, but I have trouble getting my head around those numbers. I have a vague sort of feel for how big $1 Million is, but a $1 Billion? No way. Let’s try thinking about these numbers in a different way, starting with the median U.S. income represented by a soccer ball.
- $62K, the Median U.S. Income ≅ Soccer Ball
- $100K Income ≅ A bit bigger than a Basketball
- $1 Million Income ≅ A ball that would just fit in a room with a 9 1/2 foot ceiling
- $32 Million Income ≅ A ball that would cover an entire, 100-yard long Football Field (About 300 people in the USA – literally 1 in a million of us – makes that much money!)
- $1 Billion Income ≅ A ball that is almost 2 Miles High
- $5.4 Billion, the smallest of the Fortune 500 ≅ A ball that’s almost 10 Miles High
- $500 Billion, WalMart = A ball that stretches from New York to St. Louis (more than 1/3 the width of the USA)
- $4.4 Trillion, the Federal Budget ≅ Earth (7,917 miles in diameter)
Now, I feel pretty good about visualizing a round ball that fills a football field, but after that my brain fuzzes up. Let’s change the scale a bit and see if that helps. Let’s shrink that $32 Million football field-size ball down to a marble, which is about 4/10 of an inch in diameter. So a $32 Million income is now a marble.
- $32 Million ≅ A Marble
- $1 Billion = A 12 Inch Ball
- $5.4 Billion, the smallest of the Fortune 500 is now ≅ A ball just a bit taller than the average American Woman at 5 feet 6 inches
- $500 Billion, WalMart ≅ A ball almost 2 Football Fields across at 170 yards
- $4.4 Trillion, the Federal Budget ≅ A ball almost a mile high at 1,500 yards
OK, better, but just for fun let’s scale things up one more time. Let’s think of WalMart as a soccer ball.
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- $500 Billion, WalMart = A Soccer Ball with an 8.65 inch diameter
- $4.4 Trillion, the Federal Budget ≅ A ball that can accomodate a 6 foot 4 inch tall man standing upright inside of it
So again, think of a 6’4” tall guy standing inside of a giant ball. That giant ball is the Federal Government. The soccer ball the guy is holding is the $500 Billion behemoth, WalMart.
…and remember. Compared to an actual soccer ball, the WalMart ball is 900 miles across, and the Federal ball is as big as our planet!
That’s freakin’ big. Bigger, frankly, than anybody can truly conceive. Can Donald Trump truly comprehend how big Earth is? Or equivalently, how big $4.4 Trillion is? Could Barack Obama? Or any other President? Or any member of Congress? Or anybody at all?
Now let’s consider the National Debt. It currently stands at $22 Trillion. That’s 5X bigger than the annual national budget that nobody can possibly understand. Question: How much money would you need to buy up the entire Fortune 500? To acquire all of the stock – to become the sole owner – of all of those 500 giant companies that generate 2/3 of the entire U.S. GDP? You got it. $22 Trillion. That’s how deep in debt we are!
The Congressional Research Service estimates that in his first term, Trump will increase the debt by another $4 Trillion. Guess what the inflation-adjusted total amount spent by the USA to fight World War II was? You got it. $4 Trillion. That’s how fast our debt is growing!
Under Obama, the national debt jumped up by $8.75 Trillion. Guess the value of all the gold that has ever been mined in all of human history. You got it. $8.75 Trillion. In other words, our debt has been growing at an insanely high pace for a long, long time!
Finally, let’s consider the number of people employed by the federal government. Officially, it stands at 2 Million. But, ooooops, that doesn’t count contractors, and there are – ahem – a few of them. Like about 7.1 Million of them! In truth, the Feds employ well over 9 Million people! New York City, the largest city in the U.S., has a population of 8.6 million. I gotta’ tell ya’… I get a little creeped out thinking that it would take every single man, woman and child in the City of New York and then some to staff the Federal Government. Yikes!
A budget of $4.4 Trillion annually, growing by another $1 Trillion every year and administered by 9.1 million people.
Yeah… It’s not big… It’s mind-blowingly HUGE! But the hugeness is not the scary part. Growth is the scary part.
Take a look at the Federal Budget graph to the right. In 1901, the Feds spent $588 Million. The line in the graph looks almost absolutely flat from there up to the bump in the mid-1940s when World War II spending spiked. It levels out again, and then starts creeping up slowly in the 1970s, then just EXPLODES from the 1980s onward. The graph now goes darn near straight up!
Now let’s talk about control of budget growth. How is that accomplished? Shifting back to a private sector perspective makes answering that question easy. Competition – the “Invisible Hand” of the market – ensures that budget dollars are spent wisely. The private firm that does not spend wisely, and thus does not deliver high quality products or services at a great price, simply disappears. Poof! Gone! Of the Fortune 500 in 1950, for example, 440 – 88% of them – have gone POOF! Every year, 30 or so more Fortune 500 companies go POOF!. Same story for all the smaller companies. The POOF – POOF – POOF is relentlessly constant.
When it comes to public sector budgets though, I’m forced to ask, “Where’s the POOF?” There is no comparable competition. There are no comparable market forces. Without an overt act of Congress, programs and departments can just chug along forever whether or not they produce anything useful.
Do you trust the federal government audit and budgeting processes to be as brutally effective as private sector competition to ferret out and eliminate unnecessary spending? I sure as hell don’t.
“Sunset” laws – laws that expire along with all their allocated budget on a specified date – have been tried. They didn’t work. For the most part, the deadlines just get extended. Zero-based budgeting has been tried, with decidedly ho-hum results. Voting the Democrat bums out didn’t work. Voting the Republican bums out didn’t work either. All kinds of things have been tried and none of them worked out.
Face it, once a bureaucracy gets established, just like a living thing, it strives mightily to survive, thrive, grow and reproduce. And I’m not bashing bureaucracies here either. No organization can function without a robust, efficient, effective bureaucracy. The thing I can’t figure out is how to quickly kill off public-sector bureaucracies or parts thereof that are no longer functioning well or are even necessary any more. Without market forces, they just might live on forever and ultimately drive the whole country into bankruptcy.
There’s only one way I can see to eliminate the dead wood. Decentralize! Start chipping away at the Federal Government and transfer the chips to the States. At the same time, start chipping away your State Government and transfer those chips to the Counties. At the same time start chipping away at your County Government and transfer those chips to the Cites.
Ill-spent public money is one HELL of a lot more visible at the city level than at the county level. It’s therefore a lot easier to eliminate. Same holds true right on up the line the Feds.
I’m your Intentionally Vicarious host Todd Youngblood – actively advocating a Constitutional Amendment to begin shifting $2 Trillion worth of the federal budget to the states. Urging you to explore the Convention of States website for insight into how get the whole process started, and to read this for some additional insight. Oh yeah… and don’t forget to continue to have more fun than anyone else you know.
If this episode got your brain working and/or your blood pumping, please tell all your friends and colleagues about it..
Thanks for paying attention…