Billions & Billions

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Recently I got a chain email from a friend, showing the magnitude of a billion.

  • A billion seconds ago it was 1959.
  • A billion minutes ago Jesus was alive.
  • A billion hours ago our ancestors were living in the Stone Age.
  • A billion days ago no-one walked on the earth on two feet.
  • A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

As I normally do with such things, I immediately went to snopes.com to find out how accurate it was. (bottom line: eh….close enough, although it was probably written in the early 1990s).

The interesting thing about it is that it apparently has gone through three phases. The first had just that bit above about billions. I guess the politics in that was too subtle for some people, so, more recently someone added a bit about Hurricane Katrina and New Orleans:

Louisiana Senator, Mary Landrieu (D) is presently asking Congress for 250 BILLION DOLLARS to rebuild New Orleans .. Interesting number… what does it mean? Well… A. if you are one of the 484,674 residents of New Orleans (every man, woman, and child) you each get $516,528. Or… B. if you have one of the 188,251 homes in New Orleans, your home gets $1,329,787.

Snopes dealt with this section as well, but not with their usually efficiency. They pretty much just limited themselves to checking the author’s math. (again, close enough, but not perfect, which is odd considering he gave very precise wrong values). Furthermore, apparently quite recently someone added a bit more, which Snopes doesn’t cover at all:

Washington, D.C
< HELLO!>
Are all your calculators broken

Accounts Receivable Tax
Building Permit Tax
CDL License Tax
Cigarette Tax
Corporate Income Tax
Dog License Tax
Federal Income Tax
Federal Unemployment Tax (FUTA)
Fishing License Tax
Food License Tax
Fuel Permit Tax
Gasoline Tax
Hunting License Tax
Inheritance Tax
Inventory Tax
IRS Interest Charges (tax on top of tax)
IRS Penalties (tax on top of tax)
Liquor Tax
Luxury Tax
Marriage License Tax
Medicare Tax
Property Tax
Real Estate Tax
Service charge taxes
Social Security Tax
Road Usage Tax (Truckers)
Sales Taxes
Recreational Vehicle Tax
School Tax
State Income Tax
State Unemployment Tax (SUTA)
Telephone Federal Excise Tax
Telephone Federal Universal Service Fee Tax
Telephone Federal, State and Local Surcharge Tax
Telephone Minimum Usage Surcharge Tax
Telephone Recurring and Non-recurring Charges Tax
Telephone State and Local Tax
Telephone Usage Charge Tax
Utility Tax
Vehicle License Registration Tax
Vehicle Sales Tax
Watercraft Registration Tax
Well Permit Tax
Workers Compensation Tax

STILL THINK THIS IS FUNNY?

Not one of these taxes existed 100 years ago…
and our nation was the most prosperous in the world. We had absolutely no national debt… We had the largest middle class in the world… and Mom stayed home to raise the kids.

What happened ? Can you spell ‘politicians!’ ?

And I still have to press ‘1’ for English.

Now, since Snopes dropped the ball on this on, I figured I’d do my part to correct the misinformation here.

First of all, as an aside, you can tell the additions were written by a right-winger, as they blame the $250 million on the state’s Democratic senator, when in reality the bill was co-sponsored by her and the state’s other senator, Republican David Vitter – which points to the other sure sign it was written by a right-winger – it’s riddled with errors.

The main error is that the money is not just for New Orleans, but for all areas damaged by Katrina – which includes large parts of Louisiana, Mississippi and bits of Texas. That pretty much invalidates his whole premise. But, even if it were just for New Orleans, his premise would still by wrong, because it’s not just to rebuild people’s houses, but to rebuild the entire city infrastructure: roads, schools, hospitals, levies, etc. I imagine Republicans would have might less of a problem with government if any of them actually understood how it works.

Which brings us to the third section of the email, where the writer just goes off the wall. By line count, it’s half of the whole thing, so clearing this guy like hearing himself talk. Too bad he was too busy typing away to bother actually fact-checking what we wrote.

Of that long list of taxes we didn’t have “a hundred years ago”, many, granted, we didn’t have, but mainly because for the most part, the thing being taxed didn’t exist (Phones, Social Security, Motor Vehicles etc). And we really didn’t have an income tax in 1908 – That came about in 1912. But, as for the rest – Real estate, alcohol, tobacco, marriage licenses etc — They pretty much all were taxed.

It’s also a bit questionable if we were “the most prosperous [nation] in the world” in 1908, as we really didn’t start moving past England, France and German until after WWI.

His assertion that “We had absolutely no national debt…” is total fantasy. In 1908, the national debt was $2,626,806,271.54 (adjusted for inflation that would be nearly $58 billion in 2008 dollars). Granted, that’s a lot less than the $9.6 trillion it is now, but we’ll get to that in a minute. The last time we paid off the debt was 1834.

As for “We had the largest middle class in the world… “, again, hard to measure — Do you count raw number of people (we probably win), or percent of population (in which case you have to look at England, France and German again).

Mom stayed home to raise the kids.” – Well, mom did stay at home then, but mostly to run the household, which didn’t have electricity, nor, most often, running water. She had to do this because her husband was working 10 hours a day, 6 days a week at a factory – earning about a dollar a day. She didn’t spend that much time raising the kids – because, starting at about age 9 or 10, they were with the father in the factory.

Oddly, the writer seems to be blaming the raising national debt on taxes. Maybe he’s a fan of Rush Limbaugh, since that’s one of his wacky ideas: “The best way to increase government revenue is to cut taxes”. But, in reality, it’s a lot like saying “The best way to pay your bills is to quit your job”. A much more reasonably plan would be “The best way to pay your bills is to quit your job, and get a better job”. Similarly we could say, “The best way to increase government revenue is to cut taxes, and direct the money to growing the economy”. But, like the job quitting plan, Republicans seem to leave off the last part — the important part – and are happy to let multi-millionaires use their tax breaks to pad out their trust funds.

Which brings us to the real causes of the national debt: Wars (historically) and Republican presidents (recently). The very first time the debt passed $1 billion dollars was during the Civil War. That was also it’s fastest raise (ten-fold in just two years). It floated around $2 to $3 billion for about 50 years, when it sudden raises nine-fold in four years just in time for WWI. Then a slight rise during the Great Depression (tripling over 11 years), followed by a big jump for WWII (five-fold in four years), reaching a quarter of a trillion dollars by the end.

The debt grew rather slowly after that, taking 30 years (till 1975) to double again. Then, under the Reagan administration so-called “Economic boom,” it triples, passing one trillion dollars for the first time. Overall, Reagan & Bush-41 combined brought the debt from under $1 trillion to over $4 trillion (340%) is just 12 years– with no significant war. In contrast, during Clinton’s 8 years, it raised only 31%. And we were poised to start actually paying some of it off. But with Bush-43, we’re back to the old pattern, up 66% in 7 years.

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