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August 1st, 2011
From the Walton & Johnson Mailbag

Federal Budget 101

The U.S. Congress sets a federal budget every year in the trillions of dollars. Few people know how much money that is so we created a breakdown of federal spending in simple terms.
 
Let's put the 2011 federal budget into perspective:
U.S. income: $2,170,000,000,000
Federal  budget: $3,820,000,000,000
New  debt: $ 1,650,000,000,000
National debt: $14,271,000,000,000  
Recent  budget cut: $ 38,500,000,000 (about 1 percent of the budget) 
It helps to think about these numbers in terms that we can relate to.

Let's remove eight zeros from these numbers and pretend this is the household budget for the fictitious Jones family.
 
Total  annual income for the Jones family: $21,700  
Amount of money the Jones family spent: $38,200    
Amount of new debt added to the credit card: $16,500    
Outstanding balance on the credit card: $142,710  
Amount  cut from the budget: $385

So in effect last month Congress, or in this example the Jones family, sat down at the kitchen table and agreed to cut $385 from its annual budget.

What family would cut $385 of spending in order to solve $16,500 in annual deficit spending?

Bill Graper 


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