US and UK debt made simple

I found this on a discussion forum.

Remove 8 zeros from the US national figures and show it as a household budget.

• Annual family income: $21,700
• Money the family spent: $38,200
• New debt on the credit card: $16,500
• Outstanding balance on the credit card: $142,710
• Total budget cuts: $385

Here is the UK equivalent for 2011 (taking off 7 zeros)

Family income: £54,800 (including £25,300 of income tax and NI)
Family spending: £64,800
Credit card balance at start of year: £90,900
Interest on the balance: £4,300
Total amount added to the credit card: £14,300
Total planned budget cuts: £5,000

That shows what a mess we are in.

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7 comments ↓

#1 London News on 08.03.12 at 12:41 pm

Certainly we are but the austerity measures are shrinking the growth

#2 banger on 02.14.13 at 10:56 pm

No, the U.S. budget at least has no relationship to a family budget because the U.S. can create money as they need it. To make that comparison is naive and silly.

#3 Doug on 04.23.13 at 5:10 am

We would be in a mess . . . if our nations were households.

#4 Adam on 08.21.13 at 3:55 pm

Except a household can’t raise taxes or gather the £100bn lost every year through tax evasion… Stupid analogy really.

#5 Whatever on 08.21.13 at 9:28 pm

Man you seriously need to get a life

#6 dave on 08.22.13 at 7:10 pm

this is meaningless you obviously haven’t a clue about economics why don’t you stick with what you do know which is obviously very little.

#7 Huyton Freeman on 01.21.14 at 6:00 pm

and the “credit card balance” is not the “families” debt, it is the bankers debt!

As has been said, silly analogy.

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