Saturday, December 11, 2010

A Billion Dollars is Heavy



I was listening to Rachel Maddow yesterday and learned an interesting little tidbit: A million dollars in $100 bills weighs 22 lbs. You might want to find out what Ms. Maddow was talking about. Me? I went off on a tangent.

It’s hard to get your head wrapped around a billion dollars. I’ve showed you a picture of a billion dollars. The math ought to be pretty straightforward for all of us. If a million dollars weighs 22 lbs., then a billion (1,000 million) dollars in cash weighs 22,000 lbs. That’s 11 tons.

Remember the $3.7 billion-dollar man? Paulson? If he could convert that year’s income (that’s right, one year’s income) to cash, it would weigh 81,400 lbs. That’s more weight than a C-130 can carry. (Okay, more than it’s supposed to carry. You get the point.)

Payload: 45,000 lb (20,000 kg)
Useful load: 72,000 lb (33,000 kg)


It’s not a problem really. Paulson can certainly afford two of them. Well, actually, he could buy 59 of them with one year’s earnings.

”Unit cost US$62 million”

According to Forbes, there are 402 billionaires in the United States. Do you really think these guys need a tax break?

The thing that bothers me is the power that kind of money bestows on someone. Here’s another way to think about it. The most expensive Senate race in the country cost a little under $50 million. Theoretically, one third of the Senate is up for change every two years. That’s 33.3 Senators. If you could funnel $50 million to all 33 (and one third), you would spend $1,665,000,000. Paulson would still have $2 billion left over to spend on the House.

That’s a lot of influence. If you were so inclined to spend it on such things.

I want you to take a look at this list -- Forbes400 - The Richest People in America. Scroll down and look at names on numbers 4-9. Every one of them a Walton or Koch. That would be the Wal-Mart ”We Crush Unions” Walltons and the Koch brothers that financed the Tea Party movement. And the Supreme Court said they can spend an unlimited amount of money on political campaigns now.

Do you understand why the Republicans want to make sure the rich keep their tax cuts too? And they’re not scared of infuriating 15 million unemployed Americans by holding unemployment benefits hostage to get it done either. Imagine being able to thumb your nose at 15 million voters. (Obama won by less than 10 million votes. ) As we used to say, way back when, that’s heavy.

Don Brown
December 11, 2010

3 comments:

John Milton said...

"According to Forbes, there are 402 billionaires in the United States. Do you really think these guys need a tax break?"

Once you decide to implement a system based on "need" then it becomes the politician's job to determine who needs how much money. You stumble down the "From each according to his ability, to each according to his need" pathway.

In 2009, the median household income was $49,777. Did your household make more money than that? If so, why would you need any more money than the median household? Are you being greedy for wanting to keep what you worked for?

Paulson is an aberration. Nevertheless, he made money by working hard and taking risk. Paulson stood to lose bunches of money if the real-estate market continued on it's historical path. As for the influence his money can buy, according to The last sentence in Wikipedia, "Paulson contributed more than $140,000 to political candidates and parties since 2000, with almost 2/3 going to Democrats."

Don Brown said...

John,

I'm not asking for a tax break. Quite the opposite.

http://gettheflick.blogspot.com/2007/03/raise-my-taxes-please.html

I didn't say influence was limited to Republicans. But in a contest where "The Big Boys" are allowed to buy influence, the Dems (and the American people) will lose.

You might call this "working hard". Some might call it fraud.

http://www.nytimes.com/2010/04/17/business/17goldman.html?hp

Thanks for reading.

Don Brown

John Milton said...

"Some might call it fraud."

I completely agree that Goldman was wrong when it had a portfolio of junk to sell and they told potential buyers the CDOs were a safe investment. We'll see where the SEC charges lead.

I guess we part ways in saying that hedge funds, who analyze a market direction correctly, are committing fraud. In the Goldman case, I think the SEC has made that distinction as well.

If you haven't seen it, I thought the CNBC "House of Cards" two-hour special was a comprehensive overview of what happened between 2003-2008. In the end, I came away putting most of the blame on the investment rating firms stamping AAA+ on anything that didn't smell like dog poo.

Thank you for writing. I enjoy your blog and your photos.