Sunday, October 7, 2012

NPR is a pack of gum

Let's talk about NPR.

As the Lede reported this week, Mitt Romney's targeting of the NPR budget reflects a widespread misunderstanding of how little the US government gives to public broadcasting.  While $500 million dollars sounds like a lot of money, this is only the case because most of us (myself included) don't easily differentiate between a million, a billion, and a trillion.

So, what is $500 million dollars in the grand scheme of things?  I have occasionally returned to a little economic metaphor that I posted last year, from Harvard economist Philip Greenspun. He cancels out some zeros and explains the US debt in these terms.
If we divide everything by 100,000,000, the numbers take on more sensible proportions.

We have a family that is spending $38,200 per year. The family’s income is $21,700 per year. The family adds $16,500 in credit card debt every year in order to pay its bills. 
At the time, he explained that the "historic" budget cut of $38 billion dollars was actually nothing at all.
After a long and difficult debate among family members, keeping in mind that it was not going to be possible to borrow $16,500 every year forever, the parents and children agreed that a $380/year premium cable subscription could be terminated. So now the family will have to borrow only $16,120 per year.
Putting aside the suitability of the family or the household as a metaphor for the economy, I find this method of understanding large numbers very helpful.  In this context, how much does NPR cost the government?  The massive figure of $500 billion is the equivalent of $0.50.  Cutting funding for NPR is the equivalent of foregoing a pack of gum when your house is underwater.

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