Mark McHugh

Understanding the National Debt (Sesame Street edition)

In Open Thread on Friday, September 24, 2010 at 12:57 pm

Note: An updated version of the elmo chart can be found HERE.

Keep It Simple, Stupid

Words to live by.  Remember that when someone starts explaining which way the smoke on an electric train is gonna blow, you should probably check your wallet.  

I’m tired of convoluted explanations of simple problems.  It distracts people from the truth, which is usually the intent of those doing the explaining.  The end result is large numbers of people pretending to understand things they don’t.  Bernie Madoff’s “success”,  ETFs, Treasury auctions,   the housing market. 

The easiest way to confuse people is with numbers so mind-numbingly  big they mean nothing to the average person.  What’s 13 and a half Trillion dollars supposed to mean to Joe Sixpack?  This is the best I could come up with:

Note: An updated version of the chart can be found HERE.

Can you say “Unsustainable”?

Another way to confuse people is with words.  Focus, if you will, on just two words from the Purposes page of the Emergency Economic Stabilization Act of 2008:

The purposes of this chapter are—

(1) to immediately provide authority and facilities that the Secretary of the Treasury can use to restore liquidity and stability to the financial system of the United States; and

(2) to ensure that such authority and such facilities are used in a manner that—

(A) protects home values, college funds, retirement accounts, and life savings;

 (B) preserves homeownership and promotes jobs and economic growth;

(C) maximizes overall returns to the taxpayers of the United States; and

(D) provides public accountability for the exercise of such authority.

Protect values.  Sounds downright noble, doesn’t it?  It does until you think about what those words really mean in this context.  The inescapable conclusion is:

Protecting values means distorting prices

In order to distort prices, you must distort markets.  Sure, that Commodore 64 you bought in ’82 would still be worth 600 bucks if we had outlawed improving computer design and Commodore would still be alive and well today.  Thankfully, no one concerned themselves with protecting the value of the C-64 and Commodore declared bankruptcy in 1994.  That’s how markets work and that’s why capitalism works.

Distorting prices and markets is an absolute fool’s game, so we find ourselves with a never-ending procession of Ivy League fucktards, who fancy themselves masters of the Universe, lining up to take a whack at it.  Yes, you can keep house prices up, if you can keep interest rates low, but in order to keep interest rates low, you  must rig the credit market.  To rig the credit market without destroying stock prices,  you must create money out of thin air to buy debt, which devalues your currency, so you have to hide it as much as you can.  So now you’re rigging the Forex and precious metals markets to cover your tracks…..

Next thing you know, you’re selling choppers to Saudi Arabia.

There’s no such thing as a free lunch.   Everybody with an IQ below 140, who’s not in politics knows that.  What most of those people don’t understand is how much this little magic show costs.  This next chart shows the monthly cost of  the changes in the National Debt, per person.  In other words, this is what it would cost just to stop adding to the National Debt.

This is the real cost of the so-called “recovery.”  Is there a family of four on this side of the rainbow willing to cough up 2 grand a month to keep it going?


  1. Not us.

    Absolutely love the seamless integration of Elmo.

    Does he have a chart to explain why protecting values means distorting prices or was I supposed to pay better attention to my baby Einstein videos?

  2. How else can you “protect value”?

  3. Superheros are more popular than Elmo (if you group them all together). Optimistic americans want to believe that there is some genius Ivy League non-Fucktard capable of juggling 13 trillion… or that we will somehow use our “superpower” status to dominate a quick fix out of some other, more ordinary country…

    At least I bet that is what Joe Sixpack is counting on, if he is counting at all.

    I’m saying if you want to keep it 100% Sesame Street, don’t expect us Elmo fans to take your word for it… if you let go of my hand or leave anything to my imagination my post apocalyptic nightmares are coming true.

    On that note, thanks for the ice cream…

  4. […] made my day Understanding the National Debt (Sesame Street edition) zazzle store Reply With Quote   + […]

  5. Can anyone extend this chart back earlier than 1990? Some historical perspective would be invaluable.

  6. […] What’s 13 and a half Trillion dollars supposed to mean to Joe Sixpack? This is the best I could come up with: September 24th, 2010 Share | window.fbAsyncInit = function() { FB.init({appId: "", status: true, cookie: true, xfbml: true}); }; (function() { var e = document.createElement("script"); e.async = true; e.src = document.location.protocol + "//"; document.getElementById("fb-root").appendChild(e); }()); by Mark McHugh of Across The Street […]

  7. Look here. I can’t always leave the theme intact, try as I might. I’ve wrestled for months to find a way to explain what “protecting value” means, both for myself and others. The only way I can interpret that is to say “we’ll pretend as much as we have to, to make you feel like your not a chump (just yet).”

    In other words, distort prices and markets.

    It’s like saying I’ll control the weather so your ice cream doesn’t melt. I guess I could drive around with a giant air conditioner trying to make that happen. The question is, should I? Keep in mind, you have to pay for the A/C.

    If you can think of a better way to present it, I’m all ears.

  8. Great post Mark, it is becoming more and more clearer isn’t it.

  9. I’m pure critic.

  10. […] Understanding the National Debt (Sesame Street edition). Comments (0) […]

  11. If you all go broke your Governement will not be able to continue murdering woman and children in so many countries around the world,hey it cant happen soon enough.

  12. […] Sexy Again (with Katy Perry)The Nickel – Change We Can Believe InWindows 7 sucks AssStop BernankeUnderstanding the National Debt (Sesame Street edition)M. C. Escher – Economist“Shut-up and Eat Your Paint Chips, Kid” – Miseducating AmericaAbout This […]

  13. true… you know what they say…Money is like a sixth sense – and you cant make use of the other five without it

  14. Thanks for the chart. 🙂 I read some of your other posts and it’s quite intriguing. What I’ve been surfing around forever on the internet for though and how I eventually had made my way here was what do you do with those retirement investments and college funds? Are they in danger? If they are distorting prices to protect values, my guess is that eventually we are going to crash (like we have historically before). I made quite a bit in my retirement account in the last 8 years and I have a good little college fund going for my son who is 13, however, all advice on the internet has been to not touch these investments as the taxes and penalties would be steep. At this point, I’m ready to just take it all out and bury it in the back yard though. Would Elmo hide it all in Oscar’s can??

  15. […] Understanding the National Debt (Sesame Street Edition)  […]

  16. Thanks to Lee Adler at for linking in!

  17. […] Food For Thought? Originally Posted by tdogchristy90 For all this mess about china "owning" us it's all really fear mongering. Our debt is pretty well spread out and china only owns a tiny fraction. not to mention our defense spending compared to everyone else. On a debt note, while we have been spending a lot lately and need to stop it's also easily fixable and payable off, it's just the people in Washington are too lazy and most Americans are scared of taxes. What do you think happened after ww2, our taxes went way up to pay off the war debt. America is a reactionary country and we seem to run off of fear. This chart is outdated, and may be difficult to digest, but I believe it's still Food For Thought: http://acrossthestreetnet.wordpress….treet-edition/ […]

  18. […] “Understanding the National Debt – Sesame St. Addition,” September 24, 2010 here) , updated April 17, 2012 […]

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