The Real Price You Pay
So you’ve just purchased a new cell phone, laptop, PC, or high definition LED TV and you’re totally pumped because you got a great deal. Chances are you paid less money than your old model and the new replacement is faster, has more memory, and a better picture. What could be wrong? Well here is where the simple math comes in.
As we all know most of our durable goods that are smaller than a refrigerator are manufactured in China. It is short of impossible to purchase any electronic device that is not manufactured overseas, and even when we do purchase a product “built” in America, a lot of subassemblies inside, are in fact built in China as well. This unfortunately has led to a sluggish economy, closure of numerous factories in the U.S., high unemployment, and high under employment here at home.
OK, so here is the math. Let’s say you purchase a new TV, or PC or one major durable good per year. We will assign a dollar amount to it of $1,500.00. Now, the U.S. federal government will spend this year 3.77 trillion dollars. That was the 2014 requested budget. The total tax revenue was 2.8 Trillion dollars so we are now adding to the federal deficit by approx. 1 trillion dollars “again”. In addition to the deficit over 51% of the U.S. population now receives some type of federal assistance because of a lot of the jobs sourced overseas. When you factor the items above, over 40 cents of every tax dollar will go into paying the deficit, or assistance. If you are an average single wage earner making $50,000.00 you paid $8,428.50 to Uncle Sam last year. That means 40% or $3,371.40 dollars went to the deficit or out of work individual. That cheap TV or laptop isn’t so cheap any more. Even if it were double in price, we would still be getting a better deal if it was made in America, and that individual that was out of work, would be back to work, spending money and providing for their family. To break it down more simpily here is the arithmetic;
Total 2014 Federal Budget 3.77 trillion Dollars
Total 2013 Tax revenue 2.8 trillion Dollars
2014 Deficit 3.77 Trillion – 2.8 Trillion = 990 Billion dollars (note: the congressional estimate still lists the amount at 647 Billion). Not sure how they do their math.
Total Federal deficit to date 17.6 Trillion dollars
Total U.S. GDP for 2013 =17.2 Trillion dollars (we now owe more money than we produced in total revenue in one year).
Total Taxes a single adult earning $50,000.00 paid in federal taxes in 2013 =$8,428.50 dollars.
Total amount of the tax dollars used to pay deficit and federal government aid from the above amount 40% ($8,428.50) = $3,371.40
While overseas manufacturing cities flourish our major cities are declaring bankruptcy and are decaying. Every great society dating as far back to the Egyptians has started its decline when economic concerns are outweighed by the leader’s desires to stay in power. We need a balanced economy where products are designed, developed, and produced here where we can all enjoy the economic growth and prosperity, resulting in a lower required federal budget, thus resulting in a true lower cost of “high quality “goods.
- Senior Mechanical Engineer Robert Antonuccio, Goddard Technologies
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Goddard Technoloiges. Examples of analysis performed within this article are only examples. These examples should not be utilized in real work analytic products as they are based on limited and potentially dated open source information. Assumptions made within the analysis are not reflective of the position of Goddard Technologies.