Saving $1.35

President Barack Obama held his first cabinet meeting today. He "made clear that relentlessly cutting out waste was part and parcel of their mission to make the investments necessary for recovery and long-term stability." The ruthless fiscal disciplinarian called for his cabinet to cut a collective 100 million dollars in the next 90 days. The White House blog has the story here and the fact sheet can be found here.

Now, Obama has admitted already that this is a drop in the bucket. However, he did say, "cumulatively they would make an extraordinary difference... $100 million there, $100 million here, pretty soon, even in Washington, it adds up to real money." How long would it take to add up to real money?

Let's put this in terms the average American understand. I have a graduate degree in math and even I have a hard time comprehending one trillion dollars. Consider the following table:

Sources: Obama FY2010 Budget proposal and U.S. Census population clock.

In this table, we compare the United States federal budget (as laid out in Obama's FY2010 proposal - summary detail available here) with the "average" American household. To get the "average" household, I take per capita GDP as household expenses (GDP is a measure of spending) and pro-rate the data to income and the desired savings.

$1.35... that is the equivalent savings to an American household. I can't imagine how Obama's cabinet could possibly scratch and claw at their budgets to find the equivalent of $1.35. That's pretty much like not ordering fries from McDonald's one time in the next 90 days. Everything else is business as usual.

It takes a lot of $1.35s to add up to "real money" - even for a household with $32k in annual income... especially when they are spending $48k per year.