At a time when not only are governments talking about taxes and expenditures in the billions of dollars, but multi-billion dollar corporations are also spending billions to acquire others (Pfizer’s recent offer of 119 billion dollars to purchase AstraZeneca), huge companies are sitting on billions of dollars in cash (Apple now has more than 159 billion dollars in cash on hand), and the number of billionaires in the US is now over 500, it might be useful to reflect on this number, which is really beyond the ability of many of us, certainly me, to comprehend. While you can get some astonishing facts about how much a billion is from Wikipedia and other sources, I offer here a few of my own modest examples.
First, for proportion, let’s take a brief glance at a million. A million is ten one hundred thousands, a big number but still fairly easy to comprehend. It’s a number that can come in handy during your retirement, because a million dollars invested at six percent annual interest will yield $60,000 per year, not too bad a retirement income and you haven’t touched your principal. Also, if you wished instead to invest in real estate, your million dollars would buy five $200,000 homes. Renting these homes for $1000 per month would get you $5000 per month or again, $60,000 per year. And you would own the homes.
But a billion dollars is an entirely different matter. First, you need to simply consider that a billion is a thousand millions. OK, what’s so hard about that you might ask. But multiply my above descriptions of a million by a thousand and you are really in the stratosphere. Investing the billion at six percent per year would yield $60,000,000, a staggering retirement income. If you extend the homes example in this way, investing a billion dollars in $200,000 homes, you will have 5000 homes, a small city, and your retirement income from them, calculated the same way would be $60 million per year or $5 million a month, really quite a difference, and again a pretty good income. And you would own the city.
But let’s look at a billion in some other ways to really get some understanding of how huge this number is. A Morgan silver dollar is .13 inches thick, making approximately nine in an inch high pile and 108 in a pile a foot high and 570,240 silver dollars in a stack a mile high. Got that? Well a billion silver dollars forms a column over 1750 miles high if my math is correct (feel welcome to check it). If I am right in my math, this is again well beyond human comprehension. And a stack of a billion one dollar bills at .004 inches thick would be over 63 miles high.
Some other facts about a billion dollars: if a billionaire spent one thousand dollars a day, it would take him (or her) over 2700 years to exhaust the billion. Well if it lasts that long, why not spend $10,000 per day, then it would last 270 years, or much more reasonable, spend $100,000 per day for 27 years. This too is beyond comprehension. How could anyone spend money at this rate?
And what about Sheldon Adelson, the repulsive billionaire who sought to buy the election for Republicans during the 2012 election? Do you think he’s going to go broke anytime soon spending a reported 150 million dollars on such causes? Well, with his estimated fortune of 21 billion dollars, he could do this again for 140 more election cycles, not counting the additional billions in future earnings from his sleazy casino empire. Thank God he’s old.
Some other illustrations:
- A billion minutes ago (1902 years), in 112 AD the Roman Empire ruled by the Emperor Trajan was doing quite well and Christianity was becoming a major religion.
- My son’s beginning salary as a New Mexico public defender attorney is $54,000 per year. If he received and saved every penny of his salary and never spent a dime, it would take him 18,500 years to save a billion dollars.
- If on the other hand my son earned a billion dollars this year, his daily pay (five workdays per week for 52 weeks for 260 workdays per year) would be almost 4 million dollars a day, or even more amazing, for an eight hour day, $480,000 per hour.
These then are a few illustrations of the size of this astonishing number. Governments tax billions and spend billions. The Pentagon budget is over 500 billion dollars. Companies are worth billions and buy and sell other companies for billions. So we toss around this term only rarely considering how big it is.
Really I don’t think anyone should earn this much or own this much. It’s obscene to have this kind of money. Yet as noted earlier we have over 500 billionaires in our country. When it’s virtually impossible to spend this kind of money, why would anyone want it? Maybe it’s simply the ultimate badge of extraordinary achievement. In an age when money so easily buys political power, perhaps having a billion dollars or so is a pretty heady experience because of the power it buys. What are the Koch brothers going to do with their billions other than make more billions or buy more politicians?
I am reminded of the great populist demagogue, Huey Long, governor of Louisiana and later Senator from that state who addressed exorbitant concentration of money in few hands in his “Share the Wealth” proposal in the 1930’s. The “Kingfish” had it right. This obscene concentration of wealth, the billions of dollars owned and controlled by so few individuals while millions are in need, should not be allowed in a democratic society.