National Equity?

[hickph]

Here's one I sent in to Cecil the other day. Maybe someone here can help me with it.

Being that this is an election year, we hear constantly about the "national debt." Of course, our national debt is something around 5 to 7 trillion dollars.

Here's my question: What would the national equity of the United States government be? In other words, if all of the planes, tanks, monuments, gold, land reserves, etc. were liquidated, what would that total be?

This I think would give the layperson a better idea as to the debt-to-equity ratio of the U.S. government. Think of it like this: If a family has 200,000 dollars in assets but 250,000 in debt, then that is not a good debt-to-equity ratio.

Conversely, someone who has 200,000 in assets but "only" 50,000 is debt has a fairly healthy debt-to-equity ratio of 25 percent.

If anyone can enlighten me to a source to find out the "national equity" I would appreciate it. Surely, if the government pays someone to calculate our national debt, there must be some agency that knows roughly how much the government is worth.

[TNTruth]

The Federal government’s biggest asset is a huge cadre of government employees who routinely vote for representatives who promise even bigger government.

Outside of that, the Feds hold 700 million acres of our land in “public trust”. That sounds like a lot until you realize you’d have to sell it for $7,000 an acre to cover our national debt. The various office and court buildings around the country would bring a nice chunk of change, maybe $10 billion, or enough to run the government for about two days. The tanks, planes, and aircraft carriers would only be worth what a buyer offered; scary thought.

So, unless you’re ready to sell Yellowstone, the only way you can construe the Federal government as financially solvent is to look at their debt to earnings ratio. Right now that stands at about 2.5, and dropping. It’s not uncommon for a family earning $50,000/yr to hold a $125,000 mortgage.

[hickph]

Thanks for the note. I haven't seen the figures you mentioned at the end...but that gives me a good perspective.

One thing you always hear is debt as a percentage of GDP, which I'm not sure is a great barometer either. I just find it funny in this election year how we are hearing the traditionally tight Republicans saying that "a little government debt is OK," while the Dems are claiming they can "retire the debt" - Sure.

Personally, I would love to see the debt paid down more than anything. Theoretically, no debt would mean no long-term government bonds, which should mean lower interest rates.

But I'm confident the baby boomers will muck everything up for this Gen-X'er - grabbing more entitlement program goodies that will blow a hole in the budget for years to come.