11/23/2023 0 Comments Reveals daily for time millionScaling numbers to the realm of the familiar harnesses our intuition toward understanding relative sizes. Here, we’ve scaled monetary amounts so that “1,000,000” comprises one unit, then equated that unit to a familiar – and paltry – quantity, one penny. When assessing a trillion-dollar expenditure, debating a billion dollars is quibbling over $10 on a $10,000 purchase. On the same scale, one million pennies, or $10,000, represents a trillion. Let’s run through that again: If one penny represents a million, then one thousand pennies, or $10, represents a billion. In an innumerate world, this is what passes for fiscal justice. On the bright side, we recovered $1.65 in executive bonuses. The Panama Papers document at least $200,000 missing from the world economy. ![]() Let’s find out: On a scale where a million dollars is one penny, the AIG bailout cost taxpayers $1,250. (The recently published Paradise Papers paint an even more extensive picture.) On the bright side, we recovered $165 million in bonuses from AIG executives. The Panama Papers document upward of $20 trillion hidden in a dark labyrinth of shell companies and other tax shelters over the past 40 years. The bailout of AIG after the mortgage-backed securities crisis cost more than US$125 billion. ![]() We use “back of the envelope” calculations to orient our intuition. Spock, scientists and mathematicians are not exacting mental calculators, but habitual estimators and analogy-makers.
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