Imagine for a moment that you are a financial planner and you are advising a family that makes about $130,000 per year. Their total assets, including a house, stocks, and bonds, add up to about $660,000. They owe roughly $130,000. Over the past three years their assets have been growing in faster increments than their liabilities.
Now, if you were to add 8 zeroes to these numbers, you’d be dealing with an actual family in the real world — the United States of America.
Thus, when we treat the U.S. as one family, we can create a balance sheet that’s quite admirable: Assets: $66 trillion. Liabilities: $13 trillion. Owner’s Equity (or Net Worth): $53 trillion.
While this sounds great, the NRO contributer fails to mention unfunded future entitlements that will costs us trillions of dollars in the future.