The hardest job I ever had was teaching five-year-old boys to play baseball. It was fun, but hard. Hard because they have a very short attention span and you have to tell them everything. Sort of like reporters and politicians.
One useful thing I learned from coaching baseball is the value of starting at the very beginning. This is first base. This is how you run to first base. Don’t throw the bat. The great UCLA basketball coach John Wooden knew the importance of basics. That’s why he started with shoelaces — teaching his players how to tie their shoes correctly. That way they would not get blisters or sprain an ankle and miss a game.
So, in honor of Coach Wooden, I’d like to throw out a few economic basics. The inspiration for this is the publication of the Economic Report of the President. You’ll learn a lot by reading the report, but I suggest you start with the statistical tables in the back (Appendix B). They are the economic basics, the place you will find all sorts of critical information on how the game works.
How big is the U.S. economy? This is the home plate of the economy. $15.3 trillion. If you hear someone talking about a $10 billion hit to the economy, just remember the economy is 15,300 billion dollars! Also, the size of the economy underscores just how important it is to keep the economy growing. 3% growth adds $450 billion to the economy!
How much of the economy is consumer spending? $10.9 trillion. So when you hear people talking about boosting consumer spending, keep in mind that that requires moving a huge number. Also bear in mind that the U.S. consumer spends a lot. This is a big playing field! No wonder everyone wants to get into our market!
How much does the U.S. export? We ship goods and services worth $1.8 trillion to the rest of the world last year. That’s a lot, but remember home plate. Exports are a pretty small slice of the economy — about 12%.
How big is the labor force? 153.9 million people are available for work in the U.S. That’s fallen by about one million people since the Great Recession began. Ouch. But consider this: China’s working-age population is 1 billion. If we want to compete, we’ll have to get a lot of productivity out of everyone on the team. Coaching teaches many important lessons!
How much do we owe on our homes? Mortgage debt in the U.S. stood at $10.3 trillion for residential family houses. That’s down $831 billion from pre-bubble levels.
So that’s a little bit on the basics. If you want to know how to throw a changeup, I’ll call in my pitching coach!