Amidst all the election year talk about how a government needs to use the same economic principles that govern typical household operations, a complex picture is dumbed down until it begins to look–and annoy–like a mime. The 80% of citizens who believe they are above average no doubt also believe they understand the complexities of the financial landscape and how it works: I ought to, Joe Q. Public figures, because I balance my checkbook and (generally) make more than I spend.
But forget about the complexities involved in stewarding America’s massive economy. Let’s just take one company. What would our responsible citizen think about Sprint Nextel? The third-largest telecom company hasn’t made a profit in 5 years. Its wilted stock price is down 90%. And it has more than $15 billion worth of debt. Were it a household, you might say Sprint is under water. But plenty of analysts think the company is ready to rebound. It’s been cash flow positive for 3 years. Cash flow positive but unprofitable at the same time. Got it? It also has 49 million customers, more people than will likely vote for the next president, who will promise the country to “put its house in order.”