Most people don't buy into these crazy numbers, but for some reason the politicians do.
If there's 1.5 trillion dollars in losses from piracy, that 1.5 trillion went somewhere. Into other industries, other items. If a consumer is faced with free stuff (piracy) their consumption is pretty much infinite.
However if they have to pay, they have to outweigh the costs with whatever else they're buying. With how tight the economy is, and how far people are already going into debt, its a good bet, if given the choice, people might be chosing music/movies in that scenario.