Here’s some basic federal spending data I ran into today and thought I’d share on the blog: where we send each penny of a federal spending dollar. When you think about tax policy as much as we do, it’s easy to forget that in the long run, spending pulls the tax policy cart. So here’s a list of the ten biggest draws of federal dollars. Personally, I’m always surprised by the size of “net interest on debt,” which devours 8-cents of every federal spending dollar. Pennies of Each Federal Dollar Spent on Various Programs, 2006 Estimate Function Amount Social security $ 0.21 National defense $ 0.19 Income security $ 0.14 Medicare $ 0.13 Health $ 0.10 Net interest on Debt $ 0.08 Education, training, employment, and social services $ 0.04 Transportation $ 0.03 Veterans benefits and services $ 0.03 All others* $ 0.06 Total $ 1.00 * Includes community and regional development; administration of justice; international affairs; natural resources and environment; agriculture; general science, space, and technology; general government; commerce and housing credit; energy; and undistributed offsetting receipts. Source: Office of Management and Budget, Analytical Perspectives, Budget of the United States Government, Fiscal Year 2007 (available at http://www.whitehouse.gov/omb/budget/fy2007/); Tax Foundation calculations.
