How Would You Spend $1 Trillion Dollars?

How Would You Spend $1 Trillion Dollars?

It is tax time again. Where do your taxes go? Would you rather see your tax dollars spent better? If you could be in charge, how would you spend $1 trillion?

Budgets are about choices. It is about choosing what you can do, or not do, with limited resources. Congress sets spending priorities each year in the Federal “discretionary” budget. They decide whether to spend more on education or tax breaks, cancer research or food stamps, space exploration or housing assistance, diplomacy or bombs.

The Federal budget is huge and complicated. The budget can be confusing because people are not comparing apples for apples. As an example, progressives say the “military” receives 55% of the budget. Conservatives say “military” is only 16% of total spending. Actually both are true! The “military” gets over half of the discretionary budget. But total spending includes more than the discretionary budget. So when you look at that pie the military only gets 16%. How you count the beans makes a difference!

The National Priorities Project is a non-partisan, non-profit organization makes the Federal budget understandable (www.nationalpriorities.org ). They break down the Federal budget into categories so citizens can better understand where their money is going.

Four graphs tell the story.

There are three basic parts of Federal spending. Mandatory spending is 65% of the total. Discretionary spending is 29% and interest on debt is 6%.

In 2015 the federal government spent about $3.84 trillion.

Mandatory spending includes all payments that must be paid by law. Interest on the debt for example. Social Security and Medicare payments must be made. These are called “entitlements” because the payments are based on eligibility not how much has been allocated. Congress cannot stiff grandma on her Social Security because they are in a tiff with the President over spending.

A large part of total federal spending does go to people. But Social Security and Medicare are trust funds and are paid with payroll taxes. Social Security contributes nothing to the deficit. We have all spent a lifetime contributing to these social insurance policies.

Discretionary spending is the “budget” that is debated in Congress. It is funded by annual appropriations. Congress can set priorities by spending more or less on programs. This is where the investments in people, public infrastructure, and government operations (courts, law enforcement, defense, etc.) must come from.

This is also where “deficits” occur. When the government takes in less than they spend, the “budget” is not balanced and you have a “deficit.”

Military and “national defense” spending is the largest category at 55%. This percentage has remained basically constant for decades. As calculated by the National Priorities Project it only includes the Department of Defense, nuclear weapons costs, and the Overseas Contingency Fund (Iraq and Afghanistan). It does not contain ALL the spending that is related to war, or preparation for war. For example, the Veterans Administration and veterans benefits is not included. The Center on Defense Information, a conservative think tank, says all national security related spending is 85% of the discretionary budget! They include defense-related costs in other agencies such as the Department of Homeland Security, Department of State, the FBI, Veterans Administration, and defense-related interest on the debt. Again, how you count the beans makes a difference.

In contrast, Veteran Affairs and Education each get 6%. Diplomacy and international affairs get only 3%. Many of the complained-about “welfare programs” get around 1%. It is not true that your tax dollars go for welfare queens and foreign aid give-aways.

If you could set the priorities, how would you spend the money?

Take the survey “How would you spend $1 Trillion?” at:

: www.surveymonkey.com/r/KLFPW9P

By Phil Anderson