Editor: Paul L. CaronPepperdine University School of Law
Sponsored by Wolters Kluwer
Tuesday, April 14, 2009
By Paul Caron
The Center on Budget and Policy Priorities has published:
Where Do Our Federal Tax Dollars Go?:
Where Do Our State Tax Dollars Go?:
Tax, Think Tank Reports | Permalink
Listed below are links to weblogs that reference Where Do Our Tax Dollars Go?:
"percentages may not total 100 due to rounding"
Shouldn't that read "percentages may not total 100 due to deficit spending"? I mean, they take $100 from us but spend, what, nearly $150 this year?
Posted by: Mr. Bingley | Apr 14, 2009 1:44:10 PM
Defense AND Security - I wish that was broken down into the two parts. I suspect "Security" is lumped in so as to make sure that category ends up higher than the Medicare, Medicaid and SCHIP one, and tied with FICA...
Posted by: LTC John | Apr 14, 2009 2:02:33 PM
This reminds me of the fringe charities that include a "fun-fact" in each request for more money. That changes the classification of an expense from "fundraising" into "Public education".
A supposed charity that spent 50% of its funds on fundraising would be investigated. Spending 50% of its funds on "Public education" is seen as worthy.
So we have pie charts showing nice labels for the overall purpose of each activity. Where is the allocation for waste, fraud, and abuse?
I seem to remember that government wellfare agencies distribute in cash and direct assistance only a small part of the funds they administer. I don't think the government tracks the resources that are distributed, in comparison to the resources used for management.
I quickly looked up the following. These are anecdotal and fit my bias. I would appreciate better or contradictory information.
An accountant in 1990 asked his state “What is the overhead portion of the State’s welfare budget?” The immediate answer: "Well, this is an interesting question. We have never encountered this question before."
Welfare Needs and Welfare Spending
One fourth of wellfare spanding in 1982 would have raised all poor people out of poverty if directly distributed. Three-fourths disappeared into administration.
"(From 1982) Based on the latest available census data 101.8 billion properly distributed, would have raised to the poverty threshold in 1982 the incomes of all Americans whose pre-welfare incomes were below the threshold. Allowing 1.5 percent-the Social Security Administration's rate--for administrative overhead it would have been possible officially to eliminate poverty in the United States at a cost of $103.3 billion, 25.6 percent of what the government actually spent trying, but failing, to meet that goal"
Posted by: Andrew_M_Garland | Apr 14, 2009 2:07:17 PM
Including Social Security presents some accounting problems. SS collects payroll taxes which, to my current knowledge, exceed the SS system payout. Hence this special "user fee" is in surplus and the excess goes to the general Treasury accounts.
Of course, treating SS as a "trust fund" is an accounting and political fiction. Hence, SS should be treated as a negative cost - for now.
Posted by: Whitehall | Apr 14, 2009 2:16:32 PM
I am not sure how 20% of tax dollars go into Social Security when SS is still running at a surplus? Unless you are adding SS into general revenue before applying the percentages, which is somewhat misleading? And if that is percentage of the tax dollars, shouldn't it add up to quite a bit more than 100%, since we have a considerable deficit, meaning spending outweights tax dollars?
Posted by: Tim McDonald | Apr 14, 2009 2:23:49 PM
What proportion of each category (including military) goes to direct and indirect employee and/or constituent compensation? Kind of like asking what proportion of charitable gifts go to the intended beneficiaries and what portion goes to pay United Way employees. Any statistics on what we're getting back for our tax dollars? Like, how much of transportation goes for "prevailing wage" work? How much of Social Security goes into the bank accounts of the retired and how much to workers in the SSA and its contractors?
Posted by: urthona | Apr 14, 2009 2:35:41 PM
In other words, about 66% of all federal spending (social security, medicare/medicaid/schip, safety net programs, and the entire "other" category aside from veterans' benefits), and probably significantly more, is some combination of waste and vote-buying.
Posted by: BC | Apr 14, 2009 2:45:02 PM
Bullshit. From 1993 to 2007 the top twenty breakdown as:
PROGRAM NAME 1993 to 2007 total PCT Of Total
Total Expenditures 1993 - 2007 $38,196,981,158,230.00
FLOOD INSURANCE $8,746,686,027,279.00 22.90%
SOCIAL SECURITY $5,749,248,231,972.00 15.05%
DEFENSE PROCUREMENT $2,574,509,838,963.00 6.74%
MEDICAL ASSISTANCE PROGRAM $1,985,740,311,648.00 5.20%
FEDERAL SALARIES $1,738,261,272,266.00 4.55%
MEDICARE-HOSPITAL INSURANCE $1,624,250,888,622.00 4.25%
FEDERAL PROCUREMENT $1,350,134,930,275.00 3.53%
MORTGAGE INSURANCE $1,338,407,021,154.00 3.50%
MEDICARE-SUPPLEMENTARY MEDICAL INSURANCE $1,213,919,610,684.00 3.18%
MILITARY SALARIES $1,185,104,030,309.00 3.10%
FEDERAL RETIREMENT AND DISABILITY PAYMENTS $1,179,166,836,053.00 3.09%
CROP DISASTER / INSURANCE $592,915,804,078.00 1.55%
VETERANS $551,677,067,827.00 1.44%
MEDICARE_HOSPITAL INSURANCE $510,956,381,352.00 1.34%
SUPPLEMENTAL SECURITY INCOME $461,235,411,644.00 1.21%
UNEMPLOYMENT INSURANCE $444,970,818,998.00 1.16%
HIGHWAY PROGRAMS $432,105,686,753.00 1.13%
EARNED INCOME CREDIT $396,613,109,000.00 1.04%
FEDERAL FAMILY EDUCATION LOANS $376,947,489,875.00 0.99%
TOTAL TOP 20 $32,452,850,768,752.00 84.96%
Posted by: wildman | Apr 14, 2009 2:52:13 PM
Wait, you mean it's not mostly earmarks for museums and Congressional perks?
Posted by: seamus | Apr 14, 2009 2:52:47 PM
Fooey to your explanation! Mine is quicker, and makes more sense:
Federal income tax "dollars" go into a black hole account to offset the massive influx of freshly-created "dollars" that are spent into the economy by Federal Reserve customers. When more bogus Fed "dollars" are "created" than taxed, we have either "economic growth", or "inflation", depending on the amount of non-productive greed the Federal Reserve allows.
Posted by: Joe Mama | Apr 14, 2009 3:09:19 PM
For clarification - 2009 is the first year (with many more to follow) that Social Security pays out more than it takes in. This was not "projected" to happen until 2019 but as with all government accounting the reality varies greatly from the projection.
Posted by: Greg Ferguson | Apr 14, 2009 3:41:55 PM
Meaningless gobble. For instance Veterans benefits are included in Program Areas in the Remaining Fifth of the Budget (Chart 1 above). Sure why not? Why not charge them to the Defense Department which incurred them in the first place?
Second, there is date on the chart. The text at the link seems to say it is from 2008. I assume, but do not know, that they mean Federal FY 2008 (10/1/2007 -- 9/30/2008). Therefor none of their figures includes the depredations enacted since 1/21/2009.
The objections on Social Security Accounting above are well taken.
The Country is in the Very Best of Hands (h/t Blog-father)
Posted by: Fat Man | Apr 14, 2009 3:42:23 PM
MAKE SOCIAL SECURITY VOLUNTARY.
Of course, it won't be, because we know how SS really works. But wouldn't it be closer to American ideals for such a program to be voluntary?
Posted by: wombly | Apr 14, 2009 4:00:09 PM
I mean, if SS is so great, why would they be afraid to make it voluntary?
Shouldn't that be a test that the government program needs to pass?
Posted by: wombly | Apr 14, 2009 4:01:07 PM
Does this include all revenue or just tax dollars? (I assume there is no distinction between tax dollars and money collected via tariffs, for example?)
In any case, the definitive illustration of where the money goes is here:
Posted by: l.a.guy | Apr 14, 2009 9:39:53 PM
This blog is an Amazon affiliate. Help support TaxProf Blog by making purchases through Amazon links on this site at no cost to you.