Tags

, ,

BUZZ THIS!

By Rady Ananda

Recently, Live Science published a chart showing the US spends about one-fifth of its budget on the military (aka ‘defense’).  But this view hides how Congress prioritizes spending, when you consider what is discretionary and voted upon each year. Perhaps a more salient view of these figures should segregate ‘discretionary’ spending from ‘mandatory’ spending. As we continue to suffer under rising unemployment, bankster bailouts, million dollar bonuses while the minimum wage remains below poverty, all amid a global financial crisis, how is today’s Congress prioritizing spending?

When it comes to discretionary spending, Congress gives 58% to the military.  Here are US budget charts for the years 2009 and 2010, according to the National Priorities Project (NPP):

 

NPP describes these charts this way:

“[These charts show] the breakdown of the proposed federal discretionary budget for fiscal year 2010 [or 2009] by function area.

“The discretionary budget refers to the part of the federal budget proposed by the President, and debated and decided by Congress each year. The part of the budget constitutes more than one-third of total federal spending. The remainder of the federal budget is called ‘mandatory spending.’ Fiscal Year 2009 will run from October 1, 2008 to September 30, 2009.

“Note that this chart includes the war-related spending requested by the administration as supplemental to the regular budget proposal.”

Note, too, the difference between ‘mandatory’ and ‘discretionary’ per NPP:

“Federal Discretionary and Mandatory Spending

“The Federal Budget can be divided into two types of spending according to how Congress appropriates the money: discretionary and mandatory. Discretionary spending refers to the portion of the budget which goes through the annual appropriations process each year.

Total Budget: $2.47 trillion
Mandatory: $1.5 trillion
Discretionary: $960 billion
Mid-Session Review, Budget of the U.S. Government, FY2006.

“In other words, Congress directly sets the level of spending on programs which are discretionary. Congress can choose to increase or decrease spending on any of those programs in a given year.

“The discretionary budget is about one-third of total federal spending. The chart below indicates how discretionary spending was divided up in fiscal year 2005.

“About half of the discretionary budget is ‘national defense,’ a government-defined function area that roughly corresponds in common parlance as ‘military.’ However, this category does not include foreign military financing, security assistance, and other programs commonly thought of as military. Other types of discretionary spending include the budget for education, many health programs, and housing assistance.

“Mandatory spending includes programs, mostly entitlement programs, which are funded by eligibility rules or payment rules. Congress decides to create a program, for example, Food Stamps. It then determines who is eligible for the program and any other criteria it may want to lay out. How much is appropriated for the program each year is then determined by estimations of how many people will be eligible and apply for Food Stamps.

“Unlike discretionary spending, the Congress does not decide each year to increase or decrease the Food Stamp budget; instead, it periodically reviews the eligibility rules and may change them in order to exclude or include more people.

“Mandatory spending makes up about two-thirds of the total federal budget. By far the largest mandatory program is Social Security which makes up one-third of mandatory spending and continues to grow as the age demographic of the country shifts towards an older population. The chart below shows the breakdown of different types of mandatory spending in fiscal year 2005.”

See more at National Priorities Project.

Also see discussion at How Are Our Federal Tax Dollars Spent? which shows that the military budget is one-fifth (21%), not over half, of our budget.

These differences exemplify how statisticians confound us with their expertise. Which is the more realistic view of military spending? Which captures how Congress prioritizes spending? Which is more relevant to us?

Arguably, discretionary spending is most relevant. And what does that 58% of discretionary spending amount to? In 2010: $1,027.8 billion, or over a trillion dollars, according to Robert Higgs of the Independent Institute, in Defense Spending Is Much Greater than You Think: more than $1Trillion a year.

About these ads