70% of U.S. Government Spending Is Writing Checks To Individuals

An anonymous reader writes with this excerpt from Investor's Business Daily:"Buried deep in a section of President Obama's budget, released this week, is an eye-opening fact: This year, 70% of all the money the federal government spends will be in the form of direct payments to individuals, an all-time high. In effect, the government has become primarily a massive money-transfer machine, taking $2.6 trillion from some and handing it back out to others. These government transfers now account for 15% of GDP, another all-time high. In 1991, direct payments accounted for less than half the budget and 10% of GDP. What's more, the cost of these direct payments is exploding. Even after adjusting for inflation, they've shot up 29% under Obama." It's very hard to lay blame on only one part of the U.S. government, though; as the two largest parties are often fond of pointing out when it suits them, all spending bills originate in the House.

Comments

VERY misleading terminology

[grahamwest]

"Individual" in this case does NOT mean "person".

If you download the spreadsheet you can see that they classify total spending as either "direct" or "grants", of which the vast bulk is "direct". Everything that is not a grant must be being paid to an entity of some kind, whether an actual person, a company, a non-profit or something. You can verify this is the total Federal spending using the Monthly Treasury Statements at https://www.fms.treas.gov/mts/... - I recommend the PDF versions.

As for the percentage going to veterans, I expect the number of veterans isn't growing very much, whereas the Federal budget is. So a constant amount in a larger total is going to be a smaller fraction.

Bottom line, this article is FUD and should not be taken serious by anyone.

Re:Makers and takers

[nbauman]

The rich pay most of the taxes and pay a higher percentage of income on taxes than everyone else.

I know that right-wing talking point and I've checked it out before. Don't forget the footnote:*
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*Footnote: "Taxes" are defined to exclude FICA, which is the largest payment most middle-class and working people pay.

Percentagewise, the rich pay roughly 30%, the same as the middle-class, although those that can put everything into investment income like Mitt Romney pay about 15%.

That's why Warren Buffet pays less than his secretary.