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50 Years Of Government Spending (And Last Week’s Budget Deal), In 3 Graphs

Filed by KOSU News in Business.
December 17, 2013

Over the past 50 years, both the way the federal government spends money and what the government spends money on has changed a lot.

It used to be that most spending was what wonks call “discretionary spending.” This is money that has to be approved every year by Congress.

Today, most government spending is what wonks call “mandatory spending.” This is money that is spent according to formulas that exist in the law. To change mandatory spending, Congress has to change the law.

Fifty years ago, defense spending accounted for about half of all government spending. Today, defense spending accounts for less than a quarter of all government spending. (In the graph, by the way, “Non-defense” refers to non-defense discretionary spending, which includes education, transportation and lots of other government programs.)

Medicare didn’t exist 50 years ago; last year, it accounted for more than 10 percent of federal spending.

The budget deal the House passed last week focuses on discretionary spending, not mandatory spending. In particular, it undoes some of the spending cuts that Congress passed last year as part of the sequester. Those cuts included both defense and non-defense discretionary spending.

In other words, both defense spending and non-defense spending will be higher than they would have been had the cuts remained in place. Next year, for example, defense spending will be 4.5 percent higher than it would have been with the cuts; non-defense discretionary spending will be 4.7 percent higher than it would have been.

The Senate is expected to vote on the bill soon. [Copyright 2013 NPR]

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