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The federal government is a big insurance company with an army.

In the 2010 federal spending budget, 20% is for defense and security, 6% is for interest on the federal debt, and 65% is for retirement, disability, medical, education, and other welfare programs. That leaves only 10% for everything else.  Hat tip to Mark Thoma who posted here the following pie chart from CBO.

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Reader Comments (3)

Roger, this chart bothers me. That's the lowest defense figure I've ever seen anywhere. Does it really include all of the payments to private contractors etc. and the Iraq, Afghanistan war figures? Also, how much of that debt interest payment is what is owed to the Social security fund? And, unless we see where the money is coming from and how much of it offsets the outgo, it is hard to understand the meaning of this chart. In other words, as I understand it, social security is still self supporting. So, if it is 20% input and 20% output it is a wash...it can't be spending. If we all stopped paying into Social Security and stopped taking out smaller..so to speak... How much of Medicare is self supporting?
And, all of these payments support businesses and go directly back into the financial life of the nation. I'm troubled, as George Lakoff would say, by your framing. Welfare programs are the only reason for a government to exist. A highway construction project is a welfare project. What is there that is not a welfare project??? This sounds like a Tea Party ad.

April 18, 2010 | Unregistered CommenterChristine

Furthermore, as we know quite well, insurance companies are very lucrative, long-lived businesses that invest in almost everything in the economy.

April 18, 2010 | Unregistered CommenterChristine


I haven't gone behind the CBO chart to check its numbers and definitions. Assuming these are the facts, I don't think they either support or refute Tea Party activists or Grover Norquist. To me they just seem a part of a neutral appraisal of the status quo--our point of departure whichever direction we decide to go. As usual, I'm more focused on accurate problem description than with promoting particular solutions.

What a "welfare program" is is of course in the eye of the beholder. I included "benefits for federal employees and retirees," even though CBO did not, because it seems to me they are all entitlements claimed by individuals. I assume expenses for EPA, IRS, DOJ, the court system, scientific research, FAA, and road building among other programs are generally not considered to be "welfare" programs. Nor are agricultural subsidies and other benefits to corporations generally considered "welfare" although in the broadest sense every government expenditure should be welfare enhancing.

For those who would want to preserve these entitlement programs, there probably is a more politically acceptable way to frame them than as "welfare." What is that better way?

April 19, 2010 | Unregistered CommenterSkeptic

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