Following your tax dollars
If you haven’t yet filed your income tax forms, you’d better move fast. They must be postmarked today, or if filed electronically, by midnight. The feds need your share of 2017’s estimated $2.2 trillion (individual and corporate) income tax revenue, according to the Tax Foundation. That’s a tad more than the prior year’s total income tax revenue of $2.1 trillion. Total revenue — including excise and other taxes — for 2016 was about $3.5 trillion.
As usual, we spent more, financed it by borrowing, and plan to continue.
According to the nonpartisan Tax Policy Center, in fiscal year 2016 federal spending was $3.9 trillion. The budget deficit continues to increase each year, and is expected to surpass $1 trillion by 2020. (That’s different from the national debt, which means the public’s combined debt of $21 trillion.)
If you wonder where your taxes go, the biggest categories of federal spending are:
Social Security: That’s about 24 percent of the budget, providing monthly retirement benefits averaging $1,360 to 41 million retired workers as of December 2016. Social Security also provides benefits to 3 million spouses and children of retired workers, 6 million surviving children and spouses of deceased workers, and 10.6 million disabled workers and their eligible dependents.
Medicare, Medicaid, CHIP, health subsidies: Four health insurance programs — Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), and Affordable Care Act (ACA) marketplace subsidies — together account for about one-quarter of the budget, or about $1 trillion. Three-fifths of this, nearly $600 billion, went to Medicare. The ACA portion in 2016 was about $31 billion, or about 3 percent of this category.
Defense and security: About 16 percent of the budget pays for defense and security-related international activities; the bulk of it pays costs of Department of Defense.
“Safety net” programs: About 9 percent of the federal budget supports aid programs to low-income, elderly, or disabled individuals and families, including the Earned Income and Child Tax Credits, Supplemental Security Income, unemployment insurance, SNAP/food stamps, school meals, low-income housing and child care assistance, aid for abused and neglected children, and other programs. Census information indicates that such safety net programs kept some 36 million people out of poverty in calendar year 2016.
Interest on debt: The federal government’s interest payments on financed deficits, which reached $14 trillion by the end of fiscal 2016, take about 6 percent of the budget.
The rest goes to a variety of other public services, such as veterans’ health care, federal employee retirement payments, food and drug safety, parks, forests and fire, education, science, and basic infrastructure such as roads, bridges, and airports. Less than 1 percent of the budget goes to non-security international programs, such as humanitarian aid.
For more information see CBPP.org and TaxFoundation.org.
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Sholeh Patrick is a columnist for the Hagadone News Network. Contact her at Sholeh@cdapress.com.