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Presentation by Molly Dahl and Kevin Perese, CBO Analysts, at the Urban Institute
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Congressional Budget Office
The Distribution of Federal Spending and Taxes in 2006
December 3, 2013
Molly Dahl, Microeconomic Studies Division
Kevin Perese, Tax Analysis Division
C O N G R E S S I O N A L B U D G E T O F F I C E
Overview
Extends prior CBO distributional analyses by including spending
Snapshot of a single year: calendar year 2006 Not a lifetime analysis
Household types Elderly
Nonelderly with children
Nonelderly without children
Income groups among the nonelderly Market income quintiles
C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Spending and Revenues, 2006
Federal Spending
$2.4 Trillion
$2.7 Trillion
Federal Revenues
C O N G R E S S I O N A L B U D G E T O F F I C E
Allocated Federal Spending and Revenues, 2006
Federal Spending
$2.4 Trillion
$2.3 Trillion
Federal Revenues
Analyzed the distribution of most federal spending (88 percent), and virtually all federal taxes (98 percent) in calendar year 2006
C O N G R E S S I O N A L B U D G E T O F F I C E
Categories of Federal Spending, 2006
Cash and Near-Cash Transfers
$785 Billion
Cash Transfers Social Security Refundable Tax Credits SSI UI TANF Means-Tested Veterans’ Benefits Black Lung Disability
Near-cash Transfers SNAP Housing Assistance Pell Grants Child Nutrition Programs WIC LIHEAP
Social Security
C O N G R E S S I O N A L B U D G E T O F F I C E
Categories of Federal Spending, 2006
Cash and Near-Cash Transfers
Health Care Transfers
$785 Billion
$481 Billion
Medicare Medicaid and CHIP Means-Tested Veterans’ Health Benefits
Social Security
Medicare
C O N G R E S S I O N A L B U D G E T O F F I C E
Categories of Federal Spending, 2006
Cash and Near-Cash Transfers
Health Care Transfers
Other Goods and
Services
$785 Billion
$481 Billion
$1,080 Billion
National Defense Other HHS Education OPM Transportation
Other Veterans Affairs Agriculture Justice Energy Other
National Defense
Social Security
Medicare
C O N G R E S S I O N A L B U D G E T O F F I C E
Categories of Federal Spending, 2006
Unallocated Spending
Cash and Near-Cash Transfers
Health Care Transfers
Other Goods and
Services
Social Security
National Defense
Medicare
Interest on Debt
$785 Billion
$481 Billion
$1,080 Billion
$312 Billion
Total Spending: $2.7 Trillion
Interest On Debt
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Cash and Near-Cash Transfers, by Type of Household, 2006
0
100
200
300
400
500
Other
(Billions of dollars)
Elderly
Social Security
Nonelderly Without Children
Nonelderly With Children
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Health Care Transfers, by Type of Household, 2006
0
100
200
300
400
500
(Billions of dollars)
Elderly
Medicare
Medicaid and Other
Nonelderly Without Children
Nonelderly With Children
C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Taxes, by Type of Household, 2006
0
400
800
1,200
(Billions of dollars)
Elderly Nonelderly Without Children
Nonelderly With Children
C O N G R E S S I O N A L B U D G E T O F F I C E
Average Transfers, Taxes, and Transfers Minus Taxes, by Type of Household, 2006
-20,000
-10,000
0
10,000
20,000
30,000
(Dollars per household)
Elderly Nonelderly without Children
Nonelderly with Children
Transfers minus Taxes
Taxes
Transfers
C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Spending, 2006
Unallocated Spending
Cash and Near-Cash Transfers
Health Care Transfers
Other Goods and
Services
$785 Billion
$481 Billion
$1,080 Billion
$312 Billion
Total Spending: $2.7 Trillion
C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Spending on Other Goods and Services, by Type of Household, 2006
0
200
400
600
(Billions of dollars)
Elderly Nonelderly without Children
Nonelderly with Children
Allocated by
Share of
Population
Allocated by
Share of
Market Income
C O N G R E S S I O N A L B U D G E T O F F I C E
Average Spending Minus Taxes, by Type of Household, 2006
-20,000
-10,000
0
10,000
20,000
30,000
(Dollars per household)
Elderly Nonelderly without Children
Nonelderly with Children
Transfers plus Other G&S (by Share of Population) minus Taxes
Transfers plus Other G&S (by Share of Market Income) minus Taxes
Transfers minus Taxes
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending and Revenues Allocated to Nonelderly Households
Federal Spending
$2.4 Trillion
$2.7 Trillion
Federal Revenues
$1.5 Trillion
$2 Trillion
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Nonelderly Households
$1.5 Trillion
Cash and Near-Cash
$175 Billion
Other Goods and Services
$375 Billion
Health Care
$920 Billion
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Cash and Near-Cash Transfers for Nonelderly Households
Cash and Near-Cash
Transfers
By Income Group
$375 Billion
Lowest Quintile
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Cash and Near-Cash Transfers for Nonelderly Households, by Income Group and Transfer
0
100
200
(Billions of dollars)
Lowest Quintile
Highest Quintile
Middle Quintile
Social Security
Other Cash
Transfers
Near-Cash
Transfers
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Health Care Transfers for Nonelderly Households
Health Care
Transfers
By Income Group
$175 Billion
Lowest Quintile
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Health Care Transfers for Nonelderly Households, by Income Group and Transfer
0
100
(Billions of dollars)
Lowest Quintile
Highest Quintile
Middle Quintile
Medicare
Medicaid and
Other
C O N G R E S S I O N A L B U D G E T O F F I C E
Spending on Transfers for Nonelderly Households, by Income Group
0
100
200
300
(Billions of dollars)
Lowest Quintile
Highest Quintile
Middle Quintile
C O N G R E S S I O N A L B U D G E T O F F I C E
Taxes Paid by Nonelderly Households
$2 Trillion
Highest Quintile
C O N G R E S S I O N A L B U D G E T O F F I C E
Average Market Income Plus Transfers Minus Taxes for Nonelderly Households
0
50,000
100,000
150,000
200,000
250,000
300,000
(Dollars per household)
Lowest Quintile
Highest Quintile
Middle Quintile
UP 101%
DOWN 14%
DOWN 27%
C O N G R E S S I O N A L B U D G E T O F F I C E
Federal Spending on Other Goods and Services for Nonelderly Households
Other Goods and
Services $920 Billion
Lowest Quintile
Allocated by Share of Population
Allocated by Share of
Market Income
C O N G R E S S I O N A L B U D G E T O F F I C E
Average Spending Minus Taxes for Nonelderly Households
-75,000
-50,000
-25,000
0
25,000
Transfers minus Taxes
(Dollars per household)
Lowest Quintile
Highest Quintile
Middle Quintile
Transfers plus Other G&S (by Share of Population) minus Taxes
Transfers plus Other G&S (by Share of Market Income) minus Taxes
C O N G R E S S I O N A L B U D G E T O F F I C E
Recap
Extends prior CBO distributional analyses by including spending
More spending on elderly households than taxes paid by those households in 2006; the opposite was true for nonelderly households
Among the nonelderly, more spending on lower income households than taxes paid by those households in 2006; the opposite was true for higher income households
