US Government Expenditures by Segment

A letter to our readers

A letter to the country’s shareholders while the nation is at a crossroads Corporate income tax collections fell 31% from 2017 to 2018, but federal tax revenue held. The number of Americans receiving government food assistance grew by 12% in 2020. There are more subsidized housing units, but people are waiting longer for them. More Americans are living alone and unmarried. The child poverty rate is falling, but that’s not the whole story. The senior population is growing faster than the general population. The US is increasingly a nation of immigrants. Small roads and key train infrastructure are in poor condition. Data for the road ahead

Share the 10-k

Newsletter

Data delivered to your inbox

Keep up with the latest data and most popular content.

Expenditures by segment⁴⁵

		2018							2017							Changes


(In billions, except percentages)		Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total	Federal ¹	State and Local


Justice and Domestic Tranquility		$	473	$	67		$	406	$	447	$	55		$	392	$	26	$	12		$	14	6%	22%		4%
Common Defense			874		873			1		835		834			1		39		39			—	5%	5%		—%
General Welfare			1,447		429			1,018		1,410		440			970		37		(11)			48	3%	(3)%		5%
Blessings of Liberty			3,355		2,052			1,303		3,238		1,979			1,259		117		73			44	4%	4%		3%
General government support and other			143		(20)			163		139		(10)			149		4		(10)			14	3%	(100)%		9%


Total expenditures		$	6,292	$	3,401		$	2,891	$	6,069	$	3,298		$	2,771	$	223	$	103		$	120	4%	3%		4%
	Estimated impact of inflation on total expenditures															$	145	$	79		$	66	2%	2%		2%
	Estimated impact of population growth on total expenditures																32		17			15	1%	1%		1%

		2018							2013							Changes


(In billions, except percentages)		Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total	Federal ¹	State and Local


Justice and Domestic Tranquility		$	473	$	67		$	406	$	400	$	55		$	345	$	73	$	12		$	61	18%	22%		18%
Common Defense			874		873			1		833		832			1		41		41			—	5%	5%		—%
General Welfare			1,447		429			1,018		1,232		451			781		215		(22)			237	17%	(5)%		30%
Blessings of Liberty			3,355		2,052			1,303		2,678		1,576			1,102		677		476			201	25%	30%		18%
General government support and other			143		(20)			163		137		(10)			147		6		(10)			16	4%	100%		11%


Total expenditures		$	6,292	$	3,401		$	2,891	$	5,280	$	2,904		$	2,376	$	1,012	$	497		$	515	19%	17%		22%
	Estimated impact of inflation on total expenditures															$	398	$	219		$	179	8%	8%		8%
	Estimated impact of population growth on total expenditures																180		99			81	3%	3%		3%

		2018							2008							Changes


(In billions, except percentages)		Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total		Federal ¹		State and Local			Total	Federal ¹	State and Local


Justice and Domestic Tranquility		$	473	$	67		$	406	$	366	$	40		$	326	$	107	$	27		$	80	29%	68%		25%
Common Defense			874		873			1		741		740			1		133		133			—	18%	18%		—%
General Welfare			1,447		429			1,018		1,021		368			653		426		61			365	42%	17%		56%
Blessings of Liberty			3,355		2,052			1,303		2,358		1,390			968		997		662			335	42%	48%		35%
General government support and other			143		(20)			163		164		12			152		(21)		(32)			11	(13)%	(267)%		7%


Total expenditures		$	6,292	$	3,401		$	2,891	$	4,650	$	2,550		$	2,100	$	1,642	$	851		$	791	35%	33%		38%
	Estimated impact of inflation on total expenditures															$	766	$	420		$	346	16%	16%		16%
	Estimated impact of population growth on total expenditures																348		191			157	7%	7%		7%

Sources & Footnotes

¹ Federal expenditures exclude transfers to state and local governments. See separate schedule and discussion of intergovernmental transfers at Note 23 – Intergovernmental transfers (Part II, Item 8 within this Annual Report).

Justice and Domestic Tranquility (JDT)

This segment’s expenditures comprise a small portion (8%) of the overall Government budget. The majority (more than 60%) of this segment’s expenditures comprises state and local government crime and disaster expenditures, of which more than 65% are law enforcement and corrections expenditures. See Exhibit 99.05 for more information on the largest items in each of this segment’s expenditure categories.

Fiscal year 2018 compared with fiscal year 2017

			2018						2017						Changes ²


(In billions, except percentages)			Total		Federal ¹	State and Local			Total		Federal ¹	State and Local			Total		Federal ¹	State and Local		Total	Federal ¹	State and Local


Crime and disaster		$	361	$	60	$	301	$	338	$	46	$	292	$	23	$	14	$	9	7%	30%		3%
Child safety and miscellaneous social services			91		1		90		87		1		86		4		—		4	5%	—%		5%
Safeguarding consumers and employees			21		6		15		22		8		14		(1)		(2)		1	(5)%	(25)%		7%


Total Justice and Domestic Tranquility		$	473	$	67	$	406	$	447	$	55	$	392	$	26	$	12	$	14	6%	22%		4%
As a percentage of total expenditures			8%		2%		14%		7%		2%		14%
	Estimated impact of inflation on segment expenditures													$	10	$	1	$	9	2%	2%		2%
	Estimated impact of population growth on segment expenditures														2		—		2	1%	1%		1%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal crime and disaster

The $14 billion increase in federal crime and disaster expenditures was driven primarily by a $13 billion or 177% increase in disaster relief expenditures. The number of billion-dollar weather and climate disaster incidents decreased by 2 or 13% during this period.⁴⁸ Hurricanes Harvey, Maria, and Irma all occurred in late fiscal year 2017, and the costs associated with addressing these disasters were part of the fiscal year 2018 results.

State and local crime and disaster

The $9 billion increase in state and local crime and disaster expenditures was driven primarily by a $7 billion or 4% increase in law enforcement and corrections costs, reflecting a $5 billion or 4% increase in law enforcement expenditures and a $2 billion or 3% increase in corrections expenditures.

The $5 billion increase in law enforcement expenditures was driven mainly by a $4 billion or 4% increase in police protection operations costs. Annualized gross payroll costs (including wages and healthcare costs, excluding pension benefits) for state and local police protection employees grew $2 billion or 3% during this period, while the number of state and local police protection employees increased 1%. During this period, the violent crime rate decreased 4% and related arrests increased 1%, while the property crime rate decreased 7% and related arrests decreased 7%.

The $2 billion increase in corrections expenditures comprised mainly a $2 billion or 3% increase in correctional operations costs. Annualized gross payroll costs for state and local corrections employees grew $1 billion or 3% during this period, while the number of correctional employees decreased 1%. Comparing these years, there was a 2% and 1% decrease in the number of people incarcerated in state prisons and local jails, respectively.

Fiscal year 2018 compared with fiscal year 2013

		2018						2013						Changes ²


(In billions, except percentages)			Total		Federal ¹	State and Local			Total		Federal ¹	State and Local			Total		Federal¹	State and Local		Total	Federal¹	State and Local


Crime and disaster		$	361	$	60	$	301	$	306	$	50	$	256	$	55	$	10	$	45	18%	20%		18%
Child safety and miscellaneous social
services			91		1		90		75		1		74		16		—		16	21%	—%		22%
Safeguarding consumers and employees			21		6		15		19		4		15		2		2		—	11%	50%		—%


Total Justice and Domestic Tranquility		$	473	$	67	$	406	$	400	$	55	$	345	$	73	$	12	$	61	18%	22%		18%
As a percentage of total expenditures			8%		2%		14%		8%		2%		15%
	Estimated impact of inflation on segment expenditures													$	30	$	4	$	26	8%	8%		8%
	Estimated impact of population growth on segment expenditures														14		2		12	3%	3%		3%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

State and local crime and disaster

The $45 billion increase in state and local crime and disaster expenditures was driven primarily by a $29 billion or 17% increase in law enforcement and corrections costs, reflecting a $20 billion or 20% increase in law enforcement expenditures and a $9 billion or 12% increase in corrections expenditures. In addition, fire protection costs increased $10 billion or 22%.

The $20 billion increase in law enforcement expenditures was driven mainly by a $20 billion or 21% increase in police protection operations costs. Annualized gross payroll costs for state and local police protection employees grew $10 billion or 17% during this period, while the number of state and local police protection employees increased 4%. During this period, the violent crime rate remained flat and related arrests increased 6%, while the property crime rate decreased 19% and related arrests decreased 25%.

The $9 billion increase in corrections expenditures comprised mainly an $8 billion or 14% increase in correctional operations costs. Annualized gross payroll costs for state and local corrections employees grew $6 billion or 16% during this period, while the number of correctional employees remained flat. Comparing these years, there was a 7% decrease in the number of people incarcerated in state prisons, while the number of people incarcerated in local jails increased 1%.

The $10 billion increase in fire protection costs reflects an increase of $4 billion or 18% in annualized gross payroll costs for state and local fire protection employees, while the number of state and local fire protection employees increased 3%. Overall non-natural disaster fire incidents increased 1% during this period.

State and local child safety and miscellaneous social services

The $16 billion increase in state and local child safety and miscellaneous social services expenditures was due to a $15 billion or 20% increase in the costs of public welfare operations.

Fiscal year 2018 compared with fiscal year 2008

			2018						2008						Changes ²


(In billions, except percentages)			Total		Federal ¹	State and Local			Total		Federal ¹	State and Local			Total		Federal ¹	State and Local		Total	Federal ¹	State and Local


Crime and disaster		$	361	$	60	$	301	$	278	$	35	$	243	$	83	$	25	$	58	30%	71%		24%
Child safety and miscellaneous social services			91		1		90		69		—		69		22		1		21	32%	nm		30%
Safeguarding consumers and employees			21		6		15		19		5		14		2		1		1	11%	20%		7%


Total Justice and Domestic Tranquility		$	473	$	67	$	406	$	366	$	40	$	326	$	107	$	27	$	80	29%	68%		25%
As a percentage of total expenditures			8%		2%		14%		8%		2%		16%
Estimated impact of inflation on segment expenditures														$	61	$	7	$	54	16%	16%		16%
	Estimated impact of population growth on segment expenditures														27		3		24	7%	7%		7%

Sources & Footnotes

^nm An “nm” reference in the table means the figures is not meaningful.

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal crime and disaster

The $25 billion increase in federal crime and disaster expenditures was driven primarily by a $9 billion or 516% increase in disaster relief expenditures and a $7 billion or a non-meaningful % change increase in national flood insurance reserve expenditures. The number of billion-dollar weather and climate disaster incidents increased by 2 or 17% during this period.⁴⁸

State and local crime and disaster

The $58 billion increase in state and local crime and disaster expenditures was driven primarily by a $38 billion or 23% increase in costs of law enforcement and corrections, reflecting a $29 billion or 33% increase in law enforcement expenditures and a $9 billion or 12% increase in corrections expenditures. In addition, fire protection costs increased $13 billion or 32%.

The $29 billion increase in law enforcement expenditures was driven by a $29 billion or 34% increase in police protection operations costs. Annualized gross payroll costs for state and local police protection employees grew $13 billion or 24% during this period, while the number of state and local police protection employees decreased 2%. During this period, property and violent crime rates decreased 31% and 19%, respectively, while arrests for property and violent crimes decreased 29% and 13%, respectively.

The $9 billion increase in corrections expenditures was driven by a $12 billion or 20% increase in correctional operations costs. Annualized gross payroll costs for state and local corrections employees grew $6 billion or 17% during this period, while the number of correctional employees decreased 6%. Comparing these years, there was a 6% and 8% decrease in the number of people incarcerated in local jails and state prisons, respectively.

The $13 billion increase in fire protection costs reflects an increase of $6 billion or 27% in annualized gross payroll costs for state and local fire protection employees, while the number of state and local fire protection employees decreased 2%. Overall non-natural disaster fire incidents decreased 12% during this period.

Common Defense

This segment’s expenditures comprise 14% of the overall Government budget. Slightly more than 70% of this segment’s expenditures are costs of national defense, while most of the rest (slightly more than 20%) comprise costs of support for veterans. See Exhibit 99.05 for more information on the largest items in each of this segment’s expenditure categories.

Fiscal year 2018 compared with fiscal year 2017

	2018						2017						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


National defense	$	631	$	631	$	—	$	599	$	599	$	—	$	32	$	32	$	—		5%		5%		—%
Support for veterans		178		177		1		175		174		1		3		3		—		2%		2%		—%
Foreign affairs and foreign aid		49		49		—		46		46		—		3		3		—		7%		7%		—%
Immigration and border security		16		16		—		15		15		—		1		1		—		7%		7%		—%


Total Common Defense	$	874	$	873	$	1	$	835	$	834	$	1	$	39	$	39	$	—		5%		5%		—%
As a percentage of total expenditures		14%		26%		—%		14%		25%		—%
Estimated impact of inflation on segment expenditures													$	20	$	20	$	—		2%		2%		2%
Estimated impact of population growth on segment expenditures														4		4		—		1%		1%		1%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

National defense

The $32 billion increase in national defense expenditures reflects:

a $10 billion or 5% increase in operations and maintenance expenditures, mostly for the Army, which fund the training, supply, and equipment maintenance of military units as well as the infrastructure of military bases;
a $9 billion or 13% increase in research and development expenditures, mostly for the Air Force; and
a $9 billion or 8% increase in military procurement expenditures, mostly for the Army and Navy and primarily for the procurement of items other than aircraft, missiles, ammunition, weapons, or tracked combat vehicles, and for space related items.

Comparing these years, the number of active duty military personnel and civilian military personnel increased 1% and 2%, respectively.

Fiscal year 2018 compared with fiscal year 2013

2018

2013

Changes ²

(In billions, except percentages)

Total

Federal ¹

State and

Local

Total

Federal ¹

State and

Local

Total

Federal ¹

State and

Local

Total

Federal ¹

State and

Local



National defense	$	631	$	631	$	—	$	633	$	633	$	—	$	(2)	$	(2)	$	—		—%	—%	—%
Support for veterans		178		177		1		139		138		1		39		39		—		28%	28%	—%
Foreign affairs and foreign aid		49		49		—		47		47		—		2		2		—	4%		4%	—%
Immigration and border security		16		16		—		14		14		—		2		2		—	14%		14%	—%


Total Common Defense	$	874	$	873	$	1	$	833	$	832	$	1	$	41	$	41	$	—		5%	5%	—%
As a percentage of total expenditures		14%		26%	—%			16%		29%	—%
Estimated impact of inflation on segment expenditures													$	63	$	63	$	—		8%	8%	8%
Estimated impact of population growth on segment expenditures														28		28		—		3%	3%	3%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal support for veterans

The $39 billion increase in federal support for veterans’ expenditures was driven primarily by a $20 billion or 40% increase in veterans medical care costs and a $20 billion or 30% increase in pension and disability benefits expenditures, despite a 10% decline in the number of veterans.

The 40% increase in veterans medical care costs was driven primarily by a $9 billion or 100% increase in veterans Medical Community Care expenditures and a $7 billion or 17% increase in veterans medical services costs. Veterans medical community care expenditures are for hospital care and medical services from community providers that are not provided through the Veterans Choice Program, and veterans medical services costs are for inpatient and outpatient care, including treatment in facilities not under the jurisdiction of the Department of Veterans Affairs, as well as salaries and medical supplies for nursing home and hospital care. There was a 7% increase in the number of patients who received care at a Veterans Health Administration facility during this period, while medical care inflation was 14%.

The 30% increase in pension and disability benefits expenditures was driven primarily by growth of $21 billion or 35% in veteran compensation payments. This growth primarily reflects a 1 million or 27% increase in the number of disability compensation recipients, and a $3,042 or 23% increase in the average annual disability compensation payment. There was also a 46 thousand or 12% increase in the number of surviving beneficiary compensation recipients, and an $895 or 6% increase in the average annual surviving beneficiary compensation payment. The overall growth in compensation payments reflects changes in underlying veteran demographics; there was a 65% increase in veteran/beneficiary claimants who served in the Gulf War Era, partially offset by a 55% decrease in veteran/beneficiary claimants who served in World War II.

Fiscal year 2018 compared with fiscal year 2008

	2018						2008						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


National defense	$	631	$	631	$	—	$	616	$	616	$	—	$	15	$	15	$	—		2%		2%		—%
Support for veterans		178		177		1		85		84		1		93		93		—		109%		111%		—%
Foreign affairs and foreign aid		49		49		—		29		29		—		20		20		—	69%			69%		—%
Immigration and border security		16		16		—		11		11		—		5		5		—	45%			45%		—%


Total Common Defense	$	874	$	873	$	1	$	741	$	740	$	1	$	133	$	133	$	—		18%		18%		—%
As a percentage of total expenditures		14%		26%	—%			16%		29%	—%
Estimated impact of inflation on segment expenditures													$	122	$	122	$	—		16%		16%		16%
Estimated impact of population growth on segment expenditures														55		55		—		7%		7%		7%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal support for veterans

The $93 billion increase in federal support for veterans expenditures was driven primarily by a $44 billion or 107% increase in pension and disability benefits expenditures and a $36 billion or 98% increase in veterans medical care costs, despite a 20% decline in the number of veterans.

The 107% increase in pension and disability benefits expenditures primarily reflects a 1.8 million or 61% increase in the number of disability compensation recipients, and a $5,919 or 58% increase in the average annual disability compensation payment. There was also an 85 thousand or 25% increase in the number of surviving beneficiary compensation recipients, and a $2,460 or 18% increase in the average annual surviving beneficiary compensation payment. The overall increase in compensation payments reflects changes in underlying veteran demographics; there was a 243% increase in veteran/beneficiary claimants who served in the Gulf War Era, partially offset by a 76% decrease in veteran/beneficiary claimants who served in World War II.

The 98% increase in veterans medical care costs was driven primarily by a $19 billion or 63% increase in medical services expenditures and a $9 billion or 100% increase in veterans medical community care expenditures. There was a 15% increase in the number of patients who received care at a Veterans Health Administration facility between 2008 and 2018, while medical care inflation was 33%.

Foreign affairs and foreign aid

The $20 billion increase in federal foreign affairs and foreign aid expenditures was driven primarily by a $15 billion or 85% increase in foreign military sales trust fund expenditures and an $8 billion or 782% increase in global health programs expenditures.

The foreign military sales trust fund facilitates contracts, agreements and sales of defense articles, defense services, and design and construction services between the US federal government and authorized foreign recipient governments or international organizations. The 85% increase in foreign military sales trust fund expenditures is due, in part, to a 95% increase in foreign military sales, with the largest foreign sales in 2018 being made to Saudi Arabia, Kuwait, Poland, United Arab Emirates, and Iraq, comprising 26%, 13%, 9%, 6%, and 4%, respectively, of the total 2018 sales.

The 782% increase in global health programs expenditures relates to increased federal obligations for programs for funding, equipment, and technical assistance to build the capacity of public health institutions and organizations in developing countries, and for, but not limited to programs for: child survival and maternal health; immunization and oral rehydration; prevention, treatment, control of, and research on, HIV/AIDS and other infectious diseases; assistance to communities severely affected by HIV/AIDS; and disaster preparedness training for health crises.

General Welfare (GW)

This segment’s expenditures comprise approximately a quarter of the overall Government budget. Expenditures for standard of living and aid to the disadvantaged comprise just over 70% of this segment’s expenditures. Over 68% of the expenditures for standard of living and aid to the disadvantaged are for state and local medical assistance to the poor, including Medicaid and CHIP. See Exhibit 99.05 for more information on the largest items in each of this segment’s expenditure categories.

Fiscal year 2018 compared with fiscal year 2017

	2018						2017						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Economy and infrastructure	$	264	$	58	$	206	$	259	$	62	$	197	$	5	$	(4)	$	9		2%		(6)%		5%
Standard of living and aid to the
disadvantaged		1,019		320		699		992		329		663		27		(9)		36		3%		(3)%		5%
Health (excluding Medicaid and
Medicare)		164		51		113		159		49		110		5		2		3	3%			4%		3%


Total General Welfare	$	1,447	$	429	$	1,018	$	1,410	$	440	$	970	$	37	$	(11)	$	48		3%		(3)%		5%
As a percentage of total expenditures		23%		13%	35%			23%		13%	35%
Estimated impact of inflation on segment expenditures													$	34	$	11	$	23		2%		2%		2%
Estimated impact of population growth on segment expenditures														7		2		5		1%		1%		1%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

State and local standard of living and aid to the disadvantaged expenditures

The $36 billion increase in state and local standard of living and aid to the disadvantaged expenditures was driven by a $35 billion or 6% increase in Medicaid and CHIP benefits payments, as discussed within Expenditures by function, 2017 to 2018 / State and local transfer payments to individuals and subsidies above.

Fiscal year 2018 compared with fiscal year 2013

	2018						2013						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Economy and infrastructure	$	264	$	58	$	206	$	237	$	62	$	175	$	27	$	(4)	$	31		11%		(6)%		18%
Standard of living and aid to the
disadvantaged		1,019		320		699		850		339		511		169		(19)		188		20%		(6)%		37%
Health (excluding Medicaid and Medicare)		164		51		113		145		50		95		19		1		18	13%			2%		19%


Total General Welfare	$	1,447	$	429	$	1,018	$	1,232	$	451	$	781	$	215	$	(22)	$	237		17%		(5)%		30%
As a percentage of total expenditures		23%		13%	35%			23%		16%	33%
Estimated impact of inflation on segment expenditures													$	93	$	34	$	59		8%		8%		8%
Estimated impact of population growth on segment expenditures														42		15		27		3%		3%		3%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

State and local standard of living and aid to the disadvantaged expenditures

The $188 billion increase in state and local standard of living and aid to the disadvantaged expenditures was driven by a $186 billion or 44% increase in Medicaid and CHIP payments, as discussed within Expenditures by function, 2013 to 2018 / State and local transfer payments to individuals and subsidies above.

Fiscal year 2018 compared with fiscal year 2008

	2018						2008						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Economy and infrastructure	$	264	$	58	$	206	$	250	$	88	$	162	$	14	$	(30)	$	44		6%		(34)%		27%
Standard of living and aid to the
disadvantaged		1,019		320		699		638		242		396		381		78		303		60%		32%		77%
Health (excluding Medicaid and Medicare)		164		51		113		133		38		95		31		13		18	23%			34%		19%


Total General Welfare	$	1,447	$	429	$	1,018	$	1,021	$	368	$	653	$	426	$	61	$	365		42%		17%		56%
As a percentage of total expenditures		23%		13%	35%			22%		14%	31%
Estimated impact of inflation on segment expenditures													$	169	$	61	$	108		16%		16%		16%
Estimated impact of population growth on segment expenditures														77		28		49		7%		7%		7%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal standard of living and aid to the disadvantaged expenditures

The $78 billion increase in federal standard of living and aid to the disadvantaged expenditures was driven by many items. The items that each increased $10 billion or more were:

$41 billion of newly available refundable tax credits paid to families and individuals to assist them in purchasing health insurance (the Premium Tax Credit);
a $27 billion or 76% increase in food and nutritional assistance (SNAP) payments;
an $18 billion or 44% increase in refundable Earned Income Tax Credits, reflecting an 8%* increase in the number of tax returns with qualifying tax credits claimed and a $424* or 21%* increase in the average amount of each tax credit, driven primarily by the ARRA³⁷;
a $13 billion or 76% increase in Pell grants, reflecting a 28% increase in the number of Pell grant recipients and a 52% or $1,352 increase in the average grant per recipient, driven primarily by the ARRA; and
an $11 billion or 26% increase in Supplemental Security Income payments, reflecting a 10%* increase in the number of recipients and a $1,126* or 24%* increase in the average annual payment per recipient, partially offset by
a $14 billion or 100% decrease in refundable recovery rebate tax credits, payments to taxpayers of up to $600 per qualifying adult and $300 per qualifying child, which were provided as part of the 2008 Economic Stimulus Act of 2008³⁷, and
a $15 billion or 45% decrease in refundable child tax credits, reflecting a temporary provision enacted in the Economic Stimulus Act of 2008 that provided anyone eligible for a stimulus payment an additional $300 for each qualifying child, which increased expenditures in 2008³⁷.

The 76% increase in SNAP payments reflects a 44% increase in the average monthly number of participants and a 22% increase in the average monthly benefit per person. The 48% increase in average number of monthly participants was likely due to the Great Recession, as well as due to the impact of the ARRA, which eased eligibility requirements, and new program tools that made it easier for people to apply for, and continue receiving, benefits. The 22% increase in the average monthly benefit per person reflects an 18% increase in maximum allotments, which are adjusted annually for changes in cost of living, and which during this period reflected the impact of the ARRA, which increased the maximum allotments for participants by 14% (effective April 1, 2009 to October 31, 2013). Inflation of the cost of food for this period was 20%.

State and local standard of living and aid to the disadvantaged expenditures

The $303 billion increase in state and local standard of living and aid to the disadvantaged expenditures was driven by a $294 billion or 95% increase in Medicaid and CHIP payments, as discussed within Expenditures by function, 2008 to 2018 / State and local transfer payments to individuals and subsidies above.

Blessings of Liberty (BL)

This segment’s expenditures comprise approximately half of our Government’s expenditures. Wealth and savings (primarily Social Security, government obligations, including pension obligations and interest on debt, and Medicare) expenditures comprise nearly 70% of the segment’s expenditures, with education expenditures comprising most of the remainder. See Exhibit 99.05 for more information on the largest items in each of this segment’s expenditure categories.

Fiscal year 2018 compared with fiscal year 2017

	2018						2017						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Education	$	921	$	—	$	921	$	939	$	48	$	891	$	(18)	$	(48)	$	30		(2)%		(100)%			3%
Wealth and savings		2,324		1,997		327		2,192		1,878		314		132		119		13		6%		6%			4%
Sustainability and self-sufficiency		110		55		55		107		53		54		3		2		1	3%			4%		2%


Total Blessings of Liberty	$	3,355	$	2,052	$	1,303	$	3,238	$	1,979	$	1,259	$	117	$	73	$	44		4%		4%			3%
As a percentage of total expenditures		53%		60%	45%			53%		60%	45%
Estimated impact of inflation on segment expenditures													$	77	$	47	$	30		2%		2%			2%
Estimated impact of population growth on segment expenditures														17		10		7		1%		1%			1%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Federal wealth and savings expenditures

The $119 billion increase in federal wealth and savings expenditures was driven primarily by a $61 billion or 17% increase in government obligations, including interest on debt costs, and a $43 billion or 5% increase in Social Security expenditures.

The 17% increase in government obligations was driven by increased net interest on debt, due to higher federal marketable Treasury securities outstanding and increased interest rates, as discussed within Expenditures by function, 2017 to 2018 / Federal net interest paid above.

The 5% increase in Social Security expenditures reflects increased benefits payments, as discussed within Expenditures by function, 2017 to 2018 / Federal transfer payments to individuals and subsidies, Social Security above.

Fiscal year 2018 compared with fiscal year 2013

	2018						2013						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Education	$	921	$	—	$	921	$	743	$	(30)	$	773	$	178	$	30	$	148		24%		100%		19%
Wealth and savings		2,324		1,997		327		1,813		1,536		277		511		461		50		28%		30%		18%
Sustainability and self-sufficiency		110		55		55		122		70		52		(12)		(15)		3	(10)%			(21)%		6%


Total Blessings of Liberty	$	3,355	$	2,052	$	1,303	$	2,678	$	1,576	$	1,102	$	677	$	476	$	201		25%		30%		18%
As a percentage of total expenditures		53%		60%	45%			51%		54%	46%
Estimated impact of inflation on segment expenditures													$	202	$	119	$	83		8%		8%		8%
Estimated impact of population growth on segment expenditures														92		54		38		3%		3%		3%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

State and local education expenditures

The $148 billion increase in state and local education expenditures was driven primarily by a $126 billion or 21% increase in costs of elementary and secondary education and a $22 billion or 14% increase in costs of higher education.

The 21% increase in costs of elementary and secondary education during this period primarily reflects:

a 14% increase in salaries and wages, including 13% for instruction employees and 17% for support employees; and
a 30% increase in employee benefits, including 30% for instruction employees and 29% for support employees.

Within public elementary and secondary schools, the numbers of students enrolled and teachers both increased 2% and the student/teacher ratio remained flat at 16.0 students per teacher.

The 14% increase in costs of higher education expenses during this period primarily reflects:

a 15% increase in costs of instruction, including a 17% increase in salaries and wages;
a 25% increase in costs of academic support, including libraries, academic administration, course curriculum development, and ancillary support; and
a 16% increase in costs of institutional support, the day-to-day operational costs for institutions (excluding physical plant operations), including general administrative services, executive direction and planning, legal and fiscal operations, and community relations; partially offset by
a 44% decrease in costs of auxiliary enterprises, essentially self-supporting operations of institutions that furnish a service to students, faculty, or staff, such as residence halls and food services.

Within higher education institutions, the number of faculty staff was flat and administrative staff decreased 8%, while the number of students enrolled decreased 1%. The student/faculty ratio declined 2% from 15.2 to 14.9, while the student/administrative staff ratio increased 7% from 48.6 to 52.2.

Federal wealth and savings expenditures

The $461 billion increase in federal costs of wealth and savings was driven primarily by a $174 billion or 21% increase in Social Security expenditures, a $117 billion or 38% increase in government obligations, and a $91 billion or 18% increase in Medicare expenditures. The increases in Social Security and Medicare expenditures reflect increased benefits payments, as discussed within Expenditures by function, 2013 to 2018 / Federal transfer payments to individuals and subsidies above.

The 38% increase in government obligations was driven by increased net interest on debt, due to higher federal marketable Treasury securities outstanding and increased interest rates, as discussed within Expenditures by function, 2013 to 2018 / Federal net interest paid above.

Fiscal year 2018 compared with fiscal year 2008

	2018						2008						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Education	$	921	$	—	$	921	$	739	$	10	$	729	$	182	$	(10)	$	192		25%		(100)%		26%
Wealth and savings		2,324		1,997		327		1,499		1,336		163		825		661		164		55%		49%		101%
Sustainability and self-sufficiency		110		55		55		120		44		76		(10)		11		(21)	(8)%			25%		(28)%


Total Blessings of Liberty	$	3,355	$	2,052	$	1,303	$	2,358	$	1,390	$	968	$	997	$	662	$	335		42%		48%		35%
As a percentage of total expenditures		53%		60%	45%			51%		55%	46%
Estimated impact of inflation on segment expenditures													$	389	$	229	$	160		16%		16%		16%
Estimated impact of population growth on segment expenditures														176		104		72		7%		7%		7%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

State and local education expenditures

The $192 billion increase in state and local education expenditures was driven primarily by a $139 billion or 24% increase in costs of elementary and secondary education and a $50 billion or 39% increase in costs of higher education.

The 24% increase in costs of elementary and secondary education during this period primarily reflects:

a 16% increase in salaries and wages, including 15% for instruction employees and 18% for support employees; and
a 48% increase in employee benefits, including 49% for instruction employees and 47% for support employees.

Within public elementary and secondary schools, the number of students enrolled increased 3%, while the number of teachers decreased 1%, and the student/teacher ratio increased 4%, from 15.4 to 16.0 students per teacher.

The 39% increase in higher education expenses during this period primarily reflects:

a 57% increase in costs of instruction, including a 34% increase in salaries and wages;
a 61% increase in costs of institutional support; and
a 79% increase in costs of academic support.

Within higher education institutions, the number of faculty and administrative staff increased 10% and 156%, respectively, along with an 8% increase in the number of students enrolled. From 2008 to 2018, the student/faculty ratio declined 2%, from 15.3 to 14.9, while the student/administrative staff ratio declined 58% from 123.7 to 52.2.

Federal wealth and savings expenditures

The $661 billion increase in federal wealth and savings expenditures was driven primarily by a $371 billion or 60% increase in Social Security expenditures and a $198 billion or 51% increase in Medicare expenditures. These increases reflect increased benefits payments, as discussed within Expenditures by function, 2008 to 2018 / Federal transfer payments to individuals and subsidies above.

General government support and other

The costs of central government functions, including general property and records management and general claims against our Government that are not allocable to one agency, are not allocated to our segments and are considered general government support.

Other expenditures include non-grant assistance from the federal government to territories and state and local governments (e.g. direct borrowing subsidies through the Build America Bonds program) and the discrepancy between grants from the federal government to state and local governments as reported by the federal government versus as reported by state and local governments (we assumed the federal government source was accurate).

Fiscal year 2018 compared with fiscal year 2017

	2018						2017						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Costs of central government functions	$	183	$	20	$	163	$	171	$	22	$	149	$	12	$	(2)	$	14		7%		(9)%		9%
Other		(40)		(40)		—		(32)		(32)		—		(8)		(8)		—		—%		25%		—%


Total general government support and other	$	143	$	(20)	$	163	$	139	$	(10)	$	149	$	4	$	(10)	$	14		3%		100%		9%
As a percentage of total expenditures		2%		1%	6%			2%		—%	5%
Estimated impact of inflation on segment expenditures													$	5	$	1	$	4		2%		2%		2%
Estimated impact of population growth on segment expenditures														1		—		1		1%		1%		1%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Other federal expenditures decreased $8 billion due primarily to $8 billion in annual variations in the discrepancy between grants from the federal government to state and local governments as reported by the federal government versus as reported by state and local governments.

Fiscal year 2018 compared with fiscal year 2013

	2018						2013						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Costs of central government functions	$	183	$	20	$	163	$	171	$	24	$	147	$	12	$	(4)	$	16		7%		(17)%		11%
Other		(40)		(40)		—		(34)		(34)		—		(6)		(6)		—		18%		18%		—%


Total general government support and other	$	143	$	(20)	$	163	$	137	$	(10)	$	147	$	6	$	(10)	$	16		4%		100%		11%
As a percentage of total expenditures		2%		1%	6%			3%		—%	6%
Estimated impact of inflation on segment expenditures													$	13	$	2	$	11		8%		8%		8%
Estimated impact of population growth on segment expenditures														6		1		5		3%		3%		3%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Other federal expenditures decreased $6 billion due primarily to $6 billion in annual variations in the discrepancy between grants from the federal government to state and local governments as reported by the federal government versus as reported by state and local governments.

Fiscal year 2018 compared with fiscal year 2008

	2018						2008						Changes ²


(In billions, except percentages)	Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local		Total		Federal ¹		State and Local


Costs of central government functions	$	183	$	20	$	163	$	168	$	16	$	152	$	15	$	4	$	11		9%		25%		7%
Other		(40)		(40)		—		(4)		(4)		—		(36)		(36)		—		900%		900%		—%


Total general government support and other	$	143	$	(20)	$	163	$	164	$	12	$	152	$	(21)	$	(32)	$	11		(13)%		(267)%		7%
As a percentage of total expenditures		2%		1%	6%			4%		—%	7%
Estimated impact of inflation on segment expenditures													$	28	$	3	$	25		16%		16%		16%
Estimated impact of population growth on segment expenditures														12		1		11		7%		7%		7%

Sources & Footnotes

² Key changes are highlighted in gray in the table above and are discussed in the sections below.

Other federal expenditures decreased $36 billion due primarily to $36 billion in annual variations in the discrepancy between grants from the federal government to state and local governments as reported by the federal government versus as reported by state and local governments.

No results found

Share the 10-k

Expenditures by segment

Share the 10-k

Data delivered to your inbox

Expenditures by segment⁴⁵

Justice and Domestic Tranquility (JDT)

Common Defense

General Welfare (GW)

Blessings of Liberty (BL)

General government support and other

Continue exploring

Expenditures by function

Key metrics by segment

Explore the 2021 Government 10-K

Introduction

PART I

About this Report

Item 1 - Purpose and Function of Our Government - General

Item 1A. Risk Factors

Item 2. Properties

Item 3. Legal Proceedings

PART II

Item 6. Selected Financial Data

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Item 8. Financial Statements and Supplementary Data

Item 9A. Controls and Procedures

PART III

Item 10. Executive Officers and Governance

Item 11. Executive Officer Compensation

Item 13. Certain Relationships and Related Transactions, and Director Independence

PART IV

Item 15. Exhibits

Data delivered to your inbox

Share the 10-k

Expenditures by segment

Share the 10-k

Data delivered to your inbox

Expenditures by segment45

Justice and Domestic Tranquility (JDT)

Common Defense

General Welfare (GW)

Blessings of Liberty (BL)

General government support and other

Continue exploring

Expenditures by function

Key metrics by segment

Explore the 2021 Government 10-K

Introduction

PART I

About this Report

Item 1 - Purpose and Function of Our Government - General

Item 1A. Risk Factors

Item 2. Properties

Item 3. Legal Proceedings

PART II

Item 6. Selected Financial Data

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Item 8. Financial Statements and Supplementary Data

Item 9A. Controls and Procedures

PART III

Item 10. Executive Officers and Governance

Item 11. Executive Officer Compensation

Item 13. Certain Relationships and Related Transactions, and Director Independence

PART IV

Item 15. Exhibits

SIGN UP FOR THE NEWSLETTER

Data delivered to your inbox

Expenditures by segment⁴⁵