Congressional Budget Office December 3, 2013 The Distribution of - PowerPoint PPT Presentation

Congressional Budget Office December 3, 2013 The Distribution of Federal Spending and Taxes in 2006 Molly Dahl, Microeconomic Studies Division Kevin Perese, Tax Analysis Division

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 $2.7 Spending Trillion Federal $2.4 Revenues 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

Allocated Federal Spending and Revenues, 2006 Analyzed the distribution of most federal spending (88 percent), and virtually all federal taxes (98 percent) in calendar year 2006 Federal $2.3 Spending Trillion Federal $2.4 Revenues 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

Categories of Federal Spending, 2006 Cash and $785 Near-Cash Social Security Billion Transfers Cash Transfers Near-cash Transfers Social Security SNAP Refundable Tax Credits Housing Assistance SSI Pell Grants UI Child Nutrition Programs TANF WIC Means- Tested Veterans’ Benefits LIHEAP Black Lung Disability 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 $785 Near-Cash Social Security Billion Transfers Health Care $481 Medicare Transfers Billion Medicare Medicaid and CHIP Means-Tested Veterans ’ Health Benefits 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 $785 Near-Cash Social Security Billion Transfers Health Care $481 Medicare Transfers Billion Other $1,080 National Defense Goods and Billion Services Other Veterans Affairs National Defense Other HHS Agriculture Education Justice OPM Energy Transportation 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

Categories of Federal Spending, 2006 Cash and $785 Near-Cash Social Security Billion Transfers Health Care $481 Medicare Transfers Billion Other $1,080 National Defense Goods and Billion Services Unallocated Interest $312 Total Spending: Spending On Debt Billion $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 (Billions of dollars) 500 400 Other 300 Social Security 200 100 0 Elderly Nonelderly Nonelderly With Children Without 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 (Billions of dollars) 500 400 300 Medicaid and Other 200 Medicare 100 0 Elderly Nonelderly Nonelderly With Children Without 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 (Billions of dollars) 1,200 800 400 0 Elderly Nonelderly Nonelderly With Children Without 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 (Dollars per household) 30,000 20,000 Taxes 10,000 0 Transfers Transfers minus Taxes -10,000 -20,000 Elderly Nonelderly with Nonelderly without Children 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 Spending, 2006 Cash and $785 Near-Cash Billion Transfers Health Care $481 Transfers Billion Other $1,080 Goods and Billion Services Unallocated $312 Total Spending: Spending Billion $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 (Billions of dollars) 600 400 Allocated Allocated by by Share Share of of Population Market 200 Income 0 Elderly Nonelderly with Nonelderly Children without 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 Spending Minus Taxes, by Type of Household, 2006 (Dollars per household) 30,000 Transfers plus Other G&S (by Share of Population) minus Taxes 20,000 Transfers plus Other G&S (by Share of Market Income) 10,000 minus Taxes 0 Transfers minus Taxes -10,000 -20,000 Elderly Nonelderly with Nonelderly Children without 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 and Revenues Allocated to Nonelderly Households Federal $1.5 $2.7 Spending Trillion Trillion Federal $2 $2.4 Revenues Trillion 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 Health Other Goods and Services Near-Cash Care $375 $175 $920 Billion Billion 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 $375 Billion Near-Cash Transfers By Income Lowest Group 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 (Billions of dollars) 200 Near- Cash Transfers Other 100 Cash Transfers Social Security 0 Lowest Middle Highest Quintile Quintile 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 Health $175 Care Billion Transfers By Income Lowest Group 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 (Billions of dollars) 100 Medicaid and Other Medicare 0 Lowest Middle Highest Quintile Quintile 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 Transfers for Nonelderly Households, by Income Group (Billions of dollars) 300 200 100 0 Lowest Middle Highest Quintile Quintile 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 (Dollars per household) 300,000 DOWN 27% 250,000 200,000 150,000 100,000 DOWN 14% UP 101% 50,000 0 Lowest Middle Highest Quintile Quintile 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

Federal Spending on Other Goods and Services for Nonelderly Households Other Goods and $920 Billion Services Allocated Lowest by Share of Quintile 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 (Dollars per household) 25,000 0 Transfers plus Other G&S (by Share of Market Income) -25,000 minus Taxes Transfers plus Other G&S (by Share of Population) -50,000 minus Taxes Transfers minus Taxes -75,000 Lowest Middle Highest Quintile Quintile 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

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 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