Federal Domestic Spending Increases 9.3 Percent in FY ’08

WASHINGTON, July 23, 2009 - The federal government obligated nearly $2.79 trillion in domestic spending for fiscal year 2008, up 9.3 percent from 2007, according to a report released today by the U.S. Census Bureau. That’s equivalent to a total of $9,184 per person living in the United States. Entitlement programs Medicare, Medicaid and Social Security comprised 48 percent of all federal spending, accounting for $1.35 trillion. Of that amount, $659 billion went to Social Security. The one-year increase in spending for these three programs was approximately $359 for every person in the United States.

Federal per capita spending was highest for Virginia ($15,256), Maryland ($13,829) and Alaska ($13,730). States that had the lowest federal per capita spending were Utah ($6,255), Nevada ($6,638) and Wisconsin ($7,132).

Published annually since 1983, these statistics are presented in two publications — Consolidated Federal Funds Report: 2008, which describes the distribution of federal funds by department and agency, and by state and county — and Federal Aid to States: 2008, which shows federal grants to state and local governments. These reports do not include interest paid on the federal debt and foreign aid. Additionally, because the American Recovery and Reinvestment Act was passed by Congress in 2009, monetary obligations from that legislation are also not included in these reports.

The federal government obligated approximately $575 billion in grants in fiscal year 2008, which represented nearly 21 percent of federal spending. The three top departments for grant obligations were Health and Human Services, ($374 billion), Transportation ($53 billion) and Education ($37 billion). Combined, these three departments made up 81 percent of all grants for 2008.

Procurement contracts accounted for about $514 billion, or 18 percent, of total federal spending. Of this amount, defense contracts comprised 69 percent, followed by other federal agency contracts (28 percent) and the U.S. Postal Service (3 percent).

Salaries and wages for federal employees accounted for $254 billion (9 percent) of total federal spending. The largest share of that amount was for federal civilian payrolls (39 percent), followed by Defense Department payrolls (36 percent) and U.S. Postal Service payrolls (25 percent).

     Other highlights from the Consolidated Federal Funds Report:

• In addition to direct expenditures and obligations, the federal government committed $1.62 trillion in direct loans, guaranteed loans and insurance. Insurance coverage comprised 78 percent of that total.
• Guaranteed or insured loans made up $314 billion, led by home mortgage insurance, which accounted for $172 billion. Direct loans made up $38 billion, led by federal direct student loans ($27 billion).
• Direct payments for housing assistance reached $11 billion in 2008. The states with the highest per capita spending in this category were Rhode Island ($144), Massachusetts ($104) and New York ($93).
• Total obligations for federal civilian and military retirement and disability reached $103 billion.
• Veterans’ benefits for retirement and disability totaled $39 billion.
• The federal government obligated $183 billion for supplemental medical insurance.
• Total federal obligations for unemployment and compensation were $40 billion.