Again, Forced Redistribution Is Now the Main Thing the Federal Government Does

February 15, 2014

The Cato Institute’s Chris Edwards has a new report, breaking down federal spending into five categories.

“How to Spend $3.9 Trillion”


The federal budget includes a vast array of programs in hundreds of agencies. But when boiled down, the budget consists of just five basic spending activities: compensating federal workers, purchasing goods and services, giving aid to state and local governments, transferring wealth through subsidy and benefit programs, and paying interest on the federal debt. . . .

Transfers to individuals and businesses account for 51 percent of federal spending. Some of the largest benefit and subsidy programs are Social Security, Medicare, food stamps, refundable tax credits, unemployment insurance, farm subsidies, and supplemental security income

(Emphasis added.)

Read the whole report (a concise two pages) here.

Related entry: “All the Numbers You Always Wanted on Government Spending (But Were Afraid to Ask)”

2 Responses to “Again, Forced Redistribution Is Now the Main Thing the Federal Government Does”

  1. Without going into a blog post length response, I’ll say it was pretty easy to dismiss. The author creates a non-existent spending category, labels it “transfers”, then uses that to build an argument for how to achieve the greatest cost savings in our national budget. He does outline other areas of waste, but they are all less than the “transfer” category.

    Transfer of funds isn’t a category. It’s a behavior. The real choices are what to spend revenue on, and how much debt to acquire to do it. Those are changeable and negotiable priorities, not the fact that money has to go from taxes to government, then back through a redistribution process. That part is inevitable.

    The whole point of having taxes at all is to pool revenue resources in order to re-allocate them through need-based redistribution. It isn’t “forced”. If you don’t want to do your civic duty and pay taxes, you are free to either take the risk to live as a criminal, or to reside elsewhere under a different balance of taxation and redistribution.

  2. “The whole point of having taxes at all is to pool revenue resources in order to re-allocate them through need-based redistribution.”

    If you think that redistribution is the main point of having taxes or a government at all, then obviously we disagree on some pretty foundational starting assumptions. I’d be happy to argue about those if you’d like, but I’m not assuming you would.

    I think the main thing of interest here (from my point of view) is that redistribution is such a large share of total federal spending—more than half. I think a lot of people (both liberals and conservatives, maybe) are totally unaware of that. I understand that I’m going to disagree with liberals, but I would like my arguments with them at least to happen in the context of both sides’ being aware of basic facts like this one, which is why I’m trying to spread the information.

Agree? Disagree? Thoughts?

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