Sunday, November 11, 2007

Why Would They Lie? Huh?

I have been seeing this pie chart a lot lately:

There is a truck made into this shape driving around Concord, NH, and the bumper-sticker is becoming common. Perhaps it is only big in NH because of the Presidential Primary, and the rest of the country isn't seeing much of this. But it irks me, so I'm reporting on it.

The chart above is intentionally misleading, i. e. lying. The real federal budget looks like this:

What accounts for the enormous discrepancy? The pie-chart on top, the so-called Pentagon Bloat chart, shows what an enormous percentage of the discretionary budget "The Pentagon" takes up. The impression they are trying to create is that military spending takes up over half of all the money the federal government spends. The weasel-word discretionary is slipped in there quietly, like they hope you won't notice. What is the difference between discretionary spending and just plain old government spending? Whatever they want it to be. We have legislated obligations for those large sections called Social Security, Medicare, Unemployment & Welfare, and Medicaid totaling 58% of the federal budget, plus another 9% in Debt Service, and a further 3% in Veteran's Benefits that isn't broken out in the "Pentagon" section of the upper graph. 70% of the federal budget, just ignored.

You might be a person who believes that the 17% spent for Defense is still too much. Fine, then. Next time publish the numbers honestly, and try to make your point honestly.

I should also mention that the seemingly small amount spent on Education is another mirage, as it only represents what the federal government spends on education. State, County, and Local governments do most of that spending, as they should. If I had my druthers, the federal budget for education would be even less. Having George Bush get behind Ted Kennedy's No Child Left Behind idea is exactly the sort of bipartisan cooperation we don't need. Give me gridlock over that any day.


Anonymous said...

It's ironic that the meaning of the word "discretionary" seems to have flipped from it's dictionary definition. I believe that defending the country should be considered a mandatory expense. All of the other expenses shown, which are inferred to be mandatory, are actually discretionary, as they represent money transferred by the govenment that is not required by any of the founding documents. A congress has CHOSEN to create these programs, and can CHOOSE to stop them. It just may happen, that as the Social Security and Medicare programs fail under the weight of the boomers that the congress will CHOOSE to change these programs again.

Anonymous said...

The chart at the top shows how I wish my tax money was spent.

David Foster said...

The dishonest comparison of education vs defense spending, without taking into account the huge state & local expenditures on education, has long been common among "progressives." See my post Cookie Monster.

I'd also point out that Social Security expenditures are not all really "expenses" in a proper accounting sense. If you put money in the bank and later withdraw it, the bank does not show the withdrawal on its ledger as an expense, because it is actually a return of capital.

Anonymous said...

In response to David 9:02am - It's true that Social Security is not technically an expense as, say, light bulb replacement would be.

On the other hand, if it were the "insurance" that it is euphemistically called, then its administrators would all be in jail for malfeasance in the execution of their fiduciary responsibilities. No private insurance plan that I know of works on the Ponzie scheme that Social Security is set up as.

David Foster said...

The comment that SS is a Ponzi scheme is often made, but I don't think it is really correct. SS contributions used to buy Treasury bonds directly reduce the need for the government to sell those bonds to other investors. The debt would be incurred in either case.

The situation is directly analogous to a corporation with a defined-benefit contribution program choosing to invest the contributions excusively in its own corporate bonds. This would not be wise and probably not legal, but it would not be a Ponzi scheme.

Dubbahdee said...

I've seen the bloat-mobile driving around Concord. Not paid a whole lot of attention to it. Just another nh-primary shenanigan by someone with an axe to grind. God bless America.
But thanks for clarifying the nature of the axe. It won't make me pay more attention to the pie chart, but it will allow me to dismiss it more contemptuously.

LomaAlta said...

I agree with Bram. The top chart is how we should spend our federal dollars if the Dept of Education, National Endowment for the Arts, etc. were taken out of it.

Unknown said...

Your blog shows a chart indicating $466 billion dedicated to military related expenses (supposedly amounting to 17% of the budget). This is clearly false. The real expense is $1,449 billion.

Here's the breakdown:

Current yearly US Military expenditure
$965 billion:
• Military Personnel $129 billion
• Operation & Maint. $241 billion
• Procurement $143 billion
• Research & Dev. $79 billion
• Construction $15 billion
• Family Housing $3 billion
• DoD misc. $4 billion
• Retired Pay $70 billion
• DoE nuclear weapons $17 billion
• NASA (50%) $9 billion
• International Security $9 billion
• Homeland Secur. (military) $35 billion
• State Dept. (partial) $6 billion
• other military (non-DoD) $5 billion
• "Global War on Terror" $200 billion [$162 billion added to the last item to supplement the Budget's grossly underestimated $38 billion in "allowances" to be spent in 2009 for the "War on Terror," which includes the wars in Iraq and Afghanistan]

Past Military expenditure
$484 billion:
• Veterans' Benefits $94 billion
• Interest on national debt (80%) created by military spending, $390 billion

$484 billion + $965 billion
= $1,449 billion

Current yearly US gov tax income
$2,566 billion:
• $1,163 billion - Individual income tax
• $869.6 billion - Social Security other payroll taxes
• $370.2 billion - Corporate income tax
• $65.1 billion - Excise taxes
• $26.0 billion - Customs duties
• $26.0 billion - Estate and gift taxes
• $47.2 billion - Other

$2566 billion - $869 billion
= $1,697 billion

$1,449 billion / $1,697 billion
x 100%
= 85%

Excluding Social Security income from the equation, the percentage spent on the military related expenditures becomes 85%. You want to talk about Commie government redistribution, this is as cynical and predatory as it gets. I don't care about fake wars, the oil mafia, and fat cat military contractors getting even fatter on war profiteering, but I do care about the American middle class having to pay thru the nose for that.

@nooil4pacifists said...

AVI clearly is right. Mətušélaḥ provides no basis for excluding Social Security (or other entitlements) from the calculation, nor a source for the claimed “augmented” defense budget (especially the interest figure).

John said...

I don't understand how politicians and TV news have managed to always have everyone treating statistics as a subjective matter when you can now download the official spreadsheet (though I'm sure the folks around here will attack Obama for putting this all online at the start of his first term as well).

It's all here: