Defense and international security assistance: In 2011, 20 percent of the budget, or $718 billion, paid for defense and security-related international activities. The bulk of the spending in this category reflects the underlying costs of the Department of Defense and other security-related activities. The total also includes the cost of supporting operations in Iraq and Afghanistan, funding for which totaled $159 billion in 2011.
Social Security: Another 20 percent of the budget, or $731 billion, paid for Social Security, which provided retirement benefits averaging $1,229 per month to 35.6 million retired workers in December 2011. Social Security also provided benefits to 2.9 million spouses and children of retired workers, 6.3 million surviving children and spouses of deceased workers, and 10.6 million disabled workers and their eligible dependents in December 2011.
Medicare, Medicaid, and CHIP: Three health insurance programs - Medicare, Medicaid, and the Children's Health Insurance Program (CHIP) - together accounted for 21 percent of the budget in 2011, or $769 billion. Nearly two-thirds of this amount, or $486 billion, went to Medicare, which provides health coverage to around 48 million people who are over the age of 65 or have disabilities. The remainder of this category funds Medicaid and CHIP, which in a typical month in 2011 provided health care or long-term care to about 60 million low-income children, parents, elderly people, and people with disabilities. Both Medicaid and CHIP require matching payments from the states.
Policy Basics: Where Do Our Federal Tax Dollars Go? — Center on Budget and Policy Priorities
