Donald Trump is determined to reduce the federal government, arguing that there is too much inefficiency and waste.But how much does the U.S. federal government spend?About $6.8 trillion in fiscal year (FY) 2024. This amounts to about $19,900 per person in the U.S. The amount the government can spend depends on the revenue it collects (for example, through taxes, tariffs, and other sources). If it needs to spend more than it collects, it borrows, creating debt.
Federal spending increased by 6.7% from FY 2023 to FY 2024. Spending in 2024 was 23.8% higher than in FY 2019, before the COVID-19 pandemic.
From 1980 to 2024, spending increased 2.9 times. The U.S. population also increased during this period, about 1.5 times. As spending grew more than the population, the government now spends more per person, on average.
The federal government allocates funds across a wide range of programs and services. About 17.7% was spent on defense and veterans, and another 16.2% was allocated to state and local governments. Other spending categories include interest payments on the debt and benefit programs like SNAP.
Social Security and Medicare are two of the largest individual programs funded by the federal government. In FY 2024, 21.5% of the federal budget was allocated to Social Security and 12.9% to Medicare. These programs are part of the government’s “mandatory spending,” which is required by law and not subject to annual appropriations by Congress. For example, the federal government is required to provide Social Security payments to all eligible beneficiaries at the levels specified in the Social Security Act, regardless of cost. Congress does not have the power to reduce mandatory spending unless it changes the rules or laws regarding the programs themselves. Mandatory spending increased from 45% of the budget in FY 1980 to 62% in FY 2024.
The second type of federal spending is “discretionary.” This type of spending funds things like education and defense and is subject to appropriations by Congress each year. Congress can increase or decrease discretionary spending each year, depending on national priorities. Discretionary spending accounted for 26% of the federal budget in FY 2024.
In addition to mandatory and discretionary spending, the federal government also has to spend money on interest payments on the national debt. Net interest is the cost of the debt from past borrowing and is not tied to specific programs or policies that Congress can adjust each year.
Source: USA Facts