Kids' Share 2018: Report on Federal Expenditures on Children through 2017 and Future Projections

JULYKIDS’SHARE 2 018REPORT ON FEDERAL EXPENDITURES ON CHILDREN THROUGH 2017 AND FUTURE PROJECTIONSJULIA B. ISAACSCARY LOUHEATHER HAHNASHLEY HONGCALEB QUAKENBUSHC. EUGENE STEUERLE ABOUT THE URBAN INSTITUTEThe nonprofit Urban Institute is a leading research organization dedicated to developing evidence-based insights that improve people’s lives and strengthen communities. For 50 years, Urban has been the trusted source for rigorous analysis of complex social and economic issues; strategic advice to policymakers, philanthropists, and practitioners; and new, promising ideas that expand opportunities for all. Our work inspires effective decisions that advance fairness and enhance the well-being of people and places.Copyright © July 2018. Urban Institute. Permission is granted for reproduction of this file, with attribution to the Urban Institute. REPORT ON FEDERAL EXPENDITURES ON CHILDREN THROUGH 2017 AND FUTURE PROJECTIONS 0130 How does federal spending on children compare with interest payments on the debt?32 How much of the projected growth in the federal budget is expected to go to children?34 How does spending on children compare with spending on the elderly?38 A CLOSER LOOK AT FEDERAL EXPENDITURES ON CHILDREN40 How have federal expenditures on children changed since 1960?42 Over time, how has the mix of cash support and in-kind benefits and services for children changed?44 How have individual categories and programs grown over time?46 How targeted are expenditures to children in low-income families, and how has this changed over time?48 Which types of expenditures (e.g., mandatory, discretionary) on children are projected to decline over the next decade?52 Which categories of spending on children (e.g., health, education) are projected to decline over the next decade?56 APPENDIX: METHODS60 REFERENCES64 ABOUT THE AUTHORS65 STATEMENT OF INDEPENDENCE02 ACKNOWLEDGMENTS03 EXECUTIVE SUMMARY04 INTRODUCTION 05 About Kids’ Share06 Glossary08 RECENT EXPENDITURES ON CHILDREN10 How much does the federal government spend on children, and how does current spending compare with recent years?12 To what programs and categories are children’s expenditures directed?14 How did federal expenditures on children change between 2016 and 2017?18 How has the Budget Control Act of 2011 affected spending on children?20 How much do state and local governments contribute to spending on children?22 BROAD TRENDS IN FEDERAL SPENDING 24 What share of the federal budget is spent on children?26 How is the children’s share of the federal budget changing over time?28 How large is the federal budget and spending on children relative to the economy? 02 KIDS’ SHARE 2018ACKNOWLEDGMENTSThe authors are grateful to the Annie E. Casey Foundation and the Peter G. Peterson Foundation for sponsoring this research and to the authors of previous reports on children’s budgets for laying the groundwork for this series. We also express our appreciation to Gina Adams for her careful review, to Brittney Spinner for graphic design, and to Daniel Matos and Olivia Podos for editorial assistance.All photos via Shutterstock. REPORT ON FEDERAL EXPENDITURES ON CHILDREN THROUGH 2017 AND FUTURE PROJECTIONS 03EXECUTIVE SUMMARYPublic spending on children aims to support their healthy development, helping them fulfill their human potential. As such, federal spending on children is an investment in the nation’s future. To inform policymakers, children’s advocates, and the general public about how public funds are spent on children, this 12th edition of the annual Kids’ Share report provides an updated analysis of federal expenditures on children from 1960 to 2017. It also projects federal expenditures on children through 2028 to give a sense of how budget priorities may unfold absent changes to current law. A few highlights of the chartbook: ■In 2017, 9 percent of the federal budget (or $375 billion of $3.9 trillion) was spent on children younger than 19 (page 24). ■An additional $106 billion in tax reductions was targeted to families with children. Combining budget outlays and tax reductions, federal expenditures on children totaled $481 billion (page 10). ■More than three-fifths of expenditures on children are from tax provisions or health programs. Medicaid is the largest source of federal support for children, followed by the earned income tax credit and the child tax credit (page 12). ■The share of federal expenditures for children that is targeted to low-income families has grown over time, reaching 61 percent in 2017 (page 46). ■Looking forward, children’s programs are projected to receive just one cent of every dollar of the projected $1.6 trillion increase in federal spending over the next decade (page 32). ■Under current law, the children’s share of the budget is projected to drop from 9.4 percent to 6.9 percent over the next de