Most people are aware that the U.S. Federal Government spending is massive. But when speaking about trillions, it is easy to lose perspective. So how does one put U.S. Government spending into perspective and understand how much money it is? How much does the Federal Government spend, in terms that make sense?
To put this enormous sum in perspective, let’s examine it by households. First, here is the data for the most recent full calendar year regarding how high the U.S. Federal Government spending is:
Additionally, the median household income for 2021 is:
With these two figures, the number of median income households that would have to provide all of their annual income to fund federal government spending for the year is:
So, more than 97 million median income households would have to contribute 100% of their income to fund the federal government’s spending in the 2021 calendar year. There are about 129,224,000 households in the United States, so only a little more than 75% of households would have to give up their income for the year to fund the government’s spending for the year.
Perhaps a GoFundMe is in order. Let’s see what that would look like:
Any takers? Well, more importantly, are there 97 million households who will help fund this project?
The federal government spending takeaway
Clearly, this is a massive sum of money, with scant hope of it being raised in this manner. The government has more persuasive means to raise this money. However, in 2021, total federal receipts only covered a little bit more than half of this spending. They raised about 62% of it from taxes and other receipts (see Federal Government Data). The other 38% was funded with additional debt. This is debt that must be paid back in the future with interest.
The U.S. federal government has a spending problem. We may be running out of time to address it without severe consequences. The first step is to understand what a massive amount of money is being spent. Hopefully, the example on this page drove that point home. It’s not just so many trillions of dollars. It’s a huge amount of money for every household, every family, and every person.
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