Two-Thirds On Defense
by Jurgen Brauer and Nicholas Anglewicz

Many Americans believe that 19 cents on defense for every 81 cents on non-defense is a reasonable way to spend a tax dollar. But by another calculation, the tax dollar splits 68 cents for defense and 32 cents on everything else. It is a common misconception that U.S. defense expenditure is equivalent to the Department of Defense outlays. Instead of $436.4 billion of defense expenditure, as Congressional budgeteers count, government statisticians in the Bureau of Economic Analysis (BEA) counted $548.0 billion for calendar year 2004—a whopping $112 billion difference. And by our own calculations, U.S. defense expenditure is much higher than even the BEA's numbers suggest, namely $765.6 billion in calendar year 2004—about $330 billion or 75 percent more than the Department of Defense outlays.

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