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NEWS ITEMS


Declining Share of Federal Spending for Children
Detail: Kids' Share 2008, a study from the Urban Institute and New America Foundation shows that children are a diminishing priority in the federal budget. The study tracked federal spending on children from 1960 through 2018 based on actual budget outlays and projections of spending under current policies and suggests that historically children have not been a budget priority. If current spending and revenue policies continue, the children’s share of domestic federal spending—which excludes defense, non-defense homeland security, and international affairs—will be 13.8 percent in 2018, down from 16.2 percent in 2007 and 20.2 percent in 1960.

The authors of this report classify more than 100 federal programs that spend money on children in eight categories: income security, nutrition, housing, tax credits and exemptions, health, social services, education, and training. The report defines children as those under age 19 who are not in postsecondary education. The second annual “Kids’ Share” report estimates that the children’s slice of gross domestic product will decline from 2.6 percent in fiscal 2007 to 2.2 percent in fiscal 2018, while Social Security, Medicare, and Medicaid will rise from 7.9 to 9.6 percent.

Findings: Changes from Fiscal Year 2006 to 2007
• The children’s budget inched up 0.7 percent (1.6 percentage points slower than GDP) while the non-child portions of the three major entitlements (Social Security, Medicare, and Medicaid) rose 5.2 percent. The rest of domestic programs declined by 8.6 percent.
• Of the major children’s spending categories, only health, which grew 4.5 percent in real terms, gained ground relative to the economy. Education, which fell 2.1 percent in real terms, lost the most ground.

Findings: Fiscal Years 1960–2007
• Between 1960 and 2007, spending on children rose from 1.9 to 2.6 percent of GDP. By comparison, spending on the non-child portions of Social Security, Medicare, and Medicaid nearly quadrupled from 2.0 to 7.9 percent of GDP.
• Spending on a number of individual children’s programs tended to fall behind economic growth and, often, inflation. The children’s budget maintained its share of GDP mainly through the introduction of new programs. By contrast, the sums spent on entitlement programs, mainly for the elderly, tended to outpace growth in the economy and prices.
• Real federal spending per child grew from $819 in 1960 to $4,680 in 2005. Spending on Social Security, Medicare, and Medicaid rose from $3,057 per senior to $20,530.
• Spending has increasingly been directed toward low-income children through means-tested programs, rising from 11 percent in 1960 to 59 percent by 2007.

“Kids’ Share 2008: How Children Fare in the Federal Budget,” by Adam Carasso, Eugene Steuerle, Gillian Reynolds, Tracy Vericker, and Jennifer Macomber was sponsored by First Focus and the Annie E. Casey Foundation. The study is available at http://www.urban.org/url.cfm?ID=411699.
Source: http://www.urban.org/publications/901182.html
Date: July 10 2008