Defense Spending Per Capita

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These data have been updated. For the latest research on this topic, see the Budget Agreement that Continues to Promote the Overall Increase in the National Defense Budget.

The U.S. government pays for defense in all states through the purchase of military equipment, salaries for military personnel and civilians, pension payments, medical services, and state subsidies. In fiscal year 2018, the most recent year for which data is available, the federal government spent a total of $579 billion, or $1,772 per person, protecting the states and the District of Columbia.

Defense Spending Per Capita

Defense Spending Per Capita

Each state’s defense spending ranges from $565 in Oregon to $7,455 in Virginia. The District of Columbia received the highest amount in the country at $10,779 per person. (See Figure 1.)

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Federal spending on defense grew by $63 billion from 2017 to 2018, an increase of 12%, due in part to an increase in the spending limit allowed by the bipartisan Budget Act of 2018. That’s the level. increased $186 per person nationwide. .. However, these additional dollars are not evenly distributed throughout the state, mainly due to the type of funds received.

The federal government spends money on defense in all states, and defense spending is the main economic driver for many communities around the country, according to members of Congress.

Defense expenditures are broken down into five main categories: contracts, wages and salaries, severance pay, severance pay, and benefits (see below for details on each). The impact of federal budget changes varies from state to state, as each state’s level and defense spending mix are unique.

Note: Defense spending is defined as spending by the Pentagon on military salaries and wages. Retirement and non-retirement benefits (e.g. military and medical service pensions, respectively); contractual obligations to purchase goods and services such as weapons systems and information technology consulting. Subsidies to states and local governments.

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Source: Bureau of Economic Analysis, U.S. Department of Commerce, State Annual Personal Income and Employment, Individual Current Transfer Receipts (SA35), Pew calculations using data retrieved accessed March 2020., accessed March 2020. U.S. Department of Defense, Office of Local Defense Community Cooperation, “Defense Spending, Fiscal Year 2018” (2020). United States Census Bureau, “Annual Estimates of the Permanent Resident Population in the United States” (March 2020). US Department of Defense, Office of Actuary, “Military Retirement System Statistical Report, Fiscal Year 2018” (2020)

Contracts for the purchase of goods and services such as military equipment, information technology, and operations and maintenance programs account for 62% of total state spending. This is the largest category in 38 states and the District of Columbia. 16 states and counties account for more than two-thirds of total defense spending.

Wages and salaries for active-duty, civilian, reservists, and the National Guard accounted for 24% of total spending and were the largest of the 13 states. In Hawaii, Kansas and North Dakota, wages and salaries account for more than half of total defense spending.

Defense Spending Per Capita

The end-of-term allowance, which is payments to individuals to receive a military pension, accounts for 10% of state spending. More than a third only go to four states: California, Florida, Texas and Virginia.

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For the purposes of this analysis, non-retirement benefits, i.e. payments for medical expenses provided through the military’s Managed Health Care Program, accounted for 3% of expenditures. fee. These benefits range from 8% of spending in Idaho and Tennessee to 0.5% of spending in Connecticut.

Grants, which include funding for state and local governments for programs such as National Guard operations, medical research and development, and basic and applied science, account for 1% of expenditures. pepper. Of all the states, Idaho received the largest share of endowment at 6%.

On February 9, 2018, Congress passed the bipartisan Budget Act of 2018. In particular, this increased the discretionary defense spending limit in 2018 by $80 billion. Due in part to this shift, defense budgets increased in 2018, with real spending increasing by $63 billion from 2017 to 2018, or $186 per capita nationally (see Figure 3) .

This additional funding for 2018 is primarily used for contracts, with an increase of $164 per person nationally. The second-biggest increase was in wages and wages, up $18 per capita nationally, followed by a $3 increase in severance pay per capita and a $0.60 increase in non-retirement spending. on a person’s head. Endowments were the only category that, although small, fell by $0.03 per person, or just 0.2% of total endowment spending.

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Annual changes in spending categories vary from significant to negligible, so the state experiences different effects depending on the combination of dollars received. In fact, some states have seen an overall decline.

Because of the biggest changes in contract spending, the biggest fluctuations are seen in states where the share of money from contracts is relatively large. In Missouri, for example, total funding increased by 68%. The state has the third largest share of overall spending from contracts with 83%. Maine, which experienced the largest drop in defense spending at 39% overall, lost significant contract spending in 2018. More than half (53%) of the defense spending the state received came from contract for that year.

Contract spending increased by 18% per person from 2017 to 2018. Missouri had the largest increase with 97%, while Maine had the largest decrease with a 55% decrease in contract spending. These differences can be attributed mainly to contract changes received during the period. Boeing, Missouri’s largest defense contractor, received $3.8 billion more in contract spending in 2018 than the previous year, while Maine got $717 million for General Dynamics to build the ships. army that I received a small amount of money.

Defense Spending Per Capita

Wages and wages rose the second-biggest, with total spending growing by 4% between 2017 and 2018. Vermont showed the biggest increase at 34% and Arkansas showed the biggest decline at 6%.

Military Spending Per Capita

Retirement benefits have seen spending nationally increase by 2%. This ranged from a 4% increase in Wyoming to a 0.4% decrease in California.

Non-retirement benefits increased 1% from 2017. This ranged from a 7% increase in Wisconsin to an 8% decrease in the District of Columbia.

Only subsidies were down overall, down 0.2% from 2017 to 2018. However, the range was wide, from a 119% increase in Alabama to a 67% decline in Wyoming.

Note: Defense spending is defined as spending by the Pentagon on military salaries and wages. Retirement and non-retirement benefits (e.g. military and medical service pensions, respectively); contractual obligations to purchase goods and services such as weapons systems and information technology consulting. Subsidies to states and local governments. The U.S. Department of Defense’s Office of Local Defense Community Cooperation updated the methodology used to calculate contract spending in its 2018 Department of Defense report. To allow for comparison, the report contains 2017 spending data using an updated method. Pew used updated 2017 figures for year-over-year calculations.

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Ann Stauffer is the director, Colin Ford is the Deputy Director and Laura Pontari is the Senior Associate of the Pew Charitable Foundation’s Financial Federal Initiative.

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