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current expenditures on children

ederal outlays on children increased from $298 to $334 billion between 2008 and 2009, largely as a result of the American Recovery and Reinvestment Act of 2009, which in- creased outlays on children by an estimated $25 billion in 2009. Despite the increase in federal outlays on children, the share of the total federal budget devoted to children de- clined modestly, from 9.8 to 9.5 percent of total outlays. That is, while spending was increasing on chil- dren, it was increasing even more rapidly on other parts of the federal government, largely because of the recession and governmental efforts to bolster the financial, housing, and automotive sectors. F

In addition to outlays from a range of federal programs and refundable tax credits, there was $72 billion in reductions in tax liabilities for families with children, as shown in figure 2. This repre- sents only 8 percent of the roughly $900 billion individual tax expenditure budget.7 Together, federal expenditures on children totaled $406 billion, of which 82 percent was outlays and 18 percent was tax savings for families with children.

Children’s Expenditures by Program and Category

Ten programs account for three-quarters of the total $406 billion in expenditures on children in 2009, with many of these programs showing substantial growth between 2008 and 2009 (see figure 3 for a graph of the 10 largest programs and table

1 for comparison of program expenditures in 2008 and 2009). We estimate that Medicaid spent nearly $74 billion in medi-

cal services for children in 2009, a $22 billion or 42 percent increase over 2008. It now surpasses the child tax credit as the

Billions of 2009 Dollars

$74

$72

$72

$298

$334

$310

Tax reductions

2008

2009

2009 without ARRA

Outlays

FIGURE 2 Federal Outlays and Tax Expenditures on Children in Fiscal Years 2008 and 2009

$400

$300

$200

$100

$0

Source: The Urban Institute and The Brookings Institution, 2010. Authors' estimates based on the Budget of the U.S. Government Fiscal Year 2011.

AN ANALYSIS OF FEDERAL EXPENDITURES ON CHILDREN

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