Government spending
The spending by governments across the globe tends to cover several services. Education, infrastructure, health services, defense, and agriculture are the primary areas where governments such as the Federal Government in the U.S. spend a significant amount of the budget. If a government has spent more than it receives in taxes, it ends up running a budget deficit. When the government receives more taxes and spends less, it tends to have a budget surplus. When the taxes and spending are equal, it is said to have a balanced budget. In 2009, for instance, the U.S. Government spent more than it had received in taxes. It, therefore, runs a deficit of about $1.4 trillion deficit. This was almost 10% of the U.S. GDP by 2014 (Amadeo, 2018).
Each financial year, many governments have to borrow funds from citizens in the form of taxes and from foreigners to cover their budget deficits. The government may also borrow externally and internally to help in spending through selling securities such as notes bills and treasury bonds. From 1961 to 1997, the U.S. government has experienced budget deficits, while from 1998 to 2001, the government experienced budget surpluses (Amadeo, 2018). Military spending has been pointed out as one of the spending areas that has increased the current budget deficits as well as the U.S. debt. Economists argue that top reduces military and defense spending, Department of Defense (DoD) must cut on the civilian workforce as well as benefits and military bases around the world.
In the fiscal year 2019, the national defense was the most significant discretionary expenditure. The national defense spending in 2019 by the U.S. Federal Government was $678 billion, which was more significant than another defense spending of the next nine largest economies in the world. It is estimated that the U.S. military spending in the period of Oct 1, 2020, to September 30, 2021, will be $934 billion, which will make it the second-largest expenditure after social security (Amadeo, 2018). Spending on defense includes the acquisition of military equipment, military reconnaissance programs, military research and development, DoD overseers operations, among other expenses.