Federal Government Spends 5 Times More on Seniors Than Children, Urban Institute Finds

A recent analysis by the Urban Institute highlights a significant disparity in government spending across generations, indicating that the federal government allocates approximately $5 to seniors for every $1 spent on children. This finding, shared by Connor O’Brien on social media, underscores a broader trend in public expenditure. O'Brien stated, > "Per the Urban Institute, the federal government spends about $5 on seniors for every $1 it spends on kids. Between all levels of government, seniors get twice as much."

According to the Urban Institute's "Kids' Share 2024" report, federal outlays in 2023 amounted to roughly $7,340 per child, while spending on adults aged 65 and older reached approximately $37,700 per person. This translates to the reported 5:1 federal spending ratio. Overall, children received about 9 percent of the $6.1 trillion federal outlays in 2023, while retirement and health benefits for adults, primarily seniors, constituted 43 percent of the federal budget.

When considering all levels of government—federal, state, and local—the disparity narrows, with seniors receiving about twice as much as children. This reduction in the ratio is largely due to substantial state and local government investments in public education and other services for children. State and local outlays on children accounted for 57 percent of total public outlays on children in 2021, the most recent year for comprehensive data.

The higher spending on seniors is primarily driven by the growth of entitlement programs such as Social Security, Medicare, and Medicaid, established and expanded since 1965. These programs have seen legislated benefit increases and rising healthcare costs. Projections indicate that the adult portion of these programs is expected to consume nearly half of federal outlays by 2034, further reducing the children's share of the budget, which is projected to decline to 6 percent. Additionally, interest payments on the national debt are now projected to exceed federal spending on children.

Experts note that while these figures highlight a generational spending pattern, Social Security benefits are largely a return on workers' contributions, not solely a drain on public resources. The escalating costs of Medicare are also a significant factor, reflecting the higher healthcare needs of an aging population and the overall expense of the U.S. healthcare system. The Urban Institute emphasizes that investments in children yield substantial long-term societal benefits, including improved health, education, and future economic productivity, suggesting a need for sustained investment in future generations.