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Animation: Over 50 Years of U.S. Discretionary Spending in 1 Minute

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Every year, the U.S. government spends trillions of dollars on a wide range of budgetary items.

While the largest categories of spending, such as entitlement programs or debt interest, do not offer lawmakers a lot of flexibility, the government does get to decide how discretionary spending – about $1.3 trillion in FY2019 – gets put to use.

Discretionary Spending Over Time

Today’s animation from data scientist Will Geary shows the evolution of U.S. discretionary spending from 1963 until today:

The U.S. budget is generally divided into three main categories:

Discretionary Spending: This category, depicted in the animation, is the optional part of the budgetary equation – it’s the aspect that most people talk about, as the allocation of funding towards different things like defense, education, and transportation can be changed by lawmakers.

Mandatory Spending: Also known as entitlement spending, this category includes funding for programs such as Social Security, Medicare, and Medicaid. It’s called mandatory spending because the government legally is committed to fulfilling these obligations, and it exists outside of the normal budget appropriations process.

Net Interest: This category is for payments on the national debt, also something that is necessary unless the country is willing to default on these obligations.

Discretionary Spending Today

As the animation shows, after adjusting for inflation (using 2009 dollars), discretionary spending has doubled since 1963.

In 1963, which was essentially the height of the Cold War, the U.S. was spending 73% on the military to make up the vast majority of the $547 billion (2009 dollars) in discretionary spending.

Meanwhile, in Fiscal Year 2019, the government has allocated $1.3 trillion (today’s dollars) to the budget:

2019 Discretionary Budget

Things haven’t changed much since 1963 in that defense still comprises the majority of spending – in fact, the only recent time periods where U.S. defense spending fell below 50% were roughly between 1977-1981 and 1999-2004.

American spending on defense dwarfs all other countries, but there are other categories that make up decent chunks of the discretionary budget as well.

While they seem small on the above chart, transportation (7%), education (7%), and veteran benefits (6%) are all actually categories that receive over $70 billion of annual funding – still a significant piece of change.

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Which Countries Meet NATO’s Spending Target?

In 2023, only 11 member countries reached NATO’s target of spending 2% of their country’s GDP on defense.

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Bar chart showing Nato defense spending by country

Which Countries Meet NATO’s Spending Target?

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

In 2006, NATO defense ministers agreed that each member country would commit a minimum of 2% of its GDP to defense spending.

This graphic breaks down which members are keeping the agreement, based on data from NATO as of July 2023.

Poland Leads Ahead of the U.S.

The North Atlantic Treaty Organization (NATO) is a political and military alliance comprising 31 countries. Its primary purpose is to facilitate cooperation among member nations and ensure mutual defense and security.

In 2023, only 11 member countries were on track to meet NATO’s target of spending 2% of their country’s GDP on defense.

The U.S. accounted for 68% of the total defense expenditures by NATO countries, or $860 billion. This amount is over 10 times more than the second-placed country, Germany, if measured in absolute terms.

However, compared to the country’s GDP, the U.S. appears in second place with spending of 3.5% of GDP, behind Poland’s defense spending of $29.1 billion or 3.9% of GDP.

CountryDefense spending in 2023E (% of GDP)
🇵🇱 Poland*3.9
🇺🇸 United States3.5
🇬🇷 Greece3.0
🇪🇪 Estonia2.7
🇱🇹 Lithuania*2.5
🇫🇮 Finland2.5
🇷🇴 Romania*2.4
🇭🇺 Hungary2.4
🇱🇻 Latvia*2.3
🇬🇧 United Kingdom2.1
🇸🇰 Slovak Republic2.0
🇫🇷 France1.9
🇲🇪 Montenegro1.9
🇲🇰 North Macedonia1.9
🇧🇬 Bulgaria1.8
🇭🇷 Croatia1.8
🇦🇱 Albania1.8
🇳🇱 Netherlands1.7
🇳🇴 Norway1.7
🇩🇰 Denmark1.7
🇩🇪 Germany1.6
🇨🇿 Czechia1.5
🇵🇹 Portugal1.5
🇮🇹 Italy1.5
🇨🇦 Canada1.4
🇸🇮 Slovenia1.4
🇹🇷 Turkiye1.3
🇪🇸 Spain1.3
🇧🇪 Belgium1.1
🇱🇺 Luxembourg0.7

Situated in a crucial geopolitical location in Central Europe, Poland has increased its military spending in recent years, primarily due to concerns about escalating instability along the country’s eastern border with Belarus. According to polls, two-thirds of Poles hold a favorable opinion regarding NATO’s activities.

On the other hand, significant economic and military powers are among the members that are falling short. The list includes France (1.9%), Italy (1.5%), Canada (1.4%), and Germany (1.6%).

Despite being on the 2% list, the U.K. reduced the percentage spent in recent years from 2.14% in 2014 to an estimated 2.07% in 2023.

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