Reprinted with permission from Econlib.
In 2022, the U.S. government approved expenditures of $113 billion on aid to Ukraine. The Committee for a Responsible Federal Budget writes:
In total, CBO estimated that $6.6 billion of the $113 billion would be spent in FY 2022 and another $37.7 billion in FY 2023. Furthermore, CBO estimated more than half of the approved funds would be spent by the end of FY 2024 and more than three-fourths by the end of FY 2026.
How much will that cost the average household? There are approximately 131.2 million households in the United States. So the average cost per household is $113 billion divided by 131.2 million, which is $861.
Of course, averages are often under-informative. That’s true of this one. In 2018, according to the Brookings Institute, high-income households, those in the top 20% of the income distribution, paid about 68 percent of all the tax revenue that the federal government collected. To be in the top quintile that year, you needed to have an income of $153,301 or more.
Assume for simplicity that these numbers, adjusted for inflation, are about the same today. Also, I’ll assume, even though I know it’s false, that this $113 billion will be paid entirely out of taxes rather than new debt. It’s not as bad an assumption as it looks. To the extent it’s paid out of new debt and to the extent future taxes pay off that debt, based on a progressive tax structure such as the one we have now, it would be a pretty good assumption.
So the top quintile would pay 68% of $113 billion, which is $76.8 billion. There are approximately 26 million households in the top quintile. So the cost per top-quintile household is $76.8 billion divided by 26 million, which is $2,956.
That’s a lot to fight someone else’s war.
Consider my wife’s and my case. In 2018, our income put us in the top quintile, probably just below the top 10 percent. So because we aren’t socked by high income tax rates to the same extent as the top 10 percent, our cost is probably closer to $2,000 than to $2,956. Let’s say it’s about $2,200.
Put it in perspective this way. In the first month of the war, my wife and I wanted to “do something” to help Ukrainians. A friend recommended giving money to a local restaurant owner who has relatives in Ukraine. She trusts him and we trust her. So we gave him $100. I know that that’s not much, but the $2,200 number above gives an idea of just how “not much.” We’ll pay in federal tax revenues about 22 times the amount we contributed voluntarily.
David R. Henderson is a research fellow with the Hoover Institution and an emeritus professor of economics in the Graduate School of Business and Public Policy at the Naval Postgraduate School. He is author of The Joy of Freedom: An Economist’s Odyssey and co-author, with Charles L. Hooper, of Making Great Decisions in Business and Life (Chicago Park Press). His latest book is The Concise Encyclopedia of Economics (Liberty Fund, 2008). He has appeared on The O’Reilly Factor, the Jim Lehrer Newshour, CNN, MSNBC, RT, Fox Business Channel, and C-SPAN. He has had over 100 articles published in Fortune, the Wall Street Journal, Red Herring, Barron’s, National Review, Reason, the Los Angeles Times, USA Today, The Hill, and the Christian Science Monitor. He has also testified before the House Ways and Means Committee, the Senate Armed Services Committee, and the Senate Committee on Labor and Human Resources. He blogs at http://econlog.econlib.org.
We’ve wasted money on aid to Israel since 1948 and counting. From 2022 and counting we’ve been wasting aid on Ukraine. I don’t know what country will be next.
Biden is causing tension with our frenemies: Russia and China. He wants to look tough and alert since he can’t stand up to the Republicans. He wants to be re-elected even if there are people in the Democratic Party that say he should not.
I am one of them. I do not want to see Biden run again. The only democrat I trust is Dennis Kucinich (who is 76). He read the Articles of Impeachment of President George W. Bush. Of course I realize the DNC will prop up Biden (give him jolly pills to keep him alert), or back a like candidate. A back story is Biden’s attitude about Social Security (has called SS “a sacred cow”), is against expanded Medicare or Single-Payer Medical Coverage. To him, ACA (Romneycare) is a “f*cking big” deal. He and Obama knew there means and ways to kill it.
Even his own legs refuse to support him.
If we didn’t spend on all these stupid foreign wars and maintaining the 800 military bases, we’d EASILY eradicate homelessness, poverty, hunger, and have universal healthcare and free education and still probably have a surplus. Instead, we CHOOSE to deficit spend to high heaven for the military industrial complex over investing in our own country. What a sad state of affairs.
That’s funny pal. You seem to understand the diminishing returns of spending on military, but fail to grasp it in other areas.
Of course, the more we spend on military, the less effective each dollar becomes. And we’ve gotten to the point where the pentagon just loses that money.
Don’t you realize the same thing will happen if we spent that money on homelessness? or poverty? or hunger? or universal healthcare?
All the money we currently throw at these problems is currently being used unwisely at best, and at worst, is downright abused by public officials. You don’t think the problem will only get worse the more money we throw at it?
We said to the military “here’s a trillion dollars a year. Use it to defend our country, and definitely don’t starts wars for foreign conquest.” and they didn’t. Gee, I wonder why. Now you want to take those trillions of dollars and give it to someone to distribute to the homeless and hungry, and you don’t think that will be abused the exact same way?
And people want me to rejoin the above ground economy …..lol.
February 02 2023 Tanks for Ukraine will only prolong war, line pockets of arms dealers: Erdogan
The Turkish president has also doubled down on his opposition to allowing Sweden into NATO following Quran-burning protests in Stockholm
https://thecradle.co/article-view/20992/tanks-for-ukraine-will-only-prolong-war-line-pockets-of-arms-dealers-erdogan
https://media.thecradle.co/wp-content/uploads/2023/02/JDP7HMNU5VIWBOHSKVYKX2E5YU.jpg
$861? Send them a whole bunch of pizzas. At least they won’t bee hungry.
That doesn’t look like a lot.
lets include the extra cheese and the olives – no pizza is complete without the olives and extra cheese.
lets include the annual amount of US public funds being wasted on the MIC then include the total amount that the Pentagone has proven unable to account for.
1.2 Trillion annually plus 23 Trillion = 24.2 Trillion divided by a estimated population of 320 Million works out at a whopping $75625 per person so far and it’s all debt but hey look on the bright side it’s all profit for the privately owned MIC.
The sad part is that Larry and his nefarious ilk will never be happy –
Their incessant and never ending greed is like a toxic weed that’s taken over the garden of democracy [for lack of a better word] which needs to be eradicated faster than a bride’s nighty is carelessly tossed aside on the first night of a young couples honeymoon.
Mr. Henderson says he has given “Ukraine” $100. Mr. Henderson is a very stupid man.