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Monday, April 27, 2026

US Government Healthcare vs Defence Spending

I saw a statistic that the US spends about 5x as much on public healthcare than on defence.

Unfortunately, this was a misinterpretation of the statistics (that actually refers to total healthcare spend).

It doesn't help that Google Gemini spouts this wrong information too (happily, Grok is better in this regard).

Yet, finding the right figures is important - because in 2024, Medicare spending alone was $1,118.0 billion. So Medicare spending alone in 2024 exceeded defence spending, which the Peter G. Peterson Foundation reports as being $997 billion in 2024.

Given that left wingers keep bitching about how the bloated defence budget is why they can't get universal healthcare, not to mention everything else on their endless wishlist, the fact that Medicare alone costs more than defence (presumably all but the most insane left wingers would not endorse $0 in defence spending), while covering only 18.9% of the population is a pretty powerful refutation of their fantasies.

So I decided to find out what the real figures are.

The KFF reports that in 2024, public healthcare expenditure was $2.51 trillion (which was actually only slightly less than private healthcare expenditure at $2.77 trillion).

So the US government spends just over 2.5x as much on healthcare as on defence.

Even this is an underestimate.

Let us refer to a 2016 paper, which gave the figures for tax-funded health expenditures in the same year (2013) as $1.877 trillion.

This includes government expenditures for public employees’ health benefits, but also tax subsidies for private employer–paid health insurance and other privately paid care.

I do not think tax subsidies should be included in public spending (besides the philosophical question of whether a reduction in tax is the same as government spending, people respond to incentives, so if the favorable tax treatment of health benefits were removed, the amount of tax revenue earned would definitely be lower than today's implied savings), but Government expenditures for public employees’ health benefits was $188 billion in 2013. For sure, they would be higher in 2024 (the same paper projected they would be $356 billion in 2024).

We can look at the paper's projection of Medicare spending to assess how accurate the projection for Government expenditures for public employees’ health benefits might be.

The 2016 paper projected that in 2024, Medicare spending would be $1.2213 billion. That compares favorably to the actual figure of $1.1180 billion (the estimate came out 9% higher than the actual number).

So we can use either the 2013 number or the projected 2024 number for Government expenditures for public employees’ health benefits. Using the former and latter respectively, the US government spent 2.7x or 2.87x as much on healthcare as on defence in 2024.

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