We’re digging into the numbers of this statement: “There are over 2,000 subsidies and 1000 grant programs that cost American taxpayers some $1.5 trillion a year.”
Source of claim
Sam Clovis, a Sioux City Republican running for U.S. Senate
Many Republicans running for Congress want to shrink government. Sam Clovis, a Morningside College professor running for the U.S. Senate seat being vacated by Sen. Tom Harkin, says Congress should cut at least half of the government subsidies “that comprise unnecessary and damaging market interference.”
For Clovis’s claim on his website, iowans4samclovis.com, that “There are over 2,000 subsidies and 1,000 grant programs that cost American taxpayers some $1.5 trillion a year,” he told the Fact Checker that he used data from the Pew Charitable Trusts, which is an independent public policy group based in Washington, D.C., and Philadelphia.
Pew put out a report in July 2012 that outlines federal spending and subsidies to nine economic sectors.
The report shows the federal government spent $822.6 billion on grants in fiscal 2010 across all nine sectors, with the largest share going to the health care sector at $555 billion. Health care spending would include Medicaid, which helps low-income people.
The U.S. Government Accountability Office released a report in September 2012 that said Medicaid grants have more than tripled since 1980. As more federal money is spent on Medicaid, less has been spent on grants to state and local governments for other uses, such as transportation, education and regional development, the GAO found.
Pew points out tax breaks are another kind of subsidy. The trust counted $459.5 billion in tax expenditures, which are “government revenue losses resulting from provisions in the tax code that allow a taxpayer or business to reduce his or her tax liability by taking certain deductions, exemptions, exclusions, preferential rates, deferrals or credits.”
This could include everything from popular tax deductions for children and home mortgages to more obscure programs, such as a credit for plug-in electric cars and trucks.
Housing and health care were about equal for the amount of tax expenditures provided in fiscal 2010, with approximately $188 billion each, Pew reports.
The Pew report also includes a category of federal spending for non-compete contracts, which are government projects awarded without a competitive bidding process. The trust found $112.5 billion of spending on these contracts, with the largest share of $43.3 billion going for transportation.
The GAO report found many problems with federal grant programs, including lack of performance measures, duplication and weak oversight.
Clovis said he also used data from the U.S. Census Bureau, which previously produced a report called the Consolidated Federal Funds Report that listed all programs receiving federal funding. That report was cancelled a few years ago because of budget cuts.
Federal grants, tax expenditures and no-bid contracts came to $1.39 trillion in fiscal 2010, according to the Pew Charitable Trusts. The not-for-profit noted some grant categories, including the Supplemental Nutrition Assistance Program (food stamps), were underreported in fiscal 2010 in USASpending.gov, from which the group gathered data.
Given that this data is a few years old, there may be new grants and tax breaks not included. We give Clovis a “true” for his claim there are more than 2,000 federal subsidies and 1,000 grants worth about $1.5 trillion a year.