Except for Medicare, Medicaid, and interest on the national debt, defense contractors are getting the biggest share of Ohioans’ federal tax dollars, according to a new analysis.
Medicare and Medicaid provide health care to more than 144 million Americans, and paying interest on the $39 trillion national debt isn’t really optional. However, policymakers choose to spend nearly $900 billion a year on defense, and allow the Pentagon to ship 54% of that off to wealthy defense contractors such as Lockheed Martin — sometimes for weapons systems of questionable military value.
If you look at the federal tax bill of the average American, that person is giving those contractors more than he or she is paying for food and agriculture, school lunches, housing and urban development, disaster relief and national parks and the environment combined, according to the Institute for Policy Studies’ 2026 Tax Day report.
And that’s before you factor in the cost of President Donald Trump’s war with Iran or the portion of deep cuts to the social safety net that haven’t taken effect yet.
“More than half of Americans are struggling to afford basic necessities,” the report said. “But last year, instead of investing in programs that help people make ends meet, the president and his friends in Congress passed a Big Ugly Bill that cut taxes for the wealthiest Americans, cut health insurance and food assistance for millions of Americans, and added billions in new spending for war and mass deportations.”
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Politicians are quick to harp on fraud and error rates in programs they might not like, such as the Supplemental Nutrition Assistance Program. But they continue to increase the amounts going through the Pentagon to politically connected defense contractors despite a long history of underperformance, profiteering and outright fraud that costs taxpayers billions.
Despite that, Trump is calling for the biggest increase in defense spending in decades while trying to pass off responsibility for Medicare, Medicaid and daycare to the states.
The average American taxpayer last year paid out $1,870 to defense contractors. That’s a third more than she or he paid to support veterans, nearly four times as much as on energy and the environment, and 19 times as much as on science.
Some observers have said that a lack of effective diplomacy is partly to blame for the Iran war and sustained diplomacy is needed if the ceasefire is to hold. Yet the average taxpayer last year gave defense contractors 37 times as much as he or she paid to support diplomatic relations with other countries.
The $1,870 the average taxpayer gave defense contractors is part of a $4,049 expenditure on weapons and the military. By contrast, that person paid $2,491 for Medicaid, $2,200 for Medicare and $4,330 to service the national debt.
All of those expenditures dwarf the $157 the average taxpayer spent to support scientific research — including $92 for NASA.
Olivia Alperstein, a spokeswoman for the Institute for Policy Studies, said cash-strapped Americans should know where their tax dollars are going.
“As the war in Iran drives gas prices sky-high while the cost of living crisis threatens Americans’ ability to afford basic necessities here at home, the majority of ordinary Americans across the political spectrum are deeply concerned about where our tax dollars actually go and how the government will prioritize our communities’ needs,” she said in an email.
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