World War I US Defense Spending

DURING WORLD War I defense spending in the United States exploded from less than one percent of GDP in 1915 to a peak of 14 percent in 1919 and then back down to one percent by 1923.

But the data series of “Series Y 605-637. Federal Government Expenditure, by Function: 1902 to 1970” in the Census Bureau’s Historical Statistics of the United States: From Colonial Times to 1970 only tabulates federal spending for 1913 and 1922, completely missing out on the years of World War I.

But the Census Bureau does publish annual federal government expenditures in another table, “Series Y 457-465. Outlays of the Federal Government: 1789-1970.” The problem is that the numbers in the two Census Bureau tables don’t match up.

Comparison of World War I Defense Spending (millions of dollars)
Spending Item	1913	1914	1915	1916	1917	1918	1919	1920	1921	1922
Census Bureau Numbers from “Series Y 605-637. Federal Government Expenditure, by Function: 1902 to 1970”
Total Spending	970									3,763
Total national defense	250									875
Military services only	245									864
Interest	23									988
Census Bureau Numbers from “Series Y 457-465. Outlays of the Federal Government: 1789-1970.”
Total Spending	715	725	746	713	1,954	12,677	18,493	6,358	5,062	3,289
Total defense spending	335	347	343	337	618	6,149	11,011	2,358	1,768	935
War Dept. spending	202	208	202	183	378	4,870	9,009	1,622	1,118	458
Navy Dept. spending	133	139	141	154	240	1,279	2,002	736	650	477
Interest	23	23	23	23	25	189	619	1,020	999	991

You can see the problem. The entire war spending effort is missing from the data series that we are using. And in 1913 and 1922 they don’t match up.

We chose to fill in the missing numbers by matching the spending numbers from “Outlays of the Federal Government: 1789-1970” to the numbers on the incomplete “Federal Government Expenditure by Function: 1902-1970.” then track the trajectory of the numbers in the Outlays dataset. Here are the results:

Construction of World War I Defense Spending Dataset (millions of dollars)
Spending Item	1913	1914	1915	1916	1917	1918	1919	1920	1921	1922
Numbers interpolated from Outlay table shown in italic.
Total expenditure	970	1,004	1,050	1,041	2,306	13,054	18,894	6,783	5,512	3,763
Total defense & intl	250	265	264	260	544	6,078	10,943	2,292	1,705	875
Military only	245	259	257	253	536	6,070	10,934	2,283	1,695	864
Interest	23	23	22	22	24	187	617	1,018	996	988

We have interpolated values for national defense and for total federal spending by applying the entire Outlays data items to the Expenditures table by adjusting all numbers so that they match the numbers in the Expenditure table for 1913 and 1922.