Every year, the Office of Management and Budget publishes historical tables describing the composition of federal receipts and outlays. Navigate to https://www.whitehouse.gov/omb/historical-tables/ to view them. You can see that these detailed tables cover the federal budget’s history from 1940 to present (and in some cases, all the way back to 1789!). These tables also display projections for the federal budget up to four years into the future. Using Table 6.1,

“Composition of Outlays,” discuss how the main categories of federal outlays have changed from 1940 to the present. Where are the biggest projected changes looking four years into the future?

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TABLE 6-1 The Effects of Smoking: Externalities or Not? Effect Not an externality if... Increased health care Insurance companies actuarially raise premiums for smokers. costs Less- productive workers Increased number of fires Employers adjust individuals' wages according to productivity. Smokers set fire only to their own property, requiring no help from the fire department, and insurance companies adjust premiums according to smoking status. An externality if... Many individuals are insured by entities that spread the health costs of smokers among all of the insured; also, the health costs of the uninsured are passed on to others. Employers do not adjust wages according to individual productivity, so that they must lower wages for all workers to offset productivity loss. The fires damage nonsmokers' property, raise the cost of the local fire department, or raise fire insurance premiums for all. Earlier Smokers do not pay Social Nonsmokers save money because