How does the saying, "The federal government is an insurance company with a military," while exaggerating a bit, describe U. S. federal government spending? The saying is true because the U. S. spends more on social insurance than any other country in the world. U. S. spends more on the military than any other country in the world. majority of social insurance spending by the federal government goes towards veterans. federal government spends the vast majority of its budget on the military and social insurance.