Somehow, I don't think Newsweek is very serious. After all, the money you spend on insurance against a house fire could be spent on food. The money you spend on health insurance could instead be spent on educating your children. And, yes, the money we spend occupying and reforming Iraq and Afghanistan could be spent on day care centers or hiring firemen.
The question that is reasonable is not, "How does this compare to other items in the budget?" (and note: they did not compare to other items in the budget larger than $87 billion, such as Medicare), but "How does this compare with national needs and goals?" Unless Newsweek intends to say - and they might - that we'd do better fighting the war on terrorism by using Federal money to fund community health care than we would by spending the money on the occupation and reformation of the nations at the heart of our enemies' territory, then these comparisons are meaningless. Worse than that, they do not even attempt to make a distinction between valid uses of Federal money (such as defense) and invalid uses (such as spending money on individual AIDS patients).
UPDATE: Yay for MT bugs. I don't know why the date was changed on this post when I deleted a spam from it, but there you have it. Since I don't know the original date, and am too lazy right now to look up the date on the referenced Newsweek article, it'll just stay here.