Which state gets the biggest share of its budget from the federal government?
- Is it California, the left’s bizarre alternative universe?
- Is it Illinois, the poster child for big-government excess?
Nope, not even close. As a matter of fact, those two jurisdictions are among the 10-least dependent states.
And if you’re guessing that the answer is New York, New Jersey, Maryland, Connecticut, or some other “blue state,” that would be wrong as well.
Instead, if you check out this map from the Tax Foundation, the answer is Mississippi, followed by Louisiana, Tennessee, Montana, and Kentucky. All of which are red states!
So does this mean that politicians in red states are hypocrites who like big government so long as someone else is paying?
That’s one way of interpreting the data, and I’m sure it’s partially true. But for a more complete answer, let’s look at the Tax Foundation’s explanation of its methodology. Here’s part of what Morgan Scarboro wrote.
State governments…receive a significant amount of assistance from the federal government in the form of federal grants-in-aid. Aid is given to states for Medicaid, transportation, education, and other means-tested entitlement programs administered by the states. …states…that rely heavily on federal assistance…tend to have modest tax collections and a relatively large low-income population.
In other words, red states may have plenty of bad politicians, but what the data is really saying – at least in part – is that places with a lot of poor people automatically get big handouts from the federal government because of programs such as Medicaid and food stamps. So if you compared this map with a map of poverty rates, there would be a noticeable overlap.
Moreover, it’s also important to remember that the map is showing the relationship between state revenue and federal transfers. So if a state has a very high tax burden (take a wild guess), then federal aid will represent a smaller share of the total amount of money. By contrast, a very libertarian-oriented state with a very low tax burden might look like a moocher state simply because its tax collections are small relative to formulaic transfers from Uncle Sam.
Indeed, this is a reason why the state with best tax policy, South Dakota, looks like one of the top-10 moocher states in the map.
This is why it would be nice if the Tax Foundation expanded its methodology to see what states receive a disproportionate level of handouts when other factors are equalized. For instance, what happens is you look at federal aid adjusted for population (which USA Today did in 2011). Or maybe even adjusted for the poverty rate as well (an approached used for the Moocher Index).
P.S. For what it’s worth, California has the nation’s most self-reliant people, as measured by voluntary food stamp usage.
P.P.S. And it’s definitely worth noting that the federal government deserves the overwhelming share of the blame for rising levels of dependency in the United States.
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This article distorts and overlooks so much that I have to classic as lib logic by a troll or as the left likes to say about the right this is fake news and rather pointless as well as mindless as the other commenters have pointed out better than I ever could. honestly I think sometimes they should fire all the current writers and start hiring the commenters, but not me. I’m retired.
If red States have such great political economic policies to eliminate dependency and create wealth, why would there be any poor people in those States at all, much less more poor in proportion to blue states?
I see that the study only accounts for money returned to the state governments. I believe one of the biggest Federal payout programs goes to individuals. This is the retirement benefits program of the US government. Another issue not covered for grain producing states is the Farm Program.
Nevertheless, California is the worst run state in the nation.
One wonders if the author of this article is aware that the two biggest “Moochers” on the list, Mississippi and Louisiana have been limited to the degree they are permitted to exploit their States Oil and Gas revenues to expand their tax base and state budgets? Unlike Alaska or Texas they cannot get the public return on oil and gas due to rather strident Federal Laws put in place by Jimmy Carter. They get a fraction of the return per barrel that their neighbors get. These two states are kept impoverished by the Federal Government that they are supposedly “Mooching From”. In other words Mississippi and Louisiana are not “Mooching” they are in fact ‘Subsidizing” everybody elses energy costs to their own detriment.
See how much fun shoddy government accounting and politically generated lists can be? This is why we trust the media less and less.
Trust me, Southern states would love to rid themselves of all those worthless welfare transfers. And some of us don’t particularly like so many military bases in our area, either. They are islands of socialism and multicultural propaganda.
The analysis “as a percent of state spending”, as you note, is completely distorted by the size of government in a state. The proper way to analyze it is “federal spending in a state on a per capita basis”, which is easy to do. I did it for 2013 spending. Here is the top 15:
State
District of Columbia 6,131
Alaska 4,075
Wyoming 3,776
Vermont 3,100
New York 2,731
New Mexico 2,688
Mississippi 2,657
Louisiana 2,508
West Virginia 2,415
North Dakota 2,398
Rhode Island 2,386
Montana 2,374
Oregon 2,309
Maine 2,230
Massachusetts 2,184
And the bottom 10:
Georgia 1,579
Texas 1,567
Illinois 1,567
South Carolina 1,491
Colorado 1,479
Florida 1,434
Kansas 1,394
New Hampshire 1,378
Virginia 1,355
Nevada 1,200
Some exceptions, but a pretty clear pattern with DC, Vermont, New York, Rhode Island, Oregon, and Massachusetts joining the military-heavy Southern states in the top 15. The contrast between Vermont and New Hampshire is striking.
This is the tail end of a 150 year ongoing historical mistake. In 1865 the federal armies should have done to the Confederacy what the Scipio’s Roman legions did to Carthage – and then granted them their much-desired independence.
Does this include PILT (payment in lieu of taxes) payments from the Feds? 70% of Idaho is owned by the Federal government, which pays the state an average of 6 cents an acre in PILT payments. If that property were in private hands, the property taxes paid on these thousands of acres would greatly boost the state’s coffers. This land should have been transferred to the state when Idaho became a state, as opposed to being a territory. This is a big problem in the intermountain west, which was the last part of our nation to be settled.
saw it on wordpress so it must be real #derp
This article is poorly done and at a minimum deceptive. Federal welfare funding is due to Federal policies not state policies.
If you wish to define a vampire condition look at State taxes and the ease of doing business. That’s why libtard states are far and away the champion Bela Legosi immitators.
The problem with this is that it ignores the biggest component of federal aid to states — the state income tax deduction. The ability to deduct state income tax from federal tax is nothing other than a transfer of income from the federal government to the state. Using made-up numbers to demonstrate the principle, say a person in Texas pays $10000 in federal income tax. Were he or she living in California, he or she might instead end up paying $4000 to California and $6000 to the feds. That would constitute a $4000 transfer of income from the feds to the state — that *nobody* ever counts in these things.
The methodology used is not only questionable, but a clear deception. What federal outlays would increased state revenues offset? It would not offset Medicare, Medicaid or Social Security. States can enhance some food benefits, but they will not offset federal expenditures on that. Section 8 housing is completely administered by the federal government.
Of course, statists will never learn the lesson here. Take away the federal benefits and the states will decide if and how much welfare and other spending is needed. Should a state wish to spend less on such programs, then they will either prosper, persevere without, or the electorate will decide to increase the state expenditures and taxes as they please. In any case, I won’t be forced at the point of a gun to pay for high speed rail and homeless support in California when I live three time zones away.
The terminology “rely” implies that the state is choosing its course. Indeed it really is the federal that chose the eligibility terms for aid that it funds. And so one can blame the federal government and those residents who chose to apply.
The “poor” states are the ones LBJ paid for with his “Great Society.”