December 12, 2012

"How Much of Each State's Budget Comes From the Feds?"

"From 24% (Alaska) to 49% (Mississippi)."

56 comments:

Seeing Red said...

I saw that. NY is 40%. LOLOLOLOL

It's how they figured it. The devil is in the details.

What did they use?

AZ has a lot of issues with illegals. Is all of this factored in? Does it count SS?

A lot of red states have Native Americans, how is their portion calculated?

Seeing Red said...

ND & Alaska have something in common, I wonder what it is?

Ann Althouse said...

It's percentage of the state's budget, so the states that have high state taxes are going to have a larger total number. That's the key to understanding this ranking.

Lucid said...

That's so sad. We tithe to the pharaoh and the pharaoh distributes.

MadisonMan said...

ND & Alaska have something in common, I wonder what it is?

Cold!

shiloh said...

It was somewhat amusing when Haley Barbour (MS) was considering a 2012 presidential run.

But at least he would have won his home state ... if nominated lol.

EDH said...

Ann Althouse said...
It's percentage of the state's budget, so the states that have high state taxes are going to have a larger total number. That's the key to understanding this ranking.

Plus, I don't think that "general revenue coming from Washington" number includes the "tax expenditure" value of the federal personal deductibility of state taxes, which might move the actual federal subsidization numbers more toward the higher tax, higher expenditure blue states.

Wally Kalbacken said...

Talk to de pharaoh an evarbody get some!

Freeman Hunt said...

Interesting. You might guess that the most sparsely populated states would get the highest percentage from the Feds because federal infrastructure would make up a larger portion of the total infrastructure.

But then you'd (I'd) be wrong.

MadisonMan said...

That's an interesting part of the the story about distribution of money to the states. But I'm suspicious about Virginia, right next to DC, having such a (relatively) low percentage.

Seeing Red said...

It would be interesting to know the specifics.

Freeman Hunt said...

Shiloh, careful. Poking fun at the fiscal needs of Mississippi? Someone might take you for a racist.

Seeing Red said...

That's what I thought as well because of the naval yards. MD is now just an extension of the Pharaoh's workforce.

LA is high. Is it because of the after affects of Katrina? Is that part of MS' problem?

I didn't think New Orleans came back, I thought a lot of citizens decided not to return?

Seeing Red said...

Bubba put a lot of UT off limits, that's federal land, which UT is still fighting in the courts against.

Freeman Hunt said...

LA is high. Is it because of the after affects of Katrina? Is that part of MS' problem?

I was wondering the same thing.

What's the deal with SD and TN?

Calypso Facto said...

South Dakota (45.56%, #4) / North Dakota (25.99%, #48) split is an interesting study in neighbors and (I assume) oil revenues.

shiloh said...

Freeman, I've been called everything under the sun, including racist, at political blogs.

Not to worry as it's harmless, except if you're a deranged/obsessive political blogger.

And even then it's pretty much harmless! :)

Seeing Red said...

Greg Mankiw linked to the WSJ, they had a "Make Your Own Deficit-Reduction Plan."

Mine was $99 billion in the black and I didn't raise the income tax rates.

There weren't enough options, tho.

Wally Kalbacken said...

I suspect that LA is high because of the military bases and the federal expenditures on flood control (Army Corps of Engineers, etc.) which are big time year in and year out, not just specific to Katrina. Then add a relatively low income general population (a greater than average share of which gets Medicaid and Food Stamps) and you're there.

edutcher said...

In other words, 24 - 48% too damn much.

shiloh said...

Freeman, I've been called everything under the sun, including racist, at political blogs.

Not to worry as it's harmless


Only because he says so.

But it's revealing he says that.

Just as it's revealing how he runs and hides when something blows all his nonsense out of the water.

Seeing Red said...

Don't forget the sugar & rice lobbies.

shiloh said...

It's revealing how Althouse #1 er #2 doting, trained seal keeps making a complete idiot of himself 24/7.

ok, all I ask for is consistency ...

Tim said...

Ann Althouse said...

"It's percentage of the state's budget, so the states that have high state taxes are going to have a larger total number. That's the key to understanding this ranking."

No.

It is a percentage of the state's budget, yes.

High state taxes would most likely drive down the percentage of Federal funds to a state's budget, as the Federal funds are intergovernmental transfers to state-run federal programs.

These are not direct transfer payments to state residents, like Social Security or Medicare.

The biggest such state-run federal program is Medicaid.

It isn't the only one, but it is the biggest, by far.

So, states with higher percentages of federal funds in their state budgets are more likely to have to common features: 1) large (as a percentage) populations on Medicaid; 2) smaller state government relative to it's state-run, federally funded Medicaid program. This explains Mississippi, which which many generally agree has a fairly limited, inexpensive state government as compared to other states.

This percentage of federal funds for state budgets has almost no correlation whatsoever to state income taxes (yes, Medicaid requires a state funding match, but the match varies by state, per law.) No one who knows these things really believes Mississippi is a "high tax state."

Tim said...

MadisonMan said...

"That's an interesting part of the the story about distribution of money to the states. But I'm suspicious about Virginia, right next to DC, having such a (relatively) low percentage."

Virginia has a fairly large and expensive state government relative to it's Medicaid population, i.e., it does a lot more beyond Medicaid, and Mississippi does a lot less than Virginia beyond Medicaid.

This isn't hard to figure out, people.

Seeing Red said...

It's a poor piece of work without giving the underlying specifics.

Aren't we having this higher tax is good argument now?

rehajm said...

...has a fairly large and expensive state government relative to it's Medicaid population

I was working this up, Tim beat me to it. The size of self generated state government revenue relative to federal Medicaid receipts is the driver here.

Tim has it.

Tim said...

Geezus.

This is really simple.

The header on the linked piece at the TaxProf Blog reads:

"The Tax Foundation map below looks at "how much of each state's budget comes from the federal government. Mississippi tops the list with 49% of its general revenue coming from Washington; Alaska, by contrast, gets only 24% of its general revenue from the feds."

The TaxProf Blog links to the Tax Foundation, which posts this above the map:

"Today's Monday Map looks at state government budgets - specifically, how much of each state's budget comes from the federal government. Mississippi tops the list with 49% of its general revenue coming from Washington; Alaska, by contrast, gets only 24% of its general revenue from the feds."

So, to break it down, these are federal funds for federal programs run by states, of which Medicaid is both the best example and the most expensive.

These aren't federal funds for federal programs run in states, such as military bases, nor federal funds spent in states such as disaster relief, nor are they federal funds directly transferred to residents of states such as Social Security, Medicare or military pensions.

These are intergovernmental transfers from the federal government to state governments to run federal programs in states, for which, as noted above, the best and largest example is Medicaid.

And, for the trolls, this has almost nothing to do with "blue states supporting red states."

Paul said...

And how many of these state budgets get extra money by having income taxes that are deductible from their 1040 forms???

How much does NYC, NY, California, etc... get money from the feds by DEIGNING that money?

I bet NYC and California get a hell of a lot more money that people think by doing that. Mississippi DOES NOT HAVE A INCOME TAX. Neither does TEXAS.

Thus there is on income tax to deduct and not send to the federal government.

The BLUE states rip off this country more than most people would ever believe.

rehajm said...

MadisonMan said...

ND & Alaska have something in common, I wonder what it is?

Cold!


Perhaps not coincidentally, they also have fewer Medicaid recipients. The cold kills off the weak and unhealthy?

We're all just living one long episode of Wild Kingdom

Tim said...

Paul said...

"And how many of these state budgets get extra money by having income taxes that are deductible from their 1040 forms???

How much does NYC, NY, California, etc... get money from the feds by DEIGNING that money?

I bet NYC and California get a hell of a lot more money that people think by doing that. Mississippi DOES NOT HAVE A INCOME TAX. Neither does TEXAS.

Thus there is on income tax to deduct and not send to the federal government.

The BLUE states rip off this country more than most people would ever believe."


Paul,

This is about intergovernmental transfers from the feds to the states to run Medicaid.

There's some more there (e.g., DSH funding for uncompensated care at hospitals), but in the end, probably about 90% of these federal funds are for Medicaid.

SteveR said...

There's some simple lessons in there but well beyond honest political discussion. Federal money is a powerful political tool. Ask President Free Birth Control.

edutcher said...

shiloh said...

It's revealing how Althouse #1 er #2 doting, trained seal keeps making a complete idiot of himself 24/7.

ok, all I ask for is consistency ...


I'm not the one who constantly runs around, yelling, "Nyah, nyah, I won, Ned Silver said so. I'm so smart and you're so dumb".

Now that's idiocy.

But, then, look who the little weasel chose to be his Messiah.

Freeman Hunt said...

So, states with higher percentages of federal funds in their state budgets are more likely to have to common features: 1) large (as a percentage) populations on Medicaid; 2) smaller state government relative to it's state-run, federally funded Medicaid program. This explains Mississippi, which which many generally agree has a fairly limited, inexpensive state government as compared to other states.

Makes sense.

shiloh said...

Althouse #1 doting, trained seal is the fool who runs around, 24/7, sayin' the election was stolen.

Boo frickin' hoo!

And no, I just quote what cons have previously said at Althouse as their humiliation is self-evident!

edutcher said...

Me and 24% of the population, sweetie.

And that's according to one of the polls that Ned Silver said was "right".

I also seem to recall the little weasel complaining that OH stole the election from Lurch.

But, of course, that doesn't count because vote fraud is OK if the Demos do it.

PS Be afraid. Especially since it's come out Dr Evil invested heavily in the companies that write the voting machine software after is Secretaries of State project went a-glimmering.

Rocketeer said...
This comment has been removed by the author.
Rocketeer said...

This is about intergovernmental transfers from the feds to the states to run Medicaid.

On admittedly quick first glance, it appears that cold states run about 34-36% or below. Warm (or alternatively, read "traditional 'retirement' states") tend to be above. Could it be as simple as old yankees moving south and old southerners staying put, doubling the geezer population?

jk said...

One issue I have not seen factored in to these "fed subsidies to states" studies is the impact of deductibility of state taxes against fed taxes. This is a real subsidy although it's indirect. It favors high tax states like NY and Cali over low- and no-tax states. Without it, the real impact of high taxes in those states would be significantly greater. If the GOP were smart, they'd make this an issue.

Hagar said...

When you have federal installations in a state, there is also a lot of infrastructure outside those installations necessary to support them. And you often have some very creative stories to justify money transferred to states with long-lived senators and representatives.

Hagar said...

It will cost about yeay much to run a government, and the money has to come from somewhere. I would think that if a state has no, or low, income tax, it will have high sales tax and/or property taxes. (Like AA's 15 G's in Madison - I could not afford to have my house teleported to Madison!)

I think most all jabbering about taxes that we hear is just that - jabbering - since no one considers all of the multifarious ways Federal, State, and Local governments have devised to tax us. Understandably so, because it is way to complicated to be compressed into soundbites.

Rabel said...

Mississippi does have a state income tax.

Paul said...

Yea but Texas and a heck of a lot of others don't.

States do get $$ from the feds but the feds get it from the citizens in those states. And those states with income taxes take money that was ment for the federal government.

So you see, Texas CITIZENS pay quite a share of the federal budget. But see, I don't believe in Texas secession. I think we ought to vote those that don't pay their 'fair share' OUT.

Ops.. 'fair share', wonder who keeps saying that to the public?

Well if it's good enough for 'O', it's good enough for me.

rehajm said...

Oye! Watching people wrestle with the information in this chart is painful...


The Tax Foundation and everyone here gets this for the holidays.

Chip S. said...

rejahm, you're assuming that the purpose of all such charts is to convey information accurately.

AJ Lynch said...

Tim & Rejahm are saying the more pertinent metric to look at would be federal dollars per state resident?

rehajm said...

rehajm, you're assuming that the purpose of all such charts is to convey information accurately.

I would never make such an assumption, but your general point is fair and accurate. In this instance however, deception isn't the issue, it's clarity. Ann and the good people here wrestle with what they're supposed to conclude. It's only obvious if you have knowledge of the nature of federal funding and taxation, information you're not necessarily given. 'Bad' is a more accurate description than 'Deceptive'.

Tim said...

AJ Lynch said...

"Tim & Rejahm are saying the more pertinent metric to look at would be federal dollars per state resident?"

I can't write for Rejam, but as he understands this as I do, I think he might agree the more pertinent metric is just the opposite: state dollars per state resident.

That too would be imperfect though, because the Fed's reimbursement rate for Medicaid varies.

From Medicaid.gov:

"The Medicaid program is jointly funded by the federal government and states. The federal government pays states for a specified percentage of program expenditures, called the Federal Medical Assistance Percentage (FMAP).

FMAP varies by state based on criteria such as per capita income. The regular average state FMAP is 57%, but ranges from 50% in wealthier states up to 75% in states with lower per capita incomes (the maximum regular FMAP is 82 %)."


This would be another reason why Mississippi, relative to other states, has a higher rate of federal funds than other states with higher per-capita incomes.

Also, to be fair, Federal funds to state budgets just isn't about Medicaid (although it is the largest, most expensive program, year to year); there are other programs - most recently the ARRA (i.e., "stimulus") directly funded a multiplicity of state (and local) programs through their budgets.

But, back to Mississippi, this isn't an "Obama vote buying" program. We all know Mississippi is a deep Red state, and the Federal funds were for the federal Medical program, run by Mississippi. It wouldn't have mattered if McCain (or Romney) had defeated Obama - the intergovernmental transfers would have happened at nearly the same amounts (allowing for fluctuations in caseload as driven by economic conditions).

Does that help?

mccullough said...

Mississippi has the highest percentage of blacks of any state.

New Mexico has the highest percentage of Latinos of any state.

Blacks and Latinos tend to be disproportionately poor.

So Mississippi and New Mexico receive a disproportionate amount of federal aid for means-tested programs.

South Dakota has a relatively high percentage of Native Americans (who are also disproportionately poor; Alaska has the most and New Mexico has the second most; SD is third). South Dakota, unlike Alaska and ND doesn't have the oil industry.

leslyn said...

If Mississippi has filed to secede, we should take them up on it.

MadisonMan said...

The only thing I know about Mississippi -- and this knowledge is now almost 30 years old -- is that it costs an eNORmous amount of money to get a license plate for a car.

That was in '84 though, and part of the reason I Lived in Louisiana.

Tim said...

leslyn said...

"If Mississippi has filed to secede, we should take them up on it."

Uh, yeah, that would be smart.

See, Mississippi spends $4.1 billion total on Medicaid, of which $3.5 billion is drawn down in federal funds, or 1.1% of all Federal Medicaid funding.

California, on the other hand, spends a total of $42.1 billion on Medicaid (ten times Mississippi's total), $25.7 billion (more than seven times Mississippi's amount) of which is Federal funds. This is 10.7% of all federal spending on Medicaid.

So yeah, it would be totally smart to let Mississippi secede. Totally smart.

Chip S. said...

If MS seceded and adopted a small-government constitution, the rush of businesses into the new republic would actually turn a bunch of those income-support recipients into taxpayers.

The rest would move to Alabama.

mccullough said...

Leslyn,

Why do hate black people?

pbAndjFellowRepublican said...
This comment has been removed by the author.
pbAndjFellowRepublican said...

"If MS seceded and adopted a small-government constitution, the rush of businesses into the new republic would actually turn a bunch of those income-support recipients into taxpayers."

Palin can be their president: apparently, race still matters to the good Tea Party GOP voters of Mississippi, with 46 percent of the respondents indicating that interracial marriage should be illegal. And in good news for Sarah Palin, those who supported her were significantly more likely to oppose marriage across the colorline.

Chip S. said...

I just threw away one minute of my life reading the idiotic article at your link.

I already knew that logic wasn't a strong suit of the left; you don't have to keep proving it for my benefit.