Left In Lowell

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December 9, 2010

If You Hate Spending, Give Me Back My Money

by at 1:01 pm.

If there’s anything I wish we could get through the thick skulls of American voters, it’s this information.

The “red” states up in arms about government spending receive the largest share of it. This is not a new finding, but research by economist Gary Richardson at the University of California-Irvine backs it up.
[…]
It isn’t surprising that the more Republican a state leans, the more likely it is to be furious about government spending. But what is surprising is that states with the highest anti-spending sentiment appear to be the largest beneficiaries of government spending. Not only do red states swallow the lion’s share of government spending, but Richardson found a linear relationship between the extent of GOP support in a state—and, by implication, the fervor of its anti-government sentiment—and the amount of federal largesse the state receives.
[…]
The 28 states where George W. Bush won more than 50 percent of the vote in 2004 received an average of $1.32 for every dollar contributed. The 19 states where Bush received less than 50 percent of the vote collected 93 cents on the dollar.

“Voting Republican paid large dividends,” Richardson wrote in a piece published in the Economist’s Voice. “For each 1 percent of the population voting in favor of the Republican presidential candidate, the state received an additional 1.7 cents in benefits for each dollar in taxes.”

Vedantam also gives us the polar opposite examples…Alaska, an über conservative state, gets back $1.64 for every $1 they send to the federal government, while Massachusetts receives 82 cents for every dollar it send to the feds.

My first comment is, if those conservative hypocrites hate government spending so much, than give us our money back. Massachusetts could do so much with an extra 20% boost in the federal dollars we receive. Maybe, single payer universal health care? Or super cheap or free higher public education? Then we’d really be positioned to kick global economic butt.

But Vedantam doesn’t end there. He goes back to before there was this red-state-blue-state spending disparity, to tell us something even more insidious.

During the 1970s and 1980s—throughout the Carter, Reagan, and George H.W. Bush administrations—there was no correlation between anti-spending sentiment and getting lots of federal money. The net return to states that voted for Republicans was relatively flat, meaning that “red” states didn’t get most of the pie.

But that changed around 1994—after the last Republican takeover of Congress. […]

Buried in the fine print of Newt Gingrich’s “Contract With America,” Richardson found an income redistribution scheme. The proportion of government spending on groups that traditionally supported Democrats fell. The proportion of government income from groups that traditionally supported Democrats rose.

“Tax rates declined more for groups that tended to vote Republican. These groups include people with incomes in the upper tail of the distribution, such as small business owners, property owners, and investors accruing capital gains. … At the same time, expenditures fell more for programs directed toward people that tended to vote Democratic. These groups included welfare recipients, inner-city residents, and individuals in the lower tail of the income distribution.”

In other words, this appears to be a deliberate plan to under-fund the blue states. It’s like the starve-the-beast scenario, only starving blue beasts only. But the explanation for this disparity in which states get more or less funds than they put into the kitty has largely been explained as a progressive income redistribution - richer states subsidizing poorer states who can’t afford adequate funding levels for education, retirement, or social net programs.

The article goes on to dispute that idea, and you can read it yourself, but the point here is, it’s severely hypocritical for conservatives to disparage government spending, since their beloved red states, their base, are the ones who are costing us the most money - being subsidized heavily by those alleged “big liberal spenders.”

Again, if you don’t want our money, please - give it back. Or for heaven’s sake, at least admit the fact that you are a filthy, dirty hypocrite conservative.

18 Responses to “If You Hate Spending, Give Me Back My Money”

  1. Christopher Says:

    This reminds me of a scene from The West Wing in which during a debate President Barlet’s opponent started complaining about spending and saying states should fend for themselves. The President started ticking off all the federal spending benefiting Florida, of which his opponent was Governor, and ended by asking, “Can we have it back please?”

  2. Publius Says:

    Lynne,

    To extend yout thesis to the logical extent, as an advocate for government spending, you must pay the higher Massachusetts income tax rate. I am also sure that you send the government at all levels extra money. It is best to lead by example.

  3. C R Krieger Says:

    These are facts in evidence and I thought everyone knew it.  Actually, I tend to think of it in terms of Massachusetts and a whole bunch of states, rather Red vs Blue states (and whoever invented that graphic rule?).

    The other thing I think of is what money goes for.  The Commonwealth did get a lot of money for the Big Dig, but aside from that, where are we?  Unlike Alaska, with its very small population (remember that point form 2008?), we have no Elmendorf (F-22s and AWACS and C-17s) or Eiselson AFB (F-16s, I think) or Fort Richardson or Fort Wainwright.  We have no Fort Greely, with an ABM Interceptor site.  And, I suspect, if there was a plan to put an ABM site in our Commonwealth, there would be a lot of protests.

    Would we want a (huge) Fort Hood (Texas) or a Fort Carson (Colorado)?  Maybe not.&nbsp. What about that big mass of naval power in Norfolk, Virginia? I think I have counted five aircraft carriers in port at one time in recent years.  That is a lot of ships, and a lot of dependents spending their spouses’ money, for rent and for food and clothing and for sales tax.  And add in all those civilian workers supporting that operation.  We do have some defense contractors, and money flows into Massachusetts via them, but our heyday of shipbuilding is gone, along with our Naval Shipyard (and the aforementioned ships).

    It is all in the accounts.  We just have to check the books.  I don’t think they are being cooked.  But, choices have consequences.

    Regards  —  Cliff

  4. Greg Page Says:

    D’oh! I wrote a long comment earlier but somehow zapped it before submitting…besides what Cliff said, a lot of this has to do with the way the senate is set up to try to apportion power equally among the states…this tilts things towards places like AK and WY, as does a committee system base d on seniority, which favors senators who represent smaller numbers of people and have tighter grips on their power

  5. Mr. Lynne Says:

    One thing that is often missed, is that there are structural reasons beyond some kind of political inequanimity that so called ‘donor’ states wind up paying more. Most of these donor states are centers of greater economic output. Certainly the naval installations of VA count for something, but the financial centers of Boston and NYC and the technology centers of CA and WA count for a lot more economic activity overall.

    Also note that spending on infrastructure in more population dense areas can be more efficient. When the NH the State SC ruled that they needed to find a way to deal with the overly disparate levels of funding for school systems in the state, they created a legal framework for the distribution of funds that were locally levied at the municipal level, usually property taxes. This resulted in a situation where some towns could be considered ‘donor’ towns and others could be considered ‘recipient’ towns, creating what many considered a fiscal injustice.

    But this was just illustrative of a structural reality regarding the way wealth, economic production, real estate prices, the geographical variation of the potential efficiencies of spending. In the case of the NH schools, variations in real estate based taxes limited potential funds able to be levied for municipal coffers. Also, the efficiency of actually building and operating schools varies with population density, further burdening the property tax levies in rural areas of the state. Thus the percentage of the total revenue burden of the local levy on schools vs all the other things that such a levy was responsible for in the municipal budget ended up being unsustainable in many cases. To solve these problems budgets were often inadequate (as far as the court was concerned) for funding for the school - which was a problem in a state that obligated the government to give every child an adequate education right in its constitution.

    The point is that distributing funds in geographic proportion to their levying would create a problem because there are differences in the geography that create structural variations in they way those levies can be spent. Ignoring these structural variations wastes money because you have to keep in mind the particular ‘fiscal geographical variations’ in order to keep any kind of monetary inefficiency.

    In short, it isn’t necessarily ‘unjust’ that tax levies are distributed this way. Like so many things in the real world, the devil is in the details.

  6. Lynne Says:

    Like I said, I’m all for prosperous states paying for the poor ones who can’t afford their education systems and the like - however, it would be nice to have those subsidized poor states acknowledge they cannot live without income redistribution from so-called “liberal” states. If they don’t want the money, then we’d be happy to take it back and spend it on our own welfare.

    “Publius,” you are as inane as usual. Why do you bother coming here?

  7. Jack Mitchell Says:

    I’d like to affirm and embellish Greg’s point. Appropriation of funding is a function of seniority in the Senate and House.

    The Senate is a special beast. And Greg’s assertion hinges on this, that a Senator who was elected by less people than lives in Middlesex county, gets the same slice of pork as a Senator from NY or CA. Our Founders deemed this wise and I will concur. It is unfortunate that such states are contributing less, that they are basically freeloaders. It would pain me, and Lynne I presume, that they weren’t so damn bratty about it.

    The House is no better. Effectively, politicians in the safest seats wield the most influence. Thus, we get the most extreme partisans in leadership. As the majority of the House flip-flops, the pendulum swings wildly. If the voters intended to express a call for moderation, nationally this midterm; they got no such thing. In the House, those Reps that hail from swing district, are habitually scoured from Congress. The net effect is that politicians inclined to collaborate, with the skills to collaborate, are washed away in election tides, time and time again.

    What you get is partisan leadership, with no inclination to barter, rising to to top and hunkering down.

  8. joe from Lowell Says:

    To extend yout thesis to the logical extent, as an advocate for government spending, you must pay the higher Massachusetts income tax rate.

    We do.

    It is best to lead by example.

    We do; by paying those higher state tax rates, we blue-staters are leading by example.

  9. waittilnextyr Says:

    I think he means the optional 5.95% MA tax rate. He would love it if you paid more into MA to help him out.

  10. Ryan Says:

    I would be more than happy to see the federal government pass a law that let states ‘opt out’ of paying federal taxes….. if they also ‘opted out’ from receiving federal benefits, up to and including military bases. The crazy red states may pull out, dragged kicking and screaming by their base, and the blue states win… or the blue states pull out and are able to much better address their own problems. California probably wouldn’t be having the problems its having, for example, if they didn’t pay out so much more than they get back.

  11. Lynne Says:

    Well CA has some very special problems of its own (the 3/4s or whatever number majority it takes to pass a budget) but point taken.

  12. C R Krieger Says:

    “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

    A couple of States tried the opt-out thing once and some darn’d Republican got all huffy and went to war over it.

    Regards  —  Cliff

  13. Lynne Says:

    I’m just saying, stop being hypocrites (to the red stater tea partiers and their leaders who exploit their lack of knowledge of reality). LOL

  14. Paul@01852 Says:

    @Cliff–Nuh uh!!! It was the South Carolinians who decided to shell Ft. Sumter when just a few more days of patience would have forced the abandonment of the fort due to incipient starvation. IMHO this was the most serious mistake the South made during the entire war at least up the point when a general named Lee ordered a subordinate general named Pickett to commit relative suicide across an almost one mile wide open field at a little Pennsylvania town called Gettysburg!

  15. K-R-S Says:

    End Point - Hypocrisy goes both ways - Hence the Tea Party’s (fundamental) bitch.

  16. joe from Lowell Says:

    I’ll voluntarily pay more taxes for public services when, say, Jeff Jacoby agrees to:

    - stay off of any newly-paved road for 30 days after the top coat goes on.

    - count to twenty (one-one-thousand, two-one-thousand) before calling 911 during any medical or other emergency, including fire.

    - wear sunglasses after sunset on any street with streetlights.

    Deal?

  17. Shawn Says:

    Yeah Publius, how dare you come on here and challenge the left’s superiority???

    Oh, and Lynne..

    Merry Christmas

  18. Lynne Says:

    He’s a known PITA, and honestly, I won’t waste my time with such.

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