Demographics
A few years ago - about 4, IIRC - a friend, looking at the new USA Today map, asked me how it could be that the election was so close, but that most of the country appeared to be for Bush. Because I had looked up some figures even earlier than that, the answer was obvious to me: density. I knew, for example, that approximately 1/4 of the population lives in the 13 or so largest cities, and 1/2 live in about the top 25-30 urban centers. It's for this reason that the abolition of the electoral college would mean that presidential candidates would never leave the coasts except to visit Chicago, Phoenix, and Dallas. I'm sure I'm not the only one who saw it, but there are those who dispute it.
At that time, Paul Krugman reportedly wrote a piece claiming that the Blue states support the Red States (sorry, no link, probably in the NYT). At the time, I assumed it was true and took no further interest in it because it fit neatly with something I have been pointing out to racists for years: most welfare recipients are white. They always counter with the claim that black welfare recipients are more common than black citizens are in the US as a percentage. Perhaps, but the bill that the federal government sends me is based on the total number of welfare recipients, not the portion that is black or white. Total Number. Caucasions contribute far more to that number than other races. The problem with welfare isn't the color of the people receiving it, it's that there is a need - real or perceived - in the first place.
Okay, well, the "Blue State Subsidy" claim has arisen again, and this time I decided to check it out (original source here). Again, I don't dispute it, but there's something in those patterns that has me curious. Now, I couldn't use their sources (the Tax Foundation's "State-by-state tax burden model"), but I could use the Statistical Abstract for state-by-state spending and the IRS for state-by-state tax stats for 2003. My results were similar, though the actual numerical results of money received to taxes paid ratios were different.
I found two interesting results: one, that taxes paid and benefits received track right along with population (see figure), and two, the total amount of benefits spent in the "net donor" Blue states listed in the links above (New Jersey, Connecticut, Illinois, Minnesota, Massachusetts, California, and New York) are far more than than what is spent in the "net recipient" Red states (North Dakota, Mississippi, Alaska, West Virginia, Montana, Alabama, South Dakota, and Arkansas, and I would add New Mexico since it went Red this time around).
The five most populous Blue states (CA, NY, IL, PA, MI) paid 33.5% of the total taxes paid, and only received 29% of the benefits doled out from Washington. The five largest Red States (TX, FL, OH, GA, NC) paid out 22% of the total taxes paid and received only 21% of the benefits. Yes, they paid more than they received. If you expand to the Top 10 largest (includes NJ, MA, WA, MD, WI), the corresponding numbers are 45% paid and 39% received for the Blue States and 31% paid and 32.8% received for the Red States (include VI, IN, TN, MO, AZ). They are starting to receive more than they paid in. But add it up: the 20 most populous states are paying 76% of the taxes and receiving about 72% of the benefits. That leaves only about 1/4 of the federal budget to be divided among the other 30 states, most of which are Red. There were only 20 states and Washington DC that went Blue, leaving 30 states that went Red. All of the Blue states and Washington paid 56% of the tax burden and receive 48% of the largesse. All of the Red states paid 44% of the tax burden and receive 52% of the largesse. Amazingly close to the vote totals, no? While I think it's a coincidence that probably surfaces in any figures that are close to being evenly split, it is well known that incumbent parties have been using discretionary spending to buy votes.
Let me put that another way: between California and New York, they receive $335 B that gets distributed among 54 million people. You have to add up Wyoming, both Dakotas, Alsaka, Montana, Idaho, Nebraska, W. Virginia, New Mexico, Nevada, Utah, Arkansas, Kansas, Mississippi, Iowa, Oklahoma, Kentucky, S. Carolina, Louisiana, and Alabama before you get to $324 B (adding Colorado bumps it over $350 B), and you have to add the populations of those states to get 51 M (plus Arizona to get to 56.5).
Two more points: What about looking at this in terms of paying/spending per capita? And what is the correspondence of high income earners and population density?
To answer the first question, I took my results and divided by the population of each state (and DC). For the Top 5, Red Staters paid out $6342 per person and received $5894 per person. Blue Staters paid out $7280 per person but received only $6143 per person. They paid more per person, but also received more. As you go to less populated states, Blue staters pay more, but continue receiving roughly the same per person, while Red staters gradually pay less per person and receive more. When you include every state one but DC, Red states are receiving about $6540/person, slightly more than $6522 per person received in Blue states.
The Red states pay more per person than the Blue states ($5740 vs. $7710). My conjecture is that this has to do with the relative costs of living in those places (you gotta have a much higher paying job to afford to live in NYC than you do to live upstate, where the counties went red, and people who are paid more pay more in taxes) and with the distribution of really wealthy people. It is well known that - even after the "tax cuts for the wealthy - the richest 1% pay about 33% of the total tax bill, and the wealthiest 10% pay about 67% of the total tax bill. In other words, I am suggesting that the real reason for the Blue/Red subsidization is that the real party of the wealthy is the Democratic Party. Research in The Economist apparently supports this hypothesis: they found that people worth between $1 M and $10 M went for Bush 63-37, but people worth more than $10 M went for Kerry 59-41. Hmmm ... party of Working Class, indeed.
Bottom Line: You Blue Staters are overstating the amount of subsidization you are forced to do. Most of that money is coming right back to you, and the rest is divided among dozens of states mostly by population, so dividing federal spending by statewide taxation overstates the amount of money going to, say, Alaska or New Mexico. Besides, you keep voting for politicians who run on a redistribution platform, so these are the chickens coming home to roost. And for you Red Staters: you are being subsidized, whether you like it or not. Studies show that people believe that all Congressman but their own belly up to the pork barrel. Well, guess what? Yours does it, too, and you need to be aware of it the next time you have a chance to vote.
At that time, Paul Krugman reportedly wrote a piece claiming that the Blue states support the Red States (sorry, no link, probably in the NYT). At the time, I assumed it was true and took no further interest in it because it fit neatly with something I have been pointing out to racists for years: most welfare recipients are white. They always counter with the claim that black welfare recipients are more common than black citizens are in the US as a percentage. Perhaps, but the bill that the federal government sends me is based on the total number of welfare recipients, not the portion that is black or white. Total Number. Caucasions contribute far more to that number than other races. The problem with welfare isn't the color of the people receiving it, it's that there is a need - real or perceived - in the first place.
Okay, well, the "Blue State Subsidy" claim has arisen again, and this time I decided to check it out (original source here). Again, I don't dispute it, but there's something in those patterns that has me curious. Now, I couldn't use their sources (the Tax Foundation's "State-by-state tax burden model"), but I could use the Statistical Abstract for state-by-state spending and the IRS for state-by-state tax stats for 2003. My results were similar, though the actual numerical results of money received to taxes paid ratios were different.
I found two interesting results: one, that taxes paid and benefits received track right along with population (see figure), and two, the total amount of benefits spent in the "net donor" Blue states listed in the links above (New Jersey, Connecticut, Illinois, Minnesota, Massachusetts, California, and New York) are far more than than what is spent in the "net recipient" Red states (North Dakota, Mississippi, Alaska, West Virginia, Montana, Alabama, South Dakota, and Arkansas, and I would add New Mexico since it went Red this time around).
The five most populous Blue states (CA, NY, IL, PA, MI) paid 33.5% of the total taxes paid, and only received 29% of the benefits doled out from Washington. The five largest Red States (TX, FL, OH, GA, NC) paid out 22% of the total taxes paid and received only 21% of the benefits. Yes, they paid more than they received. If you expand to the Top 10 largest (includes NJ, MA, WA, MD, WI), the corresponding numbers are 45% paid and 39% received for the Blue States and 31% paid and 32.8% received for the Red States (include VI, IN, TN, MO, AZ). They are starting to receive more than they paid in. But add it up: the 20 most populous states are paying 76% of the taxes and receiving about 72% of the benefits. That leaves only about 1/4 of the federal budget to be divided among the other 30 states, most of which are Red. There were only 20 states and Washington DC that went Blue, leaving 30 states that went Red. All of the Blue states and Washington paid 56% of the tax burden and receive 48% of the largesse. All of the Red states paid 44% of the tax burden and receive 52% of the largesse. Amazingly close to the vote totals, no? While I think it's a coincidence that probably surfaces in any figures that are close to being evenly split, it is well known that incumbent parties have been using discretionary spending to buy votes.
Let me put that another way: between California and New York, they receive $335 B that gets distributed among 54 million people. You have to add up Wyoming, both Dakotas, Alsaka, Montana, Idaho, Nebraska, W. Virginia, New Mexico, Nevada, Utah, Arkansas, Kansas, Mississippi, Iowa, Oklahoma, Kentucky, S. Carolina, Louisiana, and Alabama before you get to $324 B (adding Colorado bumps it over $350 B), and you have to add the populations of those states to get 51 M (plus Arizona to get to 56.5).
Two more points: What about looking at this in terms of paying/spending per capita? And what is the correspondence of high income earners and population density?
To answer the first question, I took my results and divided by the population of each state (and DC). For the Top 5, Red Staters paid out $6342 per person and received $5894 per person. Blue Staters paid out $7280 per person but received only $6143 per person. They paid more per person, but also received more. As you go to less populated states, Blue staters pay more, but continue receiving roughly the same per person, while Red staters gradually pay less per person and receive more. When you include every state one but DC, Red states are receiving about $6540/person, slightly more than $6522 per person received in Blue states.
The Red states pay more per person than the Blue states ($5740 vs. $7710). My conjecture is that this has to do with the relative costs of living in those places (you gotta have a much higher paying job to afford to live in NYC than you do to live upstate, where the counties went red, and people who are paid more pay more in taxes) and with the distribution of really wealthy people. It is well known that - even after the "tax cuts for the wealthy - the richest 1% pay about 33% of the total tax bill, and the wealthiest 10% pay about 67% of the total tax bill. In other words, I am suggesting that the real reason for the Blue/Red subsidization is that the real party of the wealthy is the Democratic Party. Research in The Economist apparently supports this hypothesis: they found that people worth between $1 M and $10 M went for Bush 63-37, but people worth more than $10 M went for Kerry 59-41. Hmmm ... party of Working Class, indeed.
Bottom Line: You Blue Staters are overstating the amount of subsidization you are forced to do. Most of that money is coming right back to you, and the rest is divided among dozens of states mostly by population, so dividing federal spending by statewide taxation overstates the amount of money going to, say, Alaska or New Mexico. Besides, you keep voting for politicians who run on a redistribution platform, so these are the chickens coming home to roost. And for you Red Staters: you are being subsidized, whether you like it or not. Studies show that people believe that all Congressman but their own belly up to the pork barrel. Well, guess what? Yours does it, too, and you need to be aware of it the next time you have a chance to vote.
Labels: politics
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