Serious Implications

Republican Senators Lindsey Graham, John McCain and others are expressing outrage over what they claim is the unfair deal the Senate gave Nebraska to persuade Nebraska Senator Ben Nelson to vote for health care reform. Graham and McCain are making a silly and disingenuous argument given the long-standing inequality of federal aid to states.

The Tax Foundation publishes annual reports describing how much money states get per dollar of federal tax revenue each state sends to Washington. The Tax Foundation’s data for 2005, the most recent available, is found here.

Here’s how three of the states fare:

South Carolina (Graham’s state) $1.31 received from the federal government for every $1.00 they send to Washington.

Arizona (McCain’s state) $1.19 back for every $1.00 sent.

Nebraska (Ben Nelson’s state) $1.10 back for every $1.00 sent to Washington.

All three of the above states are subsidized by the federal government, but Graham and McCain’s states are more subsidized than Nelson’s Nebraska.

The range of unequal state reimbursements per $1.00 sent to Washington range from $2.03 for New Mexico to as low as $0.61 for New Jersey. “Red” states are generally much more subsidized compared to “Blue” states, as discussed here and here.

Do Graham and McCain really expect us to believe that unequal appropriations to states have nothing to do with making deals in Congress?

Silly boys.

The 22 states voting for McCain-Palin, on average, received $1.40 back for every dollar they sent to Washington; The 28 states for Obama-Biden, on average, received $1.00 for every dollar sent.

Source: 2004 Data compiled by the Tax Foundation

Ironically, those complaining loudest about federal taxes and spending tend to benefit the most. Notice the benefit-to-payment ratios for the home states of the major party presidential tickets:

Alaska (Palin) $1.87 received for every tax dollar paid (subsidized).
Arizona (McCain) $1.30 (subsidized).
Delaware (Biden) $0.79 (donor).
Illinois (Obama) $0.73 (donor).

Remember when Republicans attacked Obama for wanting to “spread the money around?” Like Blanche DuBois, McCain and Palin’s states depend on the kindness of strangers, Like Illinois, and Delaware, and Connecticut, and New York, and California, and Michigan, and New Jersey, and Minnesota, and all the other donor states on the short end of the stick. New Jersey gets a lousy 55-cents back for every dollar its sends to Washington.

The figures and 2008 voting results for all 50 states:

New Mexico $2.00 Obama-Biden
Alaska $1.87 McCain-Palin
West Virginia $1.83 McCain-Palin
Mississippi $1.77 McCain-Palin
North Dakota $1.73 McCain-Palin
Alabama $1.71 McCain-Palin
Virginia $1.66 Obama-Biden
Hawaii $1.60 Obama-Biden
Montana $1.58 McCain-Palin
South Dakota $1.49 McCain-Palin
Oklahoma $1.48 McCain-Palin
Arkansas $1.47 McCain-Palin
Kentucky $1.45 McCain-Palin
Louisiana $1.45 McCain-Palin
Maryland $1.44 Obama-Biden
Maine $1.40 Obama-Biden
South Carolina $1.38 McCain-Palin
Arizona $1.30 McCain-Palin
Tennessee $1.30 McCain-Palin
Missouri $1.29 McCain-Palin
Idaho $1.28 McCain-Palin
Utah $1.14 McCain-Palin
Kansas $1.12 McCain-Palin
Vermont $1.12 Obama-Biden
Wyoming $1.11 McCain-Palin
Iowa $1.11 Obama-Biden
North Carolina $1.10 Obama-Biden
Nebraska $1.07 McCain-Palin
Pennsylvania $1.06 Obama-Biden
Florida $1.02 Obama-Biden
Rhode Island $1.02 Obama-Biden
Ohio $1.01 Obama-Biden
Indiana $0.97 Obama-Biden
Oregon $0.97 Obama-Biden
Georgia $0.96 McCain-Palin
Texas $0.94 McCain-Palin
Washington $0.88 Obama-Biden
Michigan $0.85 Obama-Biden
Wisconsin $0.82 Obama-Biden
California $0.79 Obama-Biden
Colorado $0.79 Obama-Biden
Delaware $0.79 Obama-Biden
New York $0.79 Obama-Biden
Massachusetts $0.77 Obama-Biden
Illinois $0.73 Obama-Biden
Nevada $0.73 Obama-Biden
Minnesota $0.69 Obama-Biden
New Hampshire $0.67 Obama-Biden
Connecticut $0.66 Obama-Biden
New Jersey $0.55 Obama-Biden

This kind of unequal distribution of federal spending and taxation is likely justified, given the uneven economic conditions and opportunities around the United States. What is absurd and hypocritical, is having clear beneficiaries, including McCain and Palin, complaining about taxes and spending.

Of the 19 states won by John Kerry in 2004, 12 of them are “Donor States,” i.e., they send more tax dollars to Washington than they get back. Twenty-six of the 31 states won by Bush are “Tax Subsidized States,” meaning they get back more than they put in. New Jersey receives only $0.62 back for every tax dollar it sends to the Feds. North Dakota receives over $2.00 for every tax dollar it sends to Washington. Read more…