State Federal Spending versus Federal Taxes – Did your State Gain or Lose?

September 2, 2012 – – State Federal Spending versus Federal Taxes – Did Your State Gain or Lose: Some American States receive more in federal spending than they pay in federal taxes; others receive less. Over twenty years these fiscal transfers can add up to a sizeable sum. For example, from 1990 to 2009 (the latest years available), the federal government spent $1.44 trillion in Virginia but collected less than $850 billion in taxes, a gap of over $590 billion. However, relative to the size of its economy, Virginia derived a smaller benefit from America’s fiscal union than states like New Mexico, Mississippi and West Virginia, where the 20 year transfer exceeded 200% of their annual GDP (Gross Domestic Product). Transfers to Puerto Rico, which is a US territory not a fully incorporated state, exceeded 290%. Federal transfer payments to states consist of, Social Security, Medicare, Welfare, Unemployment Assistance, etc. In the Virginia example; the State paid $848B in taxes to the Federal Government and received transfer payments of 1,441B ($1.44T). Taxes minus spending were -$593B. Virginia GDP was $ 410B. Therefore, taxes minus spending as a percent of GDP were -145%. The top three winners, shown in dark green; were Delaware (+206%), Minnesota (+199%) and New Jersey (+150%). The bottom four, shown in red; were West Virginia (-241%), Mississippi (-254%), New Mexico (-261%) and Puerto Rico (-291%). These calculations are based on tax figures provided by the Internal Revenue Service and federal spending numbers provided by the Census Bureau. The chart above reflects the winners and losers. How did your State do?

The Master of Disaster

About wfoster2011

Disaster researcher and current financial and economic news and events: Accidents, economics, financial, news, nature, volcanoes, floods, earthquakes, fires; airplane, ship & train wrecks; tornadoes, mine cave-ins, hurricanes, pestilence, blizzards, storms, tzuami's, explosions, pollution, famine; heat & cold waves; nuclear accidents, drought, stampedes and general. Futures trader using high volume and open interest futures markets. Also, a financial, weather and mundane astrologer with over 30 years of experience. Three University degrees from California State University Northridge: BS - Accounting MS - Busines Administration BA - Psychology Served in the U. S. Army as an Armored Platoon Leader in the 5th Battalion, 68th Armored Regiment, 8th Infantry Division (Retired). Have published three books and 36 articles available for sale through my blog: Commodology - Secret of Soyobeans (Financial Astrology) Timing is the Key (Financial Astrology) Scum City, a fiction novel (no longer available, under contract to major publisher) Currently resident of Las Vegas, NV, USA
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2 Responses to State Federal Spending versus Federal Taxes – Did your State Gain or Lose?

  1. Jason Mailer says:

    I believe you have FLIPPED your #s.

    If VA took in 1.4 T from Fed but only paid in .9 T, then it received .5 T ( POSITIVE ) more than it sent in. This is not a deficit.

    In GDP terms for VA, But this seems to be over 20 Years time. So it received about $1.5 for every dollar it put in. Nice return on investment …. pays to sit close to DC.

    • wfoster2011 says:

      You are looking at it from the wrong perspective. From the Federal level, which is what this article is about, the U.S. Government spent more in VA than it took in; therefore a deficit (expenses exceed income). Taxes – spending / State GDP = -593B/410B = 1.446 = -145% ; therefore VA is colored light red – in the 25 to 145 category.
      WGF
      AKA: The Master of Disaster
      (one of my degrees is in Accounting/Finance)

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