Six Blue States Subsidize 99.98% of the Deficits of 42 States and the District of Columbia.
We can explore which Blue States subsidize which of the remaining states and the District of Columbia by examining the Rockefeller Institute of Government’s report (dated 22 Jan. 2020, retrieved 2020.09.03), based on 2018 data, that examines the Balance of Payment’s for each state (dated 22 Jan. 2020, retrieved 2020.09.03).
We will find that six Blue States (NY, NJ, MA, CT, CO, MN) subsidize essentially all of the deficits of the remaining 44 states and DC. Those six pay a total of 99.98% of all the moneys subsidizing the deficits of the remaining states and DC.
Figure 1a is a graphical summary of the Blue vs. Red status of each state and DC over the last four presidential elections, 2004–2016. Figure 1b is its legend.
We may take the red and pink states, states that voted Republican in at least three of the four elections, as traditionally Red States. The
blue and light-blue states, states that voted Democratic in at least three of the four elections, we may take as traditionally Blue States.
There are 23 traditionally Blue States (HI, WA, OR, CA, NV, CO, NM, MN, WI, IL, MI, VA, MD, DE, PA, NJ, NY, CT, RI, MA, VT, NH, ME) and DC.
There are 24 traditionally Red States (AK, ID, MT, WY, UT, AZ, ND, SD, NB, KS, OK, TX, MO, AR, LA, IN, KY, TN, MS, AL, GA, SC, NC, WV). In addition, there are the three states (IA, OH, and FL) that voted Democratic in two of the four elections and Republican in two.
Funds from the states are paid into federal government coffers (e.g. income taxes from people in the states), and funds from federal coffers are paid out to the states (e.g. Medicare, Medicaid, Food Stamps, infrastructure-structure-support funds, etc.)
A state’s Balance of Payments is defined as the difference between the funds paid out by the federal government less the funds paid into the federal coffers by that state. Negative BoPs indicate states that received less money in benefits than they paid in. Positive BoPs indicate states that received more in federal funds than they paid in. Thus, negative BoP states subsidize the deficits of positive BoP states.
Figures 2a and 2b comprise a chart of the 50 states organized by increasing Balance-of-Payments (in Millions). A blue line underscoring the state’s name indicates a traditionally Blue State. A red line indicates a traditionally Red State.
If one enlarges Figure 3a (select Right Click > View Image), one will readily see that of the eight states having negative BoPs (NY, NJ, MA, CT, CO, MN, UT, NB),
that is states that receive less than they pay and therefor subsidize all the other states, six are Blue States (NY (-$22Bn), NJ (-$11.1Bn), MA (-$9.1), CT(-$8.1Bn), CO (-$1.6Bn), MN (-$0.7Bn)), and just two are Red States (UT (-$0.5Bn), NB (-$0.3Bn)).
If one enlarges Figure 3b, one will readily see that of the 15 states with positive BoPs, that is receive more than they pay in, in excess of $20Bn, 10 are Red States ( GA (+$20Bn), LA (+$20.2Bn), SC (+$23Bn), FL (+$24Bn), MO (+$26Bn), ) TN (+$25.3Bn), AZ (+$26.4Bn), NC(+$33Bn), AL (+$33Bn), KY (+$45.2Bn) ). and just four are Blue States (MI (+$24Bn), PA (+$33B), MD (+$48Bn VA (+$97Bn)). One, OH (+$34.6BN), is one of the three that voted Blue in two elections and Red in two.
Of the 35 remaining states, 17 are Red, 16 are Blue, and 2 are states that voted Red in two elections and Blue in two.
In summary, we have seen that of the 50 states and DC, just eight subsidize the deficits of the remaining 43. Six of the eight are Blue States; only two are Red States. The combined subsidies of those two are just $0.8Bn out of a total of $52.5Bn, or 0.02%. Stated alternately, six Blue States pay 98.98% of all the moneys subsidizing the deficits of 42 states and DC.
Blue States: $/capita federal taxes paid
$15,643 CT
$13,582 MA
$13,137 NJ
$12,820 NY
$10,510 CA
Red States: $/capita federal taxes paid
$06,665 SC
$06,626 KY
$06,349 WV
$05,740 MI
