Red State Vs. Blue: The Battle to end all battles!

[FunkyTown]

So while discussing the current US budget crisis(And there clearly is a budget crisis caused by the government), I went in to find out how much the federal government was given in terms of taxes from various states, as well as how much it has given out. I discovered the following:

The top five states for federal revenue for 2007 are:

State: Federal Tax: Traditional Political Association:

1: California $313,998,874,000 Democrat(Disputed)

2: New York $244,672,914,000 Democrat

3: Texas $225,390,904,000 Republican

4: Florida $136,476,423,000 Republican

5: Illinois $135,458,089,000 Democrat

However, we should also compare that list with the amount per capita, since obviously New York and California are very populous.

The top five per Capita in Federal Revenue are:

1: District of Columbia $34, 665.63/person Democrat

2: Delaware $19, 493.95 Democrat

3: Connecticut $15, 485.74 Democrat

4: Minnesota $15, 141.03 Democrat

5: New Jersey $14,008.70 Democrat

While those States that contributed the least to Federal taxation per capita were:

1: West Virginia $3,599.24 Republican(Disputed, swing state)

2: Mississippi $3,723.71 Republican

3: New Mexico $4,236.81 Democrat

4: South Carolina $4,650.82 Republican

5: Montana $4,721.65 Republican

This, however, is not quite an accurate picture. In order for this to be an accurate picture, we need to figure out who received the most aid from the government in this time. Obviously, those states that are most averse to taxes should be the most averse to receiving aid as well. It's unfair, after all, to expect other people to pay for you when you don't put money in.

Top five states receiving funds per capita, as per the US Census website are:

1: Wyoming Somewhere above $3500 Republican

2: Alaska Somewhere above $3500 Republican

3: Louisiana Somewhere above $3000 Republican(Disputed)

4: Mississippi Somewhere above $2500 Republican

5: Vermont Around $2500 Democrat

Sadly, the US census didn't provide exact numbers on this as per http://www.census.gov/prod/2008pubs/fas-07.pdf

Just generalized costs. This seems to be showing something, but to toss this on its ear, I'd also like to point out the following:

The 5 states receiving the least amount of federal aid per capita:

1: Nevada Somewhere below $1000 Democrat(Disputed)

2: Virginia Somewhere below $1000 Republican(Disputed)

3: Colorado Around $1000 Republican(Disputed)

4: Utah Somewhere above $1000 The most Republican State in the Union.

5: Georgia Somewhere above $1000 Republican

This paints an interesting picture:

A) Democratic states provide the most money per capita to the federal government.

B) Republicans receive the most money per capita from the federal government.

C) Swing states tend to be on the low end for receiving federal monies.

So, based on this, there is an interesting point that should be made: Should States have to balance their budgets exactly, receiving only what aid from the federal government they are willing to put forth(Barring emergencies, such as Katrina and September 11th style emergencies)?

Do you think that Democratic policies tend to create a more 'average' playing field while Republican policies tend to allow much greater wealth creation at the risk of much greater difficulties for those who falter and fall?

[bytor2112]

Um, District of Columbia is not a state. Florida went for Obama last election, Minnesota has a Republican Governor, California has a Republican Governor, Virginia voted Obama last election and has a Democrat Governor and so did Colorado which has a Democrat Governor. Mississippi, Louisianna and West Virginia are the poorest states and Connecticut has the highest income per capita. Montana and New Mexico rank among the poorest states as well. (poor meaning income)

Point is.....red state/ blue state is baloney. No state is 100% red or blue. All states have a mix of both and some independents....they may lean one way or the other, but they don't all fit neatly into either of those boxes. But if we want to look at taxes and big government as a gauge for effective government.......just look at the mess California is in or New Jersey or Michigan.

Edited August 3, 2009 by bytor2112

[dazed-and-confused]

FT, i am SO out of my league, here, but i will, nevertheless, through in my 2 cents.

I do believe that republicans CAN be greater risk takers and somewhat vulnerable to disater. This is my own uninformed opinion, thats all.

I also believe that in each party, or economic theory (dems, reps), that there are those who break out of the respective mold they are associated with.

AT what point does bigger and better become too big and a drain on others?

Am i right in thinking that if the gov't lets the auto industry fall apart, or some other major industry, according to a succeed or fail approach (american motors),the resulting unemployment would create a depression that would devistate our economy and threaten our security?

How about something smaller, like the tobacco industry?

Is there a line that can be drawn to tell us when a company gets too big and then, in effect, needs to be saved by my tax dollars or else the country is at risk?

[FunkyTown]

Um, District of Columbia is not a state. Florida went for Obama last election, Minnesota has a Republican Governor, California has a Republican Governor, Virginia voted Obama last election and has a Democrat Governor and so did Colorado which has a Democrat Governor. Mississippi, Louisianna and West Virginia are the poorest states and Connecticut has the highest income per capita. Montana and New Mexico rank among the poorest states as well. (poor meaning income)

Point is.....red state/ blue state is baloney. No state is 100% red or blue. All states have a mix of both and some independents....they may lean one way or the other, but they don't all fit neatly into either of those boxes. But if we want to look at taxes and big government as a gauge for effective government.......just look at the mess California is in or New Jersey or Michigan.

Fair point about the Red State/Blue State point, Bytor.

However, I decided on which state was which according to how they traditionally voted post 1955. If the overwhelming majority voted one way, I placed it as Democrat or Republican. If it was close, I counted 'em up and placed it as 'Disputed'.

However, I do think it's not something we can safely discount simply based upon how poor an area is. If traditional Republican values will increase trade, then those places should not be the most poor as those places that traditionally encourage Republican ideals should obviously attain the fruits of Republicanism.

Also, I should point out that I placed District of Columbia on the list simply because, though a small area, it's still significantly prosperous. I didn't place Puerto Rico on the list because that would skew results, since it isn't part of traditional US areas.

I should also point out that California's debt would be eliminated if they were not required to pay for other states. If they could simply cut back on Federal Taxes, they would be just fine in terms of budget.

Edited August 3, 2009 by FunkyTown

[Just_A_Guy]

So, based on this, there is an interesting point that should be made: Should States have to balance their budgets exactly, receiving only what aid from the federal government they are willing to put forth(Barring emergencies, such as Katrina and September 11th style emergencies)?

This is pretty much the result you'd get if the Federal government began turning many of its functions back over to the individual states. On the whole--barring emergencies, as you say--I think it's an appropriate result.

Do you think that Democratic policies tend to create a more 'average' playing field while Republican policies tend to allow much greater wealth creation at the risk of much greater difficulties for those who falter and fall?

Of course. Isn't the key aim of socialism to make sure that everyone is equally miserable?

Seriously--I think most Republicans don't have a problem with government's providing some sort of safety net. The issue is, to use the old analogy, making sure that the net does not become as comfortable as a hammock.

Edited August 3, 2009 by Just_A_Guy

[puf_the_majic_dragon]

Question. Why are we paying federal tax just to have it turned around and given back to the states? It's like paying your dad rent, then asking him to borrow some money to make your car payment. Except you don't live with your dad, he just charges you rent for the heck of it. Have I pretty well summed it up?

Cancel federal income tax. Increase state taxes. States pay a federal tax per capita. States receive no federal aid (except in emergencies ie Katrina).

Sounds good to me. Then again, I wouldn't be opposed to reincorporating the Articles of Confederation into the Constitution.

Oh, and as far as red vs blue - studies show that blue tends to interpreted by people as a more passive, soothing color while red tends to be aggressive and dangerous. Hence why the most popular color for the walls/stalls in public bathrooms is blue while the most popular color for sports cars is red.

[FunkyTown]

Actually, I would agree pretty much with everything you're saying, Puf. I think eliminating Income Tax to incorporate a flat-tax by state would be an interesting way of doing things.

I would be concerned, however, about how taxation would read. Should wealthier states pay more per person than poor states? If not, their taxes would actually be lower as they would purchase and spend more at a higher rate. This would cause the debt to the Federal government to be paid off quicker, which would mean that taxes could be lowered.

The flip side is: If Every state had to pay a flat(say) $5000 per capita, poorer states would have to raise taxes to pay off the flat person tax, since spending is less in poorer states. This would also place the burden of cost for infrastructure solely on those poorer states, which would encourage people to move to wealthier states where taxation is lower. As people left, taxes would have to be raised further until infrastructure spending became nearly non-existent due to lack of population.

This would raise costs for real estate in the wealthier places, which would force certain people out of the running for living there, forcing the poor back in to highly taxed areas.

This is assuming a perfectly informed and malleable populace, of course, which is not the case: Living in Canada, Most didn't relocate to Alberta just because the sales tax was 0% and income tax was almost nothing, even though jobs were soaring in the area. I did, but I can honestly say most of my friends and family didn't.

Question. Why are we paying federal tax just to have it turned around and given back to the states? It's like paying your dad rent, then asking him to borrow some money to make your car payment. Except you don't live with your dad, he just charges you rent for the heck of it. Have I pretty well summed it up?

Cancel federal income tax. Increase state taxes. States pay a federal tax per capita. States receive no federal aid (except in emergencies ie Katrina).

Sounds good to me. Then again, I wouldn't be opposed to reincorporating the Articles of Confederation into the Constitution.

Oh, and as far as red vs blue - studies show that blue tends to interpreted by people as a more passive, soothing color while red tends to be aggressive and dangerous. Hence why the most popular color for the walls/stalls in public bathrooms is blue while the most popular color for sports cars is red.

[puf_the_majic_dragon]

I had an idea I discussed with my roommate a while back about linking tax rates to property values - higher property values pay a higher tax. I'm still not sure I understand completely what he was talking about, but my roommate said it would lead to a similar problem - the lower income rural areas supporting the infrastructure.

In any case - a state/municipal level flat tax based on income (ie everybody pays 10% regardless of how rich or poor) would be fine by me. If the federal government taxes the states - a flat tax based on the state's income (ie 10% of what the state brings in from taxes) could work satisfactorily well. If it were not going to be flat, I'd make the tax rate follow a parabolic curve based off a simple quadratic equation.

[Moksha]

Utah has lost out on some federal funds because they were not willing to put up their 10% match, such as this years when they chose not to provide this match for dental and vision care for the disabled and elderly.