Using numbers to score a political pointPosted: August 14, 2010
There are many things that annoy me when it comes to politicians. This is one of them. Big Government looks at the debt of each state and draws some political conclusions from it. Devore writes,
This study is useful, if depressing, as America comes to grips with the alarmingly higher federal debt levels being incurred by President Obama and his Democratic allies in Congress. Useful, because it shows the linkage between voters accustomed to getting something for nothing by sending their bill for their high-spending ways to their children and grandchildren. The study’s depressing side: generationally selfish voters won’t easily change their voting habits.
Below are the graphics Devore presents:
Well, maybe, but looking at debt ignores the other side of the ledger and can have some misleading results. Afterall, if Bill Gates has a debt load of one billion dollars, does this make him less responsible than a fireman who has a debt load of one million dollars? Its all relative. So I looked at the revenue each state brings in and the picture is much murkier than Devore is suggesting.
Here is a ranking of states by revenue (source here). Click the picture to enlarge.
It looks like blue states make more money and may be able to afford a higher debt load, but revenue isn’t everything. So below is a ranking of each state by per capita debt to per capita revenue and you get the following. Click the picture to enlarge.
This contributes to Devores political point that blue states are high borrowers and burdening their future generations with debt. For Connecticut, on a per capita basis, their debt takes up 87% of their revenue. This seems high by comparison. For Alaska for example, this percentage is only 10%. Is Alaska more responsible with their money than Connecticut? Maybe, maybe not.
Where do these folks get their money? If your friend claims some moral superiority because he has no debt, paid off house, car and a high paying job, but then doesn’t reveal that his parents paid for it all, including his monthly stipend that finances his drug habit, does this person seem more responsible than someone who has debt because s/he has a mortgage, a modest job, a car payment and kids in college? Maybe, maybe not. Who knows. This prompted me to look at what extent these states have their hands in the till and getting money from taxes. Below is a ranking of states by the ratio of the amount of money they pay out in taxes and the amount of money they get back in federal funding. Below is that ranking. Click the picture to enlarge (Source here).
So while the blue states have high debt, it seems as though the primary beneficiaries of blue state production are red states. Looking again at Alaska, they get 1.84 dollars back for every dollar they pay out in taxes. They have huge subsidies being paid out to them, financed by the other states. Looking again at Connecticut, they get back 69 cents from the federal government for every dollar they pay out in taxes. Who is more responsible? Well, who knows again. There is certainly more to this than revenue, debt and federal outlays. The point is, Big Government and Devore are trying to mislead you into believing that Republicans hold some moral superiority to Democrats because they have higher per capita debt. Is this true? Not likely.
(note: the revenue numbers are from 2004)