Paul L. Caron
Dean




Thursday, July 13, 2017

Ranking The States By Fiscal Condition

Mercatus Map

Mercatus Center, Ranking the States by Fiscal Condition (2017):

This paper contains four sections. Section 1 reviews the definitions, data, and methodology used to produce the ranking. Section 2 presents an analysis of how states have changed both in absolute terms and over time, highlighting the biggest changes between fiscal years 2014 and 2015. Section 3 provides an analysis of the top five and bottom five states. Section 4 concludes with key takeaways from the best- and worst-performing states and implications for the years to come.

https://taxprof.typepad.com/taxprof_blog/2017/07/ranking-the-states-by-fiscal-condition.html

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Comments

"BTW where do these top 20% reside...so I can go and thank them?"

Everywhere in America, but they're concentrated in CA, NY, FL, and around DC.

Other than Florida, those all score below average in state fiscal condition.

If you'd like to make a causal argument, then by all means, please provide some evidence!

Posted by: MM | Jul 17, 2017 7:30:22 AM

Thank you MM for pointing that out! BTW where do these top 20% reside...so I can go and thank them? Do I go to these rural states or somewhere else?

Posted by: Eddy from Accounting | Jul 17, 2017 7:13:47 AM

Wohoo, South Carolina!
http://www.postandcourier.com/news/earmarks-remain-slippery-slope-for-south-carolina-lawmakers/article_70ff5c7e-ad47-11e6-965d-bf7fb26903ff.html

Clearly the federal government building infrastructure does nothing for state finances. Because state governments never borrow money to build infrastructure on their own, and infrastructure never does anything to help the economy.

Posted by: Earmarks | Jul 16, 2017 7:48:11 PM

"The northeast and west coast have been supporting rural states financially for decades through taxes and transfer payments."

Deceptive and false. State governments have nothing do with with subsidizing other states. Taxpayers in the top 20% of households do that, via federal taxes they pay.

Posted by: MM | Jul 16, 2017 10:11:22 AM

These rural states have about 10 to 100 times as many senators per person as the larger states. It's not surprising that they use their political power to subsidize themselves at the expense of more populous states.

https://taxfoundation.org/which-states-rely-most-federal-aid-0/

Posted by: Federal subsidies | Jul 16, 2017 5:02:57 AM

The northeast and west coast have been supporting rural states financially for decades through taxes and transfer payments.

https://www.theatlantic.com/business/archive/2014/05/which-states-are-givers-and-which-are-takers/361668/

Poverty in the United States is heavily concentrated in the states Mercatus thinks are doing well, and would be a lot worse without the coastal states systematically bailing them out every year through taxes, transfer payments, and unnecessary military bases and bridges to nowhere.

Posted by: Federal subsidies | Jul 16, 2017 5:00:04 AM

Posted by: MM | Jul 15, 2017 3:50:54 PM

Um,
The answer is no, as any literate person can discern.

Posted by: Mike Petrik | Jul 14, 2017 9:03:16 AM

If you believe this chart, you probably also believe the ACA is collapsing. According to these rankings Alaska is rated as “above average.” Alaska currently is attempting to deal with a $2.9bb budget deficit, for a budget of $4.4bb. Going forward, Alaska relies on oil revenue for 90% of its state revenue stream, and has nearly exhausted its rainy day reserve. This is “above average” fiscal condition? Kansas is rated “average.” Nothing needs be said about that silliness. Wisconsin is reporting a growing $1.7bb deficit for 2017, which will be closed in part by tapping $450mm in reserve funds, which in turn are running out. Florida, ranked number 1 by Mercatus, has faced and continues to face a substantial structural budget deficit in the coming years. Florida has an aging population (really?) that is consuming and demanding more and more state resources. Meanwhile, California has a balanced budget and is paying INTO its rainy day funds, which this year will reach 66% of their constitutional target levels. Rated #43 by Mercatus–“below average.” Does any of this make sense? Perhaps the nature of the source of the chart may shed some light. Ah yes. The Mercatus Center was founded and is funded by the Koch Family Foundations. In addition to its Koch ties, it is also closely allied with the American Legislative Exchange Council (ALEC) and National Federation of Independent Business (NFIB). Not an argumentum ad hominum. Just saying.

Posted by: Publius Novus | Jul 14, 2017 6:30:34 AM

Seriously? Mississippi ranks higher than New York, New Jersey, Connecticut and Massachusetts?

Are we ranking states by their illiteracy and poverty rates? By how young their populations are when they die?

Posted by: Um | Jul 13, 2017 9:26:10 PM

Interesting to note, California and New York, in the top 4 states by population, and top 3 by GDP, recently started down the road of complete state-run health care. Estimates were than the cost would double the current state budgets.

How might that affect they're existing fiscal health, I wonder?

Posted by: MM | Jul 13, 2017 1:12:56 PM