The Red State Paradox: Which States Rely Most on Federal Funding?

John Tierney highlights one of the “most interesting maps” from Wallet Hub:

“The Wallet Hub analysts essentially asked how much each state receives back as a return on its federal income-tax investment.  They compared the 50 states and the District of Columbia on three metrics: 1) federal spending per capita compared with every dollar paid in federal income taxes; 2) the percentage of a state’s annual revenue that comes from federal funding; and 3) the number of federal employees per capita.  The third measure received only half the weight of each of the others in the calculation.”

Mississippi and New Mexico top the list of “most dependent” states.

WalletHub

“It’s not just that some states are getting way more in return for their federal tax dollars, but the disproportionate amount of federal aid that some states receive allows them to keep their own taxes artificially low. That’s the argument Wallet Hub analysts make in their 2014 Report on Best & Worst States to be a Taxpayer.”

Also: The reddest states (Mississippi, Alabama, Louisiana, New Mexico, Maine) “have exceptionally high poverty rates and thus receive disproportionately large shares of federal dollars.”

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