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New Yorkers send billions of dollars to Kentucky and other states every year; Mitch McConnell isn’t satisfied

Originally published on politicsandstuff.com

Where is Pat Moynihan when you need him?

Unfortunately the late Senator from New York is no longer with us. We could use his forceful advocacy.

Senator Moynihan, during his 24 years in office, made it a habit of reporting on a “balance of payments deficit” between and among the federal government and the states. He would annually compare the amount of money collected from New York residents and businesses in various taxes with the amount of federal money paid to New York State residents, its localities and school districts.

The taxes sent to Washington from New Yorkers always dwarfed the amounts sent back to New York by the federal government. Kentucky and a number of other states were on the receiving end of our money.  The pattern was consistent over the years.

Moynihan left office in 2000 and passed away in 2003. But the data is still there, and given Republican Senate Leader Mitch McConnell’s call for the states to go bankrupt, a suggestion he backtracked on when it was pointed out to him that such action was illegal, it is time to revive the data.

State Comptroller Tom DiNapoli’s office has prepared information on the exchange of money between the states and the federal government. The latest information is from 2017.

Here are some of the highlights from DiNapoli’s report:

  • “Federal spending in New York State during Federal Fiscal Year 2017 included approximately $57 billion in Social Security payments, $48 billion for Medicare, and $54 billion for Medicaid and other safety net grants. Billions of dollars in other expenditures supported key programs in areas such as transportation, education and veterans benefits.
  • “Meanwhile, individuals and businesses in the State generated almost $250 billion in federal taxes.
  • “The bottom line: New York sent an estimated $24.1 billion more in tax payments to Washington than it received in federal spending.
  • “For every federal tax dollar generated in New York, the federal government returned 90 cents to the State. That was significantly less than the $1.19 average return nationwide. On a per capita basis, only three states—New Jersey, Massachusetts and Connecticut—experienced a more negative balance of payments than New York.
  • “In some areas of the federal budget, the State fared comparatively well. New York, with 6.1 percent of the nation’s population, received higher percentages of federal spending for Medicaid, Supplemental Nutrition Assistance and certain other safety net programs, for example.
  • “On the other hand, the State generated 8.0 percent of the federal government’s tax receipts, including 8.8 percent of income tax payments. Those percentages were higher than our shares of nationwide population and personal income.”

Drilling down a little further in DiNapoli’s report, you can see that New York State’s net contribution approximately equals the combined net handouts received by ten other states: Alaska, Colorado, Iowa, Kansas, Montana, Nevada, North Dakota, South Dakota, Vermont, and Washington, plus, for good measure, half of Delaware’s federal funding.

McConnell’s home state of Kentucky received $26.652 billion more in federal expenditures than that state’s residents and businesses paid in federal taxes. In other words, New York’s net payments to the federal government nearly matched all the excess federal funding that Kentucky took in.

Of the fifty states, 40 of them received more in federal expenditures than the amounts they sent to Washington.

And since the country is so divided politically, here’s how the total federal expenditures to the states carried by Donald Trump in 2016 compared with the expenditures to the states carried by Hillary Clinton:

  • Of the 30 states carried by Trump, all but two received more than they sent to Washington.
  • The total positive receipts by those 30 states just in federal fiscal 2017 were $516.7 billion (more than one half trillion dollars).
  • Of the 20 states carried by Clinton, fourteen of them were net contributors to the handout states.
  • Collectively the 20 Clinton states provided $48.9 billion to the other 30 states.
  • In other words, the blue states provided the red states with food, shelter and income.

In gratitude for the dole received by Mitch McConnell’s state and others, he suggested that the states be allowed to go bankrupt. That would probably dry up the dole that McConnell’s favored red states receive.   McConnell’s biting-the-hand-that-feeds you approach would substantially hurt the people he represents.  You’re welcome Kentucky.


Ken Kruly writes about politics and other stuff at politicsandstuff.com.

Written by Ken Kruly

Ken Kruly

Ken has been a very active community participant in the world of politics for nearly 50 years. Everything from envelope stuffing to campaign management. From the local council level to presidential campaigns. On the Democratic side. A whole lot of politicians worked for, fought against, had a beer with. Now, "mostly" retired, Ken continues to have a great interest in government and politics on the local, state and federal levels. His blog, politicsandstuff.com provides weekly commentary and opinions about policy, budgeting, candidacies, and analysis of public issues. 

View All Articles by Ken Kruly
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