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The National Association of State Budget Officers is a great repository of data on state revenues and expenditures. I think looking at state spending and state tax burdens is a nice way to contrast what happens in government as compared to the private sector. Many people (rightly) are bummed out that private sector wages have been flat for a decade. If this is the case, then you might reasonably expect that spending in the government sector would be flat, or at least adjusted so that they grow no faster than inflation and population. Here is the data, summarized for you:

So, state spending increased by 72% over the last decade while prices increased by 26.6% and the US population increased by 9.1%. In other words, state spending increased over twice as fast as it would have had to in order to deliver the same real quantity and quality of public goods to its citizens today as compared to in 2000. Let me ask a question just like the pols like to ask about the world we live in: is the quality and quantity of public goods you are receiving today from your state better than, the same, or worse than, you were getting 10 years ago? And what does your answer tell you about what the states have been spending their money on? And what does your answer tell you about the productivity and efficiency of the states?

Oh, and during this time period, the “average” person’s state tax burden has increased by over 40%. And that’s before we are going to have to deal with the coming public employee pension and health benefit tsunami. In case you were wondering, the states with their public employee retirement SH&T together are Idaho (with no unfunded liabilities) and the Carolinas, each with less than $500 per taxpayer in unfunded liabilities.

3 Responses to “State Spending, What is it Good For?”

  1. Harry says:

    I may be wrong by a few percent or two, but as the economy recovered from the Clinton recession, and tax revenue poured into the state treasury from supply-side tax cuts, our governor and legislature spent every dime and then some, and the state payroll bloated by thirty percent.

    Every body added was not just someone on the payroll, costing not just his salary and lavish fringe benefits, but also a huge obligation in post-retirement pension and health care benefits that lie hidden until the day they are activated. In addition, the state has borrowed over a billion dollars to purchase suburban land to improve the view of Swarthmore College graduates who prefer not to use their own money to buy a few acres from the stupid farmer across the street.

    Gambling was supposed to rescue us, just as it rescued New Jersey, or, before Wintercow was born, OTB was supposed to rescue New York.

    At every level of government we have way too many people sitting around spending too much time wasting other people’s money. Now, there’s a multiplier we can believe in.

  2. Harry says:

    Regarding any benefits, beside public order and roads I cannot think of any the state has bestowed on me, ever. The state has been an unremitting tax drain. I never expected the state to do anything for me, but it gets old when they show up with advice about how to better use whatever property is left.

  3. Sanket says:

    absolutely nothin, hey !

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