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South Dakota Fourth Largest Red-State Moocher

Mr. Woodring updates us on South Dakota's red-state moocher status with a link to this map from the Tax Foundation showing the percentage of state budgets covered by federal aid:

Tax Foundation map: federal aid as percentage of state budgets, 2011
(click to enlarge!)

South Dakota depends more on Uncle Sam than 46 other states, paying only 54.4% of its own way. Only Arizona, Louisiana, and Mississippi get a larger share of their state budgets from federal funding.

North Dakota, with its growing oil revenues, has the lowest budget dependence on federal revenues in our neighborhood, covering 74% of its own revenues. But even without oil, Minnesota is able to foot just about 71% of its own bills.

Of the ten top dependents on federal spending, all but #10, New York, voted this year for the Republican Presidential nominee. of the ten states least dependent on federal dollars, all but two voted for the Democratic nominee.

As I responded to Dr. Blanchard last month, any bragging about South Dakota's fiscal responsibility must be tempered with an acknowledgement of our dependence on Washington's deficit spending and the generosity of other, mostly blue states.

34 Comments

  1. Dougal 2012.12.14

    Thank God that Thune and Noem are working hard to make South Dakotans less reliant on federal taxes!

  2. Bob Mercer 2012.12.14

    I looked at this the other day and wondered about the methodology. That's why I haven't used it yet. I did send it for further review by some folks and haven't heard back yet. The tricky part is state budgets vary in the methods and designations of funding.

    South Dakota's budget for the current fiscal year was set at general funds $1,215,68,778; federal funds $1,360,473,398; and other $758,176,919. The "other" category contains many things we probably would think are normal state operations, such as Game, Fish and Parks license revenues, DOT funding from the state fuel taxes, et cetera.

    I'm not sure about the numbers used for the calculations in the chart. But it is true that for the two previous fiscal years and the current fiscal, based on thumbnail numbers from the state government's annual budget books, South Dakota's overall spending by state government involved approximately 38 percent to 43 percent federal funds.

    This chart probably explains something about South Dakota politics. Voters tend to elect Republicans to governor and the Legislature to hold down state taxes, and until recently they tended to send Democrats to Congress, presumably to help bring back more federal revenue.

    (It is funny to see South Dakota described as a moocher by some of the same folks who are urging that state government take more federal aid. But that's another topic altogether. And if we expected consistency it wouldn't be politics!)

  3. Bill Fleming 2012.12.14

    Bob M., yes, it is funny. That's the point. It's not another topic altogether, it is THE topic. The Republican delusion of state self-reliance.

    (Man, Cory, these nuts are hard to crack, brother. We're talkin HARD! Amirite?)

  4. John 2012.12.14

    That, is the hypocrisy evident to all but the willfully blind - South Dakota is a leading federal welfare queen, a moocher, and an abdicator of local control that only feeds the whining cycle.

    "“If you believe in states’ rights and you believe in state control, why would you cede that control?” asked Robert Laszewski, a prominent insurance industry consultant.

    A longtime critic of the health-care law, Laszewski argues that Republican state leaders have allowed their ideological and political differences with President Obama to override pragmatic considerations, to the detriment of their residents.

    “There’s a lot of cut-off-your-nose-to-spite-your-face going on,” he said."
    http://www.washingtonpost.com/national/health-science/critics-blast-gop-state-lawmakers-for-giving-control-of-insurance-exchanges-to-federal-officials/2012/12/13/a638a4f8-452d-11e2-8061-253bccfc7532_story.html

  5. Jenny 2012.12.14

    I like it how Bob implies that it's Tim Johnson's fault on why SD is a leader on receiving federal funds.

  6. Steve O'Brien 2012.12.14

    Bob, I do see your point about the irony. However, deeper in that irony is what is really the difference in the funding discussion of this state and even this nation. On one side of the discussion there seems to be the conservatives who see spending as dollars - the spending of those dollars needs to be reduced. On the other side of the discussion are the liberals who see spending as services - those services are needed and should be expanded. It is a parallel discussion, but too often doesn't directly clash because of those two focuses on what spending "is." To the detriment of this state, the discussion has focused too much on the dollars in a vacuum. A fair assessment of our infrastructure and investment says that we are lagging, our state ought to do more. As a consequence of that assessment, revenues need to go up. Nobody that I know is saying that taxes need to go up for some arbitrary reason; instead the argument being made is that services and investment need to.

    I don't think anyone is saying Madicare should be expanded so that we can spend more money. I will say that tens of thousands of South Dakotans being covered by health care is something worth spending a little extra money on. Too many conservatives just leave out the people affected by their budgetary decisions. In fact, on the issue of irony, many conservatives will talk about the value of education, roads, health care . . . then fight to restrict the means of providing them: funding.

  7. Bill Fleming 2012.12.14

    That's what happens when we labor under the twin delusions that corporations are people and that money equals liberty and free speech.

    As per Steve, there is no room left for 'real' people in such an equation.

  8. Bob Mercer 2012.12.14

    Here's a simple dilemma to be solved: Highway funding. As vehicles become mpg-efficient, there could be less fuel used, and our fuel taxes are based on gallons sold. As more miles are logged by electric 'fuel', those miles don't provide any fuel tax for the highway fund. Better mpg and electric vehicles are better for the environment, but they pose a challenge for future funding of highway programs.

  9. Bob Mercer 2012.12.14

    And, btw, I don't know Jenny but I don't see a word about Tim Johnson in the original post I wrote. Nor was one implied, despite what she decided to infer. That was a comment on South Dakota politics, period.

  10. Jerry 2012.12.14

    Can this be what Minnie the Moocher was all about? The words from Cab Calloway's song just seem somehow, so right.

    "She had a dream about the king of Sweden
    He gave her things that she was needin'
    He gave her a home built of gold and steel
    A diamond car with platinum wheels"

    So that last line should take care of the wheel tax you speak of Mr. Mercer.

  11. Steve Sibson 2012.12.14

    South Dakota's budget for the current fiscal year was set at general funds $1,215,68,778; federal funds $1,360,473,398; and other $758,176,919.

    Bob,
    Is that without the "Informational" boards? The totals are much higher for federal and other:

    http://bfm.sd.gov/budget/rec14/08_budbook.pdf

  12. caheidelberger Post author | 2012.12.14

    Bob, you are right that the the percentages appear to vary. My calculations in my original moocher post put the SD FY2010 budget at 38.5% federal funds, third highest percentage in the nation and the current FY2013 budget at 43.8%. Gov. Daugaard's FY2014 proposal is 41.3% federal funds.

    And Bob, when I shout moocher, I am challenging the conservatives who run the budget to admit the reality of our state's fiscal situation. I'm fine with "mooching" or national mutual effort, as long as we call it what it is.

  13. Bill Fleming 2012.12.14

    Cory, how about "redistribution"? Too wonky? Too Marxist? LOL.

  14. Donald Pay 2012.12.14

    The moocher states are soon going to have a problem because current donor states with Republican Governors and majority Republican Legislatures (Wisconsin, Michigan, Indiana) are taking their states down the same road as the moocher states. If we keep following Republican economic ideas at both the state and national level, the ability of the donor states to pay a tribute to the moocher states will further erode. Moocher states will be forced to start paying more of their own way.

    States with strong union membership (ie., states paying a living wage, mostly the East Coast, Rust Belt and West Coast) have been carrying the nation, and the moocher states, for 30-50 years. Do away with Democratic and labor policies that assure the middle class can pay taxes, rather than fall into Romney's "47 percent," and you end up with a workforce in those states no longer able to pay the freight for themselves or the moocher states.

    What we see in Daugaard's budgets over the last two years is the Republican response: protect the elites and cut the poor and working folks.

  15. Dougal 2012.12.14

    I'd love to see South Dakota stand on its own without federal help. It wouldn't last 12 months before the jackasses in Pierre crawl to D.C. on their hands and knees to beg for their federal largesse.

  16. grudznick 2012.12.14

    Mr. Dougal, if we made everybody stand on their own foot we could do it. Cut the heck out of entitlements and such. The dems would be begging the Governor to go back to DC and get all the handouts. Betcha lunch.

  17. Douglas Wiken 2012.12.14

    "

    Here's a simple dilemma to be solved: Highway funding. As vehicles become mpg-efficient, there could be less fuel used, and our fuel taxes are based on gallons sold. As more miles are logged by electric 'fuel', those miles don't provide any fuel tax for the highway fund. Better mpg and electric vehicles are better for the environment, but they pose a challenge for future funding of highway programs."

    The roads and highways are not being destroyed by those small and electric cars. The heavy trucks and busess do about 15,000 times as much damage per mile driven. They might get 7 mi per gallon. The cars for ease of math 49 mpg. The fuel tax on large trucks then needs to be about 2000 times as much as tax per gallon for small vehicles. The problem is not the coming of light fuel efficient cars, the problem is every heavier trucks.

  18. grudznick 2012.12.14

    Did you make up the 15,000 number kind of like Mr. Howie makes up things and then bases the rest of his argument on it? I'm just askin...

  19. caheidelberger Post author | 2012.12.14

    Whatever solution we come up with for Bob's conundrum about maintaingin highways, the first question for South Dakota will be whether we choose to pay for our highways ourselves or whether we intend to keep depending extraordinarily on the federal government to subsidize our rural, long-drive lifestyles.

    Maybe there is an analogy between the red-state-moocher mindset and the rural automotive mindset. In both cases, we choose a very individualistic lifestyle (SD: low taxes; cars: indiv. mobility) that survives only when subsidized by Uncle Sam. When Uncle Sam's money dries up (whether through budget-cutting or decreased revenue from those darned Escapes and Prii), those individualistic lifestyles become unsustainable. We then face the uncomfortable propsect of changing our lifestyle (SD: taxing our wealth at the levels other states tax their; cars: giving up driving everywhere, investing in mass transit, maybe even consolidating into closer clusters of towns).

  20. Les 2012.12.14

    Wiken has stated that number before Grud, so fact it must be.
    A truck pays thousands in fees before it hits the road and when in legal weight does not destroy roads. I t is local over weight haulers destroying roads. All it would take is a law allowing the Hi Po to be able to audit the scale tickets to end the overweight damages.
    .
    Can you support that Doug?

  21. caheidelberger Post author | 2012.12.15

    Certainly overweight haulers do more damage. But shouldn't road wear and tear be a continuous function of weight? There isn't some discontinuity at the legal weight limit, with zero damage below and suddenly lots of damage above, is there?

  22. John 2012.12.15

    The solution to proper highway funding is not gas taxes, mpg, etc. It IS making the heavy vehicles causing the exponentially out-sized, scientifically proven highway damage and road wear to pay for it through exponentially out-sized vehicle registrations and titles. Under our currently perverted system there is a stepped advantage per-pound in being an obese vehicle and the morbidly obese receive the highest socialized registration welfare.

    We need an exponential registration rate system tracking with weight's destructive impacts and wear on our roads. Making the road-wreckers pay for their damage will drive market solutions to more efficient transportation like rail.

  23. Les 2012.12.15

    Can we agree that on a hot day a semi overloaded flipping up tar as it negotiates high speed turns is damaging?
    Can we also agree that local costs can be minimized by maintaining guidelines on weight limits set by engineers, which can only be accomplished if law enforcement has the help they need?
    Road damage is based on many factors Cory. Yes above certain weights the damage does become more exponential.
    .
    We are close to the point of equity on this issue with cars and trucks. My son's company runs trucks and he receives printouts of the miles run in every state, speed driven etc so all are comped according to the miles driven in each state and he knows if they drivers are following routes and or speeding etc. This is all accomplished by GPS and satellite. Put it on all vehicles and pay for what you use.

  24. Les 2012.12.15

    John does not understand our interstate highway system was designed for interstate commerce, not the family vacation.
    Charge what you will for roads and continue to subsidize rail, the cost either way will always fall into the hands of the consumer.

  25. grudznick 2012.12.15

    Mr. Wilken, is it 5000, 10000 or 15000? I feel 15000 times fuller after my gravy taters this morning.

  26. Douglas Wiken 2012.12.15

    Did you make up the 15,000 number kind of like Mr. Howie makes up things and then bases the rest of his argument on it? I'm just askin...

    Grudznicker, the 15,000 times ratio I used was information I received from a SD Highway Engineer in Pierre about 40 years ago when I worked in a highway safety project which at that time was in the SD Highway department, but was later moved to the Public Safety Department It really wasn't something they wanted spread around and certainly not with them as the source. Perhaps in those days without cheap computing, the actual ratio he gave me was not as accurate as is now possible. I think Cory has provided information to answer your question better.

    Between paying vehicle insurance doubled or tripled by tolerance of the liquor industry and paying far too much in gas taxes compared to heavy trucks, we are giving those special interests a lot of public welfare.

  27. grudznick 2012.12.15

    Tax the trucks and cut benefits for the able bodied that refuse to work.

    And Mexican statehood for the tribes!

  28. John 2012.12.15

    Les, the US interstate system was built for defense and commerce, not the family vacation - what a red herring. What's your point - that we should subsidize anothers' out-sized profits? That we should socialize the costs of commerce? Why should the psuedo-crooks who cause 99.9% of road wear and damage pay the lowest per pound cost for vehicle registration and titles? If these corporations and truckers are such good citizens, which they are not, then why aren't they paying their fair share to upkeep the infrastructure they use, routinely wear out, and destroy? It's long past the time to stop the corporate and truck welfare.

  29. Les 2012.12.15

    In the holiday spirit eh John? Guess I'm a pseudo crook also John, I take every honest deduction. How about the pseudo crooks in the rail system that we fixed and gave away or federally donated all the land for.
    .
    Throw some numbers on those truckers costs of using our roads. X squared talk is cheap Johnny. Prob why there isn't an old trucking company in existence.

  30. Douglas Wiken 2012.12.15

    Another dumb legislative and county idea. With a wheel tax, tax only the first 4 wheels. The highway damage is not done by the 4 wheels on a car or pickup. There is another cost avoided by the trucking industry.

  31. grudznick 2012.12.15

    15000 times more wheels should be taxed 15000 more dollars.

  32. John 2012.12.15

    15,000 times more wheels - exactly. The best science shows that trucks cause 5000 to 10,000 times more road damage and wear than do cars. Therefore the trucks should pay 5,000 to 10,000 times more for titles and registration than do cars. Then and only then are the freeloaders finally paying their fair share and paying their way. Corey cited the science, Les, no need to repeat it here.

  33. larry kurtz 2013.01.27

    An ice storm is taking power lines down East River as a utility fire paralyzes downtown Sioux Falls: what will a red moocher state do? Yep, vote against disaster relief for hurricane victims.

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