The Blue State-Red State Tax Divide Isn’t Really That Fair
Yes, incomes are much higher in Democrat-leaning areas than in Republican ones, but when adjusted for regional cost of living they’re often not all that high.
Blue-voting areas pay more because that’s where the money is.
Photographer: Scott Olson/Getty Images
The Trump administration’s many attempts over the past couple of weeks to halt federal spending have met mostly with approval from Republicans on Capitol Hill and outrage from Democrats. That’s sort of what one would expect given that Trump is a Republican, but also kind of weird in that states and congressional districts that vote for Republicans are as a rule much bigger net beneficiaries of federal spending than those that vote for Democrats.
With the federal government running a deficit of 5.9% of gross domestic product in the 2022 fiscal year — the most recent available in the state balance of payments data compiled by the State University of New York’s Rockefeller Institute of Government — even blue states got more back from Washington than they sent there. But their deficit amounted to just 0.4% of GDP. The red-state shortfall was 3.1% of GDP, with interest payments accounting for most of the rest of the federal deficit.