Wednesday, May 28, 2003

Spending and State Republicans-This USA Today piece on state spending growing faster in Republican-controlled legislatures;Josh and Kevin have comments.
State legislatures controlled by Republicans increased spending an average of 6.54% per year from 1997 to 2002, compared with 6.17% for legislatures run by Democrats. State spending rose slowest -- 6% annually -- when legislatures were split, and each party controlled one chamber. Inflation averaged 2.55% annually 1997-2002.
I would have to do further study, but I think there is a reason other than Republican spendthriftness-welfare reform. There were a lot of federal programs that were block-granted over to the states stemming from reforms in the Clinton-Gingrich era. The CHPS program expanding Medicaid to modest-incomed children was started in 1997 and basic welfare was block-granted to the states in 1996. This meant an influx of federal money just as the study started. A second factor was the tobacco health-care settlement money states got. Few legistatures had the guts to save that money and cut taxes; instead, the money was used to fund a variety of projects. In smaller-spending states, the money would wind up making spending go up by a higher percentage than in bigger-spending states. If Republican states were doing a good job of controlling spending prior to these events, the increase in spending would mean that states with low spending levels would mean larger percentage increases in the GOP states. Let's say Blue State is spending $1000 a person and Red State is spending $800. Add a $100/person federal welfare block grant. Blue State just went up 10%(100/1000) while Red State went up 12.5% (100/800). Due to the lower spending levels, Red State legislators look like spendthrifts when things are stated on a percentage basis, even when they have been holding the line on spending. I have a hunch that those two factors will make up the lion share of the difference between Democratic and Republican legislatures.

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