States Decision?

[NowISeetheLight]

Then how about states pay for themselves. There has long been a series of Red states funded by Blue states. The Red states have ultra-low taxes and criticize the taxes in blue states yet happily take in a lot more than they pay in federal taxes. The Southern states are some of the biggest culprits, especially Moscow Mitch McConnels Kentucky. I remember when he criticized Covid aid to New York and Governor Cuomo replied “fine then give us back our $20b+ in overpayments”.

If states want the right to vote and make decisions about peoples lives let them pay for themselves. Interstate highways should be funded federally but all this aid for rural roads, infrastructure, etc, let them pay for it.

I know here in California we are criticized a lot by the Red states. We’ll give us back the $6b+ extra we paid in then. If you think your state is so great let it pay for itself. If your state is such a great state you don’t need other states to pay your way. Right?

New York is the largest donor state in the U.S., with a negative balance of payments at $22,798,000,000. For every dollar New York gives the federal government, its residents are only receiving $0.91 back.

Seven other states are donor states:

New Jersey (-$10,334,000,000)
Massachusetts (-$9,919,000,000)
California (-$6,653,000,000)
Connecticut ($5,754,000,000)
Minnesota (-$1,896,000,000)
Colorado ($1,374,000,000)
Utah (-$416,000,000)
Virginia is at the opposite end of the spectrum, with the highest positive balance of payments. Virginia’s balance of payments is $111,785,000,000, and residents receive $2.24 for every dollar sent to the federal government. Kentucky follows with $63,229,000,000 and the highest expenditure per dollar of receipts at $2.89.

The ten states with the largest positive balance of payments (the biggest takers) are:

Virginia ($111,785,000,000)
Kentucky ($63,229,000,000)
Florida ($50,999,000,000)
Maryland ($49,942,000,000)
Ohio ($42,004,000,000)
Pennsylvania ($41,516,000,000)
North Carolina ($35,437,000,000)
Alabama ($33,033,000,000)
Arizona ($30,907,000,000)
South Carolina ($28,209,000,000)


A lot of Red states getting “handouts”….

https://www.moneygeek.com/living/states-most-reliant-federal-government/

[Scrivener7]

1. This. We should not have to fund the subjugation of women.

[exboyfil]

2. Kentucky is mind boggling given it population

No wonder McConnell keeps getting elected. He brings the pork home.

Virginia is a special case given that it is next to Washington, DC.

[MichMan]

3. No, we shouldn't distribute government funds based on state or local boundaries like you propose

One could argue with the same reasoning that residents of wealthy suburbs shouldn't be taxed to provide services to people living in poverty in the urban cities.

Why should taxes from residents of Grosse Pointe, Michigan, for example, be used to provide programs for poor people in Detroit ? Let Detroit raise taxes and take care of their own residents, while Grosse Pointe gets to spend all it's own tax dollars. No one would say that would be acceptable, right ?

We tax people based on ability to pay and distribute it in the form of services and payments to those who are eligible, regardless of what city or state they live in. In fact, we usually argue that those in the more wealthy cities and states need to be taxed more, not less.

[in2herbs]

4. "We tax people based on ability to pay and distribute it in the form of services and payments

to those who are eligible, regardless of what city or state they live in."

Question: What if these red states are only eligible to receive more than what they pay in because they intentionally keep giving corporations in their state tax breaks knowing the feds will make up the difference?

[MichMan]

6. The whole comparison of donor vs taker states is disingenuous

Because the majority of Federal benefits go to people, not states. The figures in the OP are in regards to Federal revenues (taxes) vs Federal expenditures on a per capita basis by state.

Should residents in Philadelphia, Pa, (a "taker" state) receive less food stamp dollars, or Social Security payments than people living in Salt Lake City Utah (a "donor" state ) because their state receives more federal dollars than it sends in?

I always thought that the wealthy (people & states) should pay their fair share of taxes because they can. Not that the wealthy should be taxed less because their dollars are being sent to people living in the "wrong " states

[NowISeetheLight]

7. Then set the state tax rates equally

I’m not talking about things like Medicare and Social Security. Social Security us set based on your earnings history. This is fair as more expensive areas often have higher wages and thus likely have higher expenses to live. Medicare is the same for everyone. I’m talking about things like schools, police, fire, etc. Here in CA we have very high state income taxes. Our state provides a lot of services that states like Alabama and Texas do not. Yet states like Alabama (and Texas especially) feel free to criticize us. Why should taxes raised in California then go to educate students in Alabama where they ban books and create a hostile environment to KGBT and minority students?

We need national standards. Having every state be a patchwork of laws and taxes is a mess. If these people in these states believe their states are so superior to California and they want to have bottom of the barrel tax rates and ban books then they should pay for their own way. I mean if their state is so superior everyone should want to live there right? They shouldn’t be able to have super low (or no) state income tax yet subsidize those expenses normally paid for by state taxes with federal tax dollars collected by everyone else.

One example is Medicaid. I notice a lot of these Red states didn’t expand Medicaid. They’re receiving top $$$ rates and they couldn’t even expand it? This page has a table showing the federal funding per resident. It’s pretty eye opening.

https://worldpopulationreview.com/state-rankings/federal-aid-by-state

[MichMan]

11. The percent of funding from the Federal government for schools, police and fire is very low

The Federal government doesn't say that since Mississippi doesn't spend enough on schools, here is a check to make up the difference. The Federal funding for schools is based on poverty levels of the students irrespective of what state they live in.

I must say I'm surprised that there would be opposition here to schools serving poor kids getting Federal funds. Frankly, it sounds a lot like rich RW that don't want their tax dollars going to help "those people"

Your position on Medicaid in Red states doesn't make any sense. After arguing that some states unfairly take more in Federal dollars than their residents contribute, you then complain that Red states aren't taking even more Federal money to expand Medicaid. Isn't that what you say you are against?

[NowISeetheLight]

8. If Detroit...

Spent their time criticizing Grosse Point, trying to lure away businesses and citizens by claiming Grosse Pointe us overtaxed and too liberal, then yes, let them pay their own way.

I’ve always wondered what “fair share” means. I’ve read half the US population pays no federal income tax at all. I’ve never had anyone give me a definition. Some will post 90%! Where is the incentive then? I know taxes have to be paid but believe everyone should have some skin in the game. When I was in the navy in the 80s as an E-3 I made around $790 a month. Every two weeks we’d line up in the mess deck and the disbursement officer would pay us. I’d get around $250 after taxes. I’d get a little back at year end but I was paying something in federal taxes. I had some skin in the game. Thus I was interested in current events, politics, social issues.

Before I had to retire in 2020 in my mid 50s (medically) I had a good six figure salary. I worked 50-60 hours a week and worked my way up over 14 years from a $12 an hour entry level job in medical coding to an upper level manager position in revenue cycle with a big health system. I was in the top 10% salary wise and being single with no kids I paid an effective tax rate of around 16% a year (per turbo tax). I had a mortgage interest deduction and church contributions but that was it. My six figure college loans were expensive and I made too much as a single person to deduct the student loan interest. I didn’t mind though. I know things cost money and I realize I should not be adverse to helping others. I’m pissed off when I read some people hide their income to avoid taxes, but overall I believe most upper income earners are paying their taxes. I don’t believe in taxing assets (wealth tax) because until a gain is realized it should just sit. Conversely though I also don’t believe that inherited assets should be stepped up in value thus avoiding taxable gains (like inherited stocks). That stuff should be taxed.

IRS Tax Year 2018 Report

Top 1% - 21% of AGI, paid 40% of total taxes, avg rate 25.4%
Top 5% - 37% of AGI, paid 60% of total taxes, avg rate 22.0%
Top 10% - 48% of AGI, paid 71% of total taxes, avg rate 19.9%
Top 25% - 69% of AGI, paid 87% of total taxes, avg rate 16.8%
Top 50% - 88% of AGI, paid 97% of total taxes, avg rate 14.6%
Bottom 50% - 12% of AGI, paid 3% of total taxes, avg rate 3.4%

All taxpayers - 100% of AGI, 100% of total taxes, 13.3% avg rate

[MichMan]

15. Now I understand. You believe the bottom 50% isn't paying enough and the top 50% is paying too much

Serious doubt that you are going to get any agreement here for that position. Are you sure you are posting on the right site ?

[NowISeetheLight]

17. Not at all

I think a progressive tax system is best. What I’m saying is everyone should pay something. Even if it’s 1%. Paying something helps people invest in something. If I’m having to pay for something I pay attention to it. It’s been documented in studies that higher income people vote in much higher percentages. That could also be construed to believe they are paying more and are thus participating.

Another example would be I’d be in favor of a sales tax refund for low income people. They spend a higher percentage of their income on essentials like food and housing. I’d favor a higher tax rate based on cost too. Lower the sales tax on a lower priced car and have a higher rate on a more expensive one. A $10,000 used car could be 4% and a $250,000 Bentley could be 15%. Sales taxes support state and city projects.

Asking what a definition of “fair share” is isn’t a bad thing. Just give me a percentage. What is fair? I may agree with you. I’d like to see the taxes go up a bit to save Social Security and Medicare. I realize the only people who can pay more are the people with the money. I have no problem with that. I’d just like someone to come and say 1+2=3 with some exact percentages.

[JosieSD]

5. This is basically an argument for trickle down economics

What you are inadvertently arguing is that rich people in New York should pay lower taxes because they have the right political beliefs. And poor people in Kentucky should pay more until such time as they vote better.

[NowISeetheLight]

10. Not exactly

I’m just saying why should my tax dollars go to support people who would discriminate against me and refuse to let me marry if I lived there. We sanction countries for political reasons. States like Florida threatened to stop payments to school systems who disagreed with them.

Rich people in New York pay very high taxes. I recall Trump yanked a property tax credit they used to get specifically calling them high tax and poorly run (the SALT exemption). If these states are willing to tax their citizens more for things like schools and services that is their right. I grew up in Minnesota which has excellent schools. Property taxes there were about 3x what they were when I lived in South Carolina.

Why should I pay high property taxes to fund my local schools and also pay taxes to fund schools in areas that don’t? It’s like me asking you to pay part of my car payment because I don’t want too. At the same time I’m going to criticize you for your high car payment and yell how irresponsible you are. But you still have to pay mine too.

https://smartasset.com/taxes/trumps-plan-to-eliminate-the-state-and-local-tax-deduction-explained

[Deep State Witch]

9. Virginia and Maryland

Both have a lot of Federal government facilities located there. That probably accounts for most of the Federal dollars incoming.

[NutmegYankee]

12. Yes. A circle 100 miles in diameter based on DC would contain 400,000+ Fed Workers.

[former9thward]

16. Four of the ten "taker" states gave their electoral votes to Biden.

I guess the definition of "red" is flexible depending on what state needs to be bashed.