In the last article I tackled how California Governor Gavin Newsom used misleading statistics in an attempt to cast doubt on the severity of his state’s population hemorrhage. That wasn’t all he said - but so much misleading information was repeated that it wasn't plausible to fit a rebuttal into a single article.
Newsom also rattled off a number of other statistics to try to paint liberal economics in a positive light. Among them was the claim that 71% of America’s gross domestic product (GDP) comes from blue counties (based on how they voted in the 2020 election).
It’s no secret that people with left-leaning politics tend to congregate in population centers (to the extent that this is a global phenomenon), while those with more conservative values tend to live in rural and suburban areas. Overall, 67 million more people live in counties won by Biden (population: 197.9 million) than Trump (population 130.3 million).
In the best case scenario, Newsom could try to argue that blue counties are still outperforming because they’re home to roughly 60% of the national population but account for 71% of GDP - but one must keep in mind that GDP figures are nominal. If State A and State B produce an identical economic output in terms of goods, and the cost of living in State A is 50% higher than State B, the GDP of State A will be 50% higher than State B. And as anyone that’s traveled is aware, blue states are way more expensive than red states. The cost of living in blue Hawaii is nearly double the national average, while blue New York is nearly 50% more expensive, and blue California about 42% more expensive. A $5 bagel purchase in Hawaii adds $5 to GDP - while that exact same bagel purchased in the average state would only add $2.5 to the GDP figures.
A high cost of living gives the appearance of wealth where it doesn’t fully exist. As I noted previously in 2018 refuting former Clinton Labor Secretary Robert Reich when he argued that California is a model for America, after adjusting for the cost of living, California ranks #1 in poverty. Oddly, Newsom didn’t mention that.
Newsom also repeated the myth that red states are “welfare queens,” and are being subsidized by blue states. This is something I’ve written on previously, which is reposted in full below:
It is first important to remember that states are not people. It’s entirely possible for the following facts to be true simultaneously; that red states receive more in federal welfare, but Republicans themselves don’t. A Maxwell Poll on the political affiliation of those in public assistance would indicate as much:
Similarly, an NPR study of the long-term unemployed found that 72 percent favor Democrats, who are all likely to be receiving benefits.
The only exceptions would be Medicare and Social Security, which are often included in the calculations of federal money going to red states (as opposed to just including traditional welfare programs). And indeed, this would skew the stats when it comes to federal dollars coming to red states. Recipients of those programs are disproportionately Republican, but this is a program 100% of people will eventually be eligible for, and it’s one received after paying into it over a lifetime, so it feels misleading at best to include, regardless of what you think about the programs.
But that’s just welfare. People aside, what about the claim that red states as a whole receive more from the government? While it is true that red states tend to have a larger percentage of their budgets subsidized by the federal government than blue states— that's only because their budgets are relatively smaller. As The Federalist’s Kyle Sammin notes:
Against a national average of 32.62% [of a state’s budget] being federally subsidized, the blue states received 30.80%. Purple states were almost exactly at the national level with 32.92% coming from Washington. Red state budgets averaged 35.75% federal money.
A problem with this metric is that although federal funds make up a larger percentage of red states’ state budgets, the budgets in those states are generally lower overall than those of the free-spending blue states. If, instead of comparing federal funds to state budgets, we look at how much the federal government spends in intergovernmental grants per resident of a state, the results are turned on their heads.
In other words, Sammin points out that because red state budgets tend to be smaller, it would make more sense to look at intergovernmental grants (payments from the federal government to state governments) on a per-capita basis, not as a percentage of state budgets.
Against a national average of $1,935 in intergovernmental spending per American, red states receive just $1,879. Blue states get considerably more, at $2,124 per resident. Purple states see the least of their money returned to them per capita, at just $1,770.
Matt Palumbo is the author of Fact-Checking the Fact-Checkers: How the Left Hijacked and Weaponized the Fact-Checking Industry and The Man Behind the Curtain: Inside the Secret Network of George Soros
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