The Regional Impact of Government Taxing and Spending Policies

Carole E. Scott is a Professor of Economics at the State University of West Georgia and the Editor of B>Quest.

If you do not like the background color, you can change it by highlighting the color you prefer in the scroll box below.

What is an equitable distribution of income? Communists believe that it is inequitable for people's incomes to differ. They believe that the free market system is inequitable because it produces income inequality. This, of course, is a value judgment. Supporters of free markets believe that it is unfair and growth stunting for those who contribute more to the production of the nation's output of goods and services not to earn more than do the less productive. Income inequality, they believe, is the price that must be paid for economic growth, as without the incentive of earning more, people will not be as productive. Communists disagree because they believe self interest can be stamped out and replaced with altruism.

If income inequality is inequitable, but it is necessary in order to maximize economic growth, then there is a trade off between equity and growth. If the government uses its power in an attempt to eliminate or reduce income inequality, there is a trade off between equity and liberty--the right of a person to be sovereign over himself. Critics of government programs designed to reduce income inequality complain both about the loss of liberty and the fact that these programs do not treat all persons equally under the law.

Through progressive income taxation and the provision of transfer payments to people whose earned income is low, the Federal government seeks to cause people's after tax income to differ less than does their before tax income. As is true of many Western European nations, in the United States income dispersion has been increasing in the since the 1970s. [Weiner and Monto, 2]

To analyze how government makes decisions regarding taxing and spending, some economists have developed what is called public choice theory. The political marketplace, they say, is composed of voters, politicians, and bureaucrats. Voters are the consumers in this marketplace. They express their preferences by how they vote and the candidates they support with campaign contributions and other forms of support. According to this theory, they support policies that they perceive will make them better off and oppose those that will make them less well off. They chose to remain ignorant about issues that either do not affect them or they cannot influence. Government grows due to their preferences and inefficient over production.

Politicians are the entrepreneurs who supply voters with what they want. Their profit is to be elected to and remain in office. To achieve this they provide voters with whatever it is that they want. Government bureaucrats manage the operation. Like voters and politicians, they seek to maximize their own utility. To do this they seek to maximize their departments' budgets.

It is not difficult to find examples that seem to provide empirical support for public choice theorists' assumptions. For example, in a 1998 article in The Wall Street Journal by David Rogers, he reported that the "conservative" Tax Foundation estimated that Mississippi got back about $1.64 for every tax dollar it sent to Washington. "Although its poverty partly explains this imbalance, the money machine also is driven by Mississippi's enduring power in the appropriations panels.... Mississippi's transformation from Democratic to Republican pork-barrel spending illustrates a larger change in the GOP itself." Republicans, Rogers claims, have abandoned the "battle cry" for budget cuts and a line-item-veto to curb federal spending in order to follow the pork-barrel spending agenda of their Democratic predecessors. As a result, "For all its conservatism, the South leads the nation in its share of federal spending per citizen. Census Bureau figures show the per-capita rate of federal spending in Mississippi is up about 13% since 1993, the year before the GOP captured Congress." [Rogers, Front Section]

Some think self-interest does not dominate the public sector to the extent that public choice theorists claim. Avinash Dixit and John Londregan disagree with "The prevailing positive models of redistribution [which] assume that all players in the politico-economic game are selfishly motivated: citizens and voters care for private consumption; and politicians for power, reelection, or material gains." [Dixit and Londregan, 497] "In reality," they believe, "citizens and politicians alike do care for distributive equity as a public good. They may not sacrifice much private consumption to achieve greater equity on an individual basis because of free rider problems, but they may vote to implement general policies that will require them and everyone else to make some such sacrifice. Therefore, these ideological aspects of voters' choices and parties' platforms play an important role in the political process." [Dixit and Londregan, 197] (Free riders are people who benefit from other people's expenditures.)

Dixit and Londergan believe there are "rich liberals who will vote for a leftist party that promises a high tax rate, and poor libertarians who will support a rightist party even though they will personally benefit little from its tax and transfer policies." [Dixit and Londregan, 499] However, in a 1978 article, "Regionalism, Redistribution, and Federal Spending," U-Jin Jhun and James Cicarelli claim that the hypothesis that the disparity in federal spending is based on the goal of income redistribution is not true. Indicative of this is their finding that Federal spending is not based on the levels of poverty or unemployment within a state.

As proof that political parties care about more than their performance at the ballot box, Dixit and Londregan point out that "The British Labour party lost four successive general elections from 1979 to 1992 by sticking to an increasingly unpopular leftist ideology before it finally changed its platform. In the United States, the Democrats in the 1980s, and perhaps the Republicans in the 1990s, provide other examples of adherence to extreme ideologies even at the cost of electoral success." [Dixit and Londergan, 1991] However, typically, they believe, the rich will favor a rightist party because their private consumption will be greater if it prevails, while the poor will favor the leftist party for the same reason.

However, Dixit and Londergan conclude that parties will compromise their ideology in order to get more votes, "...adjusting both the ideological and port-barrel components of policy to cater to the pivotal voters." [Dixit and Londregan, 520] "Parties also take advantage of the opportunity for ideological compromise, moving their platforms away from their ideologies, in the direction of a point that can be regarded as the pivotal center of ideology in the electorate." [Dixit and Londregan, 521]

Some believe that it is impossible for the government to eliminate income inequality because "Income that a government obtains and redistributes will be competed for, and competed for through politics. All kinds of interests will compete for the income, not just families in lower income quintiles, but families in the upper quintiles, farmers, lawyers, older citizens, young parents, etc. The winners of the political competition for income will be the most politically powerful interests--interests with significant per capita wealth, a narrow economic focus and substantial income at stake. That hardly describes families in the lower income quintiles. If families in the lower quintiles are unlikely to succeed in the political competition for income, redistribution will not generate a more equal distribution of income." [Mathews, 77] In support of this contention, Don Mathews points to studies by Don Reading and Gavin Wright that show that New Deal spending was not allocated to the regions with the lowest per capita incomes or those with the highest unemployment rates. Instead, 75 percent more went to the Pacific Northwest, a high per capita income region with tight elections, than to the region with the lowest per capita incomes, the one-party South. [Mathews, 79]

Income redistribution carried out through transfer payments to individuals may have regional effects because some states have a relatively larger share of lower income groups than do others, and some grant programs are designed to favor low income states. Also, because Federal installations, both civilian and military, and businesses that supply the government with goods and services are not evenly distributed among the states, other federal spending, too, has a regional impact.

Because some states send more money to Washington than they get back through grants, salaries and wages, direct payments to individuals, contracts, and other programs, while others get back more than they send to Washington, the Federal government redistributes income between the states. Deficit states (those sending more to Washington than they receive) and surplus states (those sending less than they receive) are not randomly distributed. There are "clusters" of deficit and surplus states.

In 1996 the Federal government spent slightly over $4,800 for each person in the United States. As has always been true, it spent more in some states than it took from them in taxes. In other states, the reverse was true. Twenty (deficit or donor) states sent more to Washington than they got from it. It collected more (in descending order of magnitude) from New Jersey, Connecticut, Illinois, Michigan, New Hampshire, Minnesota, Wisconsin, Delaware, Nevada, New York, Indiana, Ohio, Oregon, Massachusetts, California, Colorado, Washington, Kansas, Nebraska, and Texas than it distributed to them. New Jersey and Connecticut, the largest deficit states, lost nearly $2,000 per person, 10 percent of per capita income. The largest recipient state, New Mexico, gained $3,200 per capita. [Walder and Leonard, 1996, 1-2] By 1997, New Mexico's gain had risen to $3,500. [Walder and Leonard, 1997, 2] In 1997, Virginia received $18 billion more from the Federal government than it sent to it. No other state had as large a surplus. Illinois sent $20 billion more to Washington than it received from it in 1997. No other state had as large a deficit. [Walder and Leonard, 1997, 2]

Some demographic characteristics of the ten largest surplus states and the ten largest deficit states are shown in Tables One and Two below.

Tables One and Two (above) reveal that there are no states in the Northeast or Midwest among the surplus states. The only state losing population between 1990 and 1995 was a deficit state, Connecticut. Although the largest states among these twenty states are deficit states, both the surplus and the deficit states include some relatively small states, and the smallest state, Delaware, is a deficit state. However, the total population of the ten largest deficit states was more than twice as large as that of the ten largest surplus states. As a result, the ten largest deficit states have far more seats in Congress than do the ten largest surplus states. The other deficit states are several that have California, Colorado, Indiana, Kansas, Massachusetts, Nebraska, Ohio, Oregon, Texas, and Washington. There were 30 surplus states, so they had more seats in the Senate (60), than did the 20 deficit states (40).

Data shown below from the 1996 edition of the Statistical Abstract of the United States reveals that although net domestic migration was not confined to the ten largest deficit states, it was more common among them and was on the average greater. Revealed, too, is that the deficit states were the more densely populated.

The data shown below, gathered like the above demographic data from the 1996 issue of the Statistical Abstract of the United States, reveals that poverty was more prevalent in the surplus states than the deficit states both in 1980 and in 1994. However, there was some narrowing of the gap between them over this period. Average real (constant dollar) income was lower in 1994 in the surplus states than the deficit states. Therefore, if equitable treatment means transferring income to the less well off, the direction of the redistribution was appropriate.

Average percent of the population below the poverty level in surplus states: 15.3 %

Average percent of the population below the poverty level in deficit states: 10.1 %

Range of the percent below the poverty level in surplus states: 8.5 % to 24.3 %

Range of the percent below the poverty level in deficit states: 7.0 % to 13.8 %

Average percent of the population below the poverty level, surplus states: 14.4 %s:

Average percent of the population t below the poverty level, deficit states: 11.1 %

Range of the percent below the poverty level, deficit states: 7.7 % - 17.0 %

Table Three (below) reveals that the average amount of each type of Federal spending was greater in the ten states with the largest surpluses than in the ten with the largest deficits.

In 1996 and 1997 studies Jay H.Walder and Herman B. Leonard discovered that Federal taxes are highly positively correlated with income, while its spending is mildly negatively correlated with income. [Walder and Leonard, 1996, 23-24] In fiscal year 1997 they calculated that the simple correlation of income and taxes exceeded 0.97; therefore it is clear that the most important determinant of the amount of Federal taxes collected in a state is its residents' average income. The distribution of taxes in fiscal 1996 and 1997 was almost identical. They found that the Federal tax system is mildly progressive, with the lowest-income states, which are concentrated in the southern and mountain states, paying about 18 percent of their income in Federal taxes, while the highest-income states paid about 20 percent. [Walder and Leonard, 1997, C ]

Walder and Leonard concluded that after tax net income is more evenly distributed among the states than is their before tax income. Although both taxation and spending are redistributive, while the former has been largely constant over time, the latter has become more redistributive. [Walder and Leonard, 1996, 3-4 and 1997, 4] They attribute this to: (1) the fact that payments to individuals that are strongly negatively correlated with income comprise the fastest-growing portion of the budget; (2) Federal grants to states and local government has become significantly more negatively correlated with income; and (3) defense spending that wealthy states tend to receive more of declined. [Walder and Leonard, 1996, 14-25]

Walder and Leonard found "few noticeable shifts in the per capita spending for each state" between 1996 and 1997, as "The geographic pattern of states with high Federal spending and low Federal spending is almost unchanged. Moreover, the few changes" they observed did not appear to be related to the Republicans becoming the majority party in both the House and the Senate. [Walder and Leonard, 1997, A ] "Federal spending for a large group of Northeast and Great Lakes states was more than 10 percent below the national average and spending in three of these states--New Hampshire, New Jersey, and Wisconsin--falls below the national average by more than 20 percent." [Walder and Leonard, 1997, A ] Major variations between states' balance of payments with the Federal government, they concluded, are due to fluctuations in the underlying individual components of spending:

As can be seen below, military spending was substantially greater in the surplus states.

Shown below is the fact that while the number of Democrats and Republicans in the deficit states was about the same, in the surplus states Democrats substantially outnumbered Republicans. Note, too, that the ten states having the largest surpluses states have less than half as many representatives in Congress as do the ten states with the largest deficits. Therefore, the largest donor states can out vote the largest recipient states.

If, as they are often characterized, Democrats are more likely to support income redistribution, and self-interest governs voters and politicians, the dominance of Democrats in the surplus states is what would be expected. However, as will be shown later, the average member of Congress from the surplus states votes more conservative than does the average member representing deficit states.

Back in the 1970s some claimed that the low level of economic growth in the Northeast and the Midwest was the direct result of their deficit states. [Jhun and Circarelli] To demonstrate the inequity with which he believed New York State was subject to because the Federal taxes paid by New Yorkers exceeded the amount of money put back into their State by the Federal government, U.S. Senator Daniel Patrick Moynihan (D, N.Y.) began an annual report, "The Federal Budget and the States," compiled in recent years by Jay H. Walder and Herman B. Leonard. It is published annually by the Tubman Center for State and Local Government and the John F. Kennedy School of Government at Harvard University.

The inequity Senator Moynihan complains of is that his relatively rich state sends more money to Washington than it gets from Washington. He complains, for example, that while in Arkansas, a much poorer state, the Federal government foots the bill for 73 percent of Medicaid, it covers only 50 percent in New York. [Walder and Leonard, 1996, 8]

Senator Moynihan and other New York politicians are disturbed by New York State's loss of manufacturing jobs and New York City's loss of corporate headquarters. New York City had more than one million manufacturing jobs after World War II and about a quarter of a million people on welfare. By 1997 it had about 300,000 manufacturing jobs and about 850,000 people on some form of public assistance. [Siegel, 21] Former New York Mayor John Lindsay, a Republican, "...eagerly embraced the ideology--and the federal subsidies--of the Great Society and consciously sought to increase access to and eligibility for welfare benefits. Between 1965, just before he took office, and 1971, the city's welfare rolls grew from 538,000 to 1.2 million during an economic boom." [Siegel, 22] It was during this period that a sizable exodus of corporate headquarters from New York began.

Figures One and Two (below) from the fiscal year 1997 issue of "The Federal Budget and the States" reveal why dissatisfaction with the Federal government redistributing income is expressed by a Senator from a Northern state. Observe (below) that the states taxed the heaviest and receiving the least Federal spending are concentrated in the Northeast and Midwest. However, there are states experiencing above average tax burdens in the South and Far West, and among the states receiving the lowest spending per capita are some in the Far West.

"New York," explains Senator Moynihan, "is a liberal state, and you can't break out of the notion that anything you get from the federal government is sort of free. But all the formulas [for distributing Federal money to the states] are the other way around." [Siegel, 24] As a result, more money flows from New York State to Washington than is returned to it, and the net flow to Washington has grown. From 1984 to 1994 New York's "deficit" grew from two percent to four percent of the State's income. [Siegel, 24]

Senator Moynihan says that New York has supported the very programs that cause it to send more money to Washington than it gets back from Washington. "...Whatever our economic problems might be," he says, in the past it was believed that "...they surely had little to do with programs coming out of Washington, or how they were being financed. New Yorkers supported those programs; created many of them. If they were redistributive, well that was the idea. Our own resources were surely sufficient; we could take care of ourselves. Then, of a sudden, a short while back attitudes changed. That at least is my impression, and comports with a general view of public opinion..." [Walder and Leonard, 1997, A ] The Senator may have pinpointed the reason for a change in New Yorkers' attitude when he wrote that "The plain fact is that New York has developed a bipolar economy. New York City, Long Island, and Westchester are prosperous right now, due to the financial services industry and tourism, but the rest of the State, not just the Southern Tier, is in prolonged economic malaise." [Walder and Leonard, 1997, B ]

Table Four (below) demonstrates that New York State is rather heterogeneous politically, economically, and demographically.

The only consistent patterns in the data shown in Table Four (above) is that all the districts where whites were a minority or household income was less than $24,000 were represented by Democrats. In light of the variances between New York's Congressional Districts, it is not surprising, as is revealed below in Table Five, that the men and women who represent these districts vote significantly differently.

Used in Table Five to classify New York House members voting records are what is called the National Journal Ratings. These ratings are based on an objective method of labeling as liberal or conservative the voting record of members of Congress. A panel of editors and staff compile a list of Congressional roll call votes, classifying them as either economic, social, or foreign-policy related. A professor at the University of Vermont then applies a statistical procedure to classify them as fitting either a liberal or conservative pattern. Table Five shows for 1982 what percent of each of New York's then 34 representatives' votes on bills classified as being economic that was "conservative." (D = Democrat; R = Republican) Government redistribution of income is, of course, widely perceived as being a "liberal" policy.

One does not need to run a correlation analysis to see that there was a distinct difference between how Republicans and Democrats voted. The former voted much more conservatively. Thirty-nine was both the lowest Republican percentage and the highest Democrat percentage.

In both 1982 and 1996 the Democrats accounted for approximately 58 percent of the New York delegation. Table Six (below) shows how the 1996 House delegation voted.

Tables Four and Five reveal that relative to economic issues there was no shift towards conservatism in the New York House delegation. Republicans' votes averaged 59.3 percent conservative in 1984 and 55.6 percent in 1996, while the Democrats, respectively, averaged 14.3 percent and 13.9 percent. There was, however, a split among the Democrats in 1996 that did not exist in 1984, as only one had a zero percent rating in 1984, while five of them had a zero percent rating in 1996. Four of these Democrats represented districts in which whites were a minority. (These districts are indicated by asterisks in Table Six.) Lower income districts represented by Republicans tended to have above average-sized rural populations. For example, sixty-seven percent of the 22th District's population was rural; 65 percent of the 24th, and 55 percent of the 23rd and 27th.

In both 1982 and 1996 New York had a Democratic and a Republican senator. In 1982, the Democrat (Moynihan) had a National Journal Rating of zero percent. The Republican's was 61 percent. In 1996, the Democrat (Moynihan) had a National Journal Rating of 14 percent. His Republican peer's rating was 54 percent. So while Moynihan became more conservative, the Republican became slightly less conservative. The economic-issue votes of the entire New York Congressional delegation do not indicate that Moynihan's concern over New York State's "deficit" status with the Federal government has increased the degree of political conservatism in New York State in regard to economic issues.

As can be seen in Table Seven (below), in Alabama the patterns seen in the votes of New Yorkers in Congress do not exist except that the 7th District follows a pattern found in New York: a Democrat representing districts with relatively low income and white and rural populations.

Tables Eight and Nine below reveal that the Congressional delegations of the deficit states voted less conservatively than did those of the surplus states, and that both groups' senators and the surplus states' representatives voted less conservatively in 1996 than in 1990. However, the voting patterns of the states in both groups differ significantly. Maryland's senators, for example, were less conservative in both years than were any of the deficit states' senators, and Hawaii's delegation was less conservative than were the delegations of several deficit states. In both groups of states there were states whose senators voted considerably differently than did their representatives.

State	1990 Senate	1990 House	1996 Senate	1996 House
Illinois	21.83	40.95	14.33	45.58

New York	30.17	32.80	40.17	31.71

New Jersey	15.17	33.79	19.50	29.43

New Hampshire	76.50	--(new)--	68.17	64.67

Connecticut	25.83	33.25	29.00	27.87

Delaware	41.50	32.67	44.17	46.00

Nevada	27.83	69.33	33.67	58.00

Michigan	32.33	36.00	42.17	38.07

Minnesota	58.00	25.94	40.17	29.71

Wisconsin	46.50	49.67	13.67	39.86


Averages	37.57	39.38	34.50	41.09

State	1990 Senate	1990 House	1996 Senate	1996 House
Maryland	6.33	35.33	11.83	40.43

Virginia	55.00	61.74	49.33	49.53

West Virginia	39.33	29.67	25.33	31.44

Alabama	55.50	64.56	71.67	60.20

Mississippi	83.67	56.20	73.67	58.67

North Dakota	23.00	30.33	29.83	29.00

Montana	59.67	47.67	55.00	-- (new) --

New Mexico	47.33	59.33	26.83	61.17

Alaska	73.17	73.00	67.17	76.33

Hawaii	22.00	-- (new) --	15.67	16.50


Averages	46.50	50.87	42.63	47.03

If it is true, as was claimed in an article in the American Journal of Political Science. that "...elections are reasonably assumed to be battlegrounds in the struggle over income redistribution," those in favor of it have won. [Filer, Kenny, and Morton, 64] What has happened is that income has been redistributed by the Federal government in a way that is consistent with the belief that equity means redistributing the nation's income more equally between the states. This has meant that income redistribution has largely consisted of creating deficit states in the North and surplus states in the South and West. Whether or not this is equitable depends upon one's definition of equity. Determining whether or not this redistribution contributed to the creation of the "Rust Belt," as some have claimed, is beyond the scope of this article.

It is difficult to determine to what extent citizens and politicians care for distributive equity as a public good. The outcome of an election may not mirror accurately the position of the average citizen simply because many people do not vote. Also, it is no secret that political parties attempt to get state legislatures to draw district boundaries in a way that will maximize the number of seats in Congress they can capture with a given number of voters. If, for example, a state with four House districts had 520,000 likely Republican voters and 480,000 likely Democratic voters, what the Democrats would benefit the most from would be districts like the following.

Because voters are intermingled and districts have to be contiguous (but not compact!), the extreme example above is not reasonable even in a state where one party dominates the legislature and has the governorship. The limitations that the geographic distribution of voters and the failure of people to go to the polls may impose is illustrated in Georgia where, despite the governor being a Democrat and Democrats outnumbering Republicans in both houses of the legislature, Republicans fill a majority of the State's seats in the U.S. House of Representatives. However, the hypothetical example above illustrates how a state's Congressional delegation in the House (but not the Senate because senators represent the entire state) could be out of step with the wishes of the average voter. This means that voters who feel they benefit from income redistribution (or vice versa) could have a disproportionate voice in Congress. (People with the most to gain or lose from income redistribution are, presumably, the ones most likely to vote .)

The fact that Washington takes more from a state than it spends in it does not mean that each and every Congressional district in that state is running a deficit with Washington. It is certainly possible that some of a deficit state's districts run a surplus in Washington. In states that are very heterogeneous, and whose common interest groups are not randomly distributed geographically, it seems likely that some districts would oppose, while others would support income redistribution.

The data examined in this article indicate that Congressional delegations of both groups of states and the members of each state's delegation are rather heterogeneous in terms of how they vote. The data shown in this article do not suggest that, as a whole, the Congressional delegations in the deficit states seek to prevent or those in the surplus states seek to cause income to be redistributed by the Federal government from higher income states to lower income states. However, it is possible that a senator or representative who usually votes "conservative" on economic and non-economic issues that do not involve income redistribution vote "liberal" on the relatively few bills that will send money into their state and vice versa. It is possible, too, that votes that led to inter-state income redistribution through procurement and salaries and wages might not be classified as "liberal" votes because income redistribution is not their intended and/or obvious purpose. Further research is needed to determine whether the data considered in this article is a valid indicator of the objectives of senators and representatives relative to income redistribution.

Barone, Michael and Grant Ujifusa, The Almanac of American Politics (published annually).

Dixit, Avinash and John Londregan, "Ideology, Tactics, and Efficiency in Redistributive Politics," Quarterly Journal of Economics (May 1998), pp. 497-529.

Filer, John E., Lawrence W. Kenny, and Rebecca B. Morton, "Redistribution, Income, and Voting," American Journal of Political Science (February 1993), pp. 63-87.

Jhun, U-Jin and James Cicarelli, "Regionalism, Redistribution, and Federal Spending," Nebraska Journal of Economics & Business (Autumn 1978), pp. 29-36.

Mathews, Don, "Does an Unequal Distribution of Income Justify Government Redistribution?" The Journal of Private Enterprise (Fall 1998), pp. 68-85.

Rogers, David, "Lott, Cochran Don't Let GOP Ideals Stand in Way of Helping Their State," The Wall Street Journal Interactive (March 6, 1998).

Siegel, Fred, "New York City, A Once-great Economic Colossus Is Destroying Its Private Sector to Finance a Make-work Social-service Economy," Policy Review (September/October 1997), pp. 21-27.

Walder, Jay H. and Herman B. Leonard, The Federal Budget and the States, Fiscal Year 1996, Tubman Center for State and Local Government, John F. Kennedy School of Government, Harvard University, 1997.

Walder, Jay H. and Herman B. Leonard, The Federal Budget and the States, Fiscal Year 1997, Tubman Center for State and Local Government, John F. Kennedy School of Government, Harvard University, 1998. Cited portions of this Web document are:

Weiner, Stuart E. and Stephen A. Monto, "Income Inequality: A Summary of The Bank's 1998 Symposium," Economic Review, Federal Reserve Bank of Kansas City, Fourth Quarter 1998, pp. 1-11.

Alesina, Alberto and Howard Rosenthal, Partisan Politics, Divided Government, and the Economy, 1995.

Barone, Michael and Grant Ujifusa, The Almanac of American Politics (published annually).

Barro, R. J., "On the Determination of the Public Debt," Journal of Political Economy (October 1979), pp. 940-971.

Becker, G. S., "Public Policies, Pressure Groups, and Dead Weight Costs," Journal of Public Economics (December 1985), pp. 329-347.

Brennan, Geoffrey, Democracy and Decision: The Pure Theory of Electoral Preference, 1993.

Buchanan, James M., "Positive Economics, Welfare Economics, and Political Economy," in Rowley, Charles K., ed., Public Choice Theory, Volume 1: Homo Economicus in the Political Marketplace, 1993.

Buchanan, James, "Individual Choice in Voting and the Market," in Charles K. Rowley, ed., Social Choice Theory, Volume 1: The Aggregation of Preferences, 1993, pp. 428-437.

Buchanan, James, "Rawls on Justice as Fairness," in Charles K. Rowley, ed., Social Choice Theory, Volume 3: Social Justice and Classical Liberal Goals, 1993, pp. 75-80.

Christainsen, Gregory B., "James Buchanan and the Revival of Classical Political Economy," Challenge (March/April 1988), pp. 11-15.

Coughlin, Peter J., "Redistribution via Government and Distributive Justice," University of Maryland Department of Economics Working Paper: 14-5 (April 1994).

Cox, Gary and Matthew McCubbins, "Electoral Politics as a Redistributive Game," Journal of Politics (1986), pp. 370-389.

Danziger, Sheldon, Robert Haveman, and Robert Plotnick, "How Income Transfer Programs Affect Work, Savings, and the Income Distribution: A Critical Review," Journal of Economic Literature (September 1981), pp. 975-1028.

Dixit, Avinash and John Londregan, "The Determinants of Success of Special Interests in Redistributive Politics," Journal of Politics (1996) pp.1132-1155.

Dixit, Avinash and John Londregan, "Fiscal Federalism and Redistributive Politics," Journal of Public Economics (May 1998), pp. 153-180.

Dixit, Avinash and John Londregan, "Ideology, Tactics, and Efficiency in Redistributive Politics," Quarterly Journal of Economics (May 1998), pp. 497-529.

Dixit, Avinash and John Londregan, "Redistributive Politics and Economic Efficiently," American Political Science Review (1995) pp. 856-866.

Feldstein, Martin, "Can State Taxes Redistribute Income?" Journal of Public Economics (June 1998), pp. 369-396.

Filer, John E., Lawrence W. Kenny, and Rebecca B. Morton, "Redistribution, Income, and Voting," American Journal of Political Science (February 1993), pp. 63-87.

Hands, Douglas, "Answering the Old Questions in New Ways: Economics in the Last 15 Years," Business Horizons (July/August 1982), pp. 38-44.

Jhun, U-Jin and James Cicarelli, "Regionalism, Redistribution, and Federal Spending," Nebraska Journal of Economics & Business (Autumn 1978), pp. 29-36.

Johnson, William R., "Income Redistribution in a Federal System," American Economic Review (June 1988), pp. 570-573.

Marshall, Jerry L., Greed, Chaos, and Governance: Using Public Choice to Improve Public Law, 1997.

Mathews, Don, "Does an Unequal Distribution of Income Justify Government Redistribution?" The Journal of Private Enterprise (Fall 1998), pp. 68-85.

Norton, Rob, "Why Federal Programs Won't Die," Fortune (August 21, 1995), p. 35.

Orchard, Lionel, "Public Choice," Cambridge Journal of Economics (May 1997), pp. 409-430.

Pasour, E. C., Jr., "Economics and the Public Policy Process: What Can Economists Do?" New Zealand Economic Papers (June 1993), pp. 1-17.

Peltzman, Sam., "The Growth of Government," Journal of Law and Economics (October 1980), pp. 209-287.

Peltzman, Sam, "Voters as Fiscal Conservatives," Quarterly Journal of Economics (May 1992), p. 327-361.

Reading , Don, "New Deal Activity and the States, 1933-1939," Journal of Economic History (1973), pp. 792-810.

Roberts, Paul Craig, "Idealism in Public Choice Theory," Journal of Monetary Economics (August 1978), pp. 603-615.

Rogers, David, "Lott, Cochran Don't Let GOP Ideals Stand in Way of Helping Their State," The Wall Street Journal Interactive (March 6, 1998).

Samuels, Warren J., "Toward Positive Public Choice Theory," Review of Social Economy (April 1980), pp. 55-64.

Saving, Jason L., "Tough Love: Implications for Redistributive Policy," Economic Review, Federal Reserve Bank of Dallas (Third Quarter 1997), pp. 25-29.

Seiglie, Carlos, "Deficits, Defense, and Income Redistribution," Cato Journal (Summer 1997), pp. 11-21.

Stigler, George, "Director's Law of Public Income Redistribution," Journal of Law and Economics, (1970), pp. 1-10.

Tam, Mo-Yin S. and Renze Zhang, "Ranking Income Distribution: The Tradeoff Between Efficiency and Equality," Economica (May 1996), pp. 239-252.

Thurow, Lester C., "Income Distribution as a Pure Public Good," Quarterly Journal of Economics (May 1985), pp. 327-336.

Weiner, Stuart E. and Stephen A. Monto, "Income Inequality: A Summary of The Bank's 1998 Symposium," Economic Review, Federal Reserve Bank of Kansas City, Fourth Quarter 1998, pp. 1-11.

Wright, Gavin, "The Political Economy of New Deal Spending: An Econometric Analysis," Review of Economics and Statistics (1974), pp. 262-281.

Surplus States	Population	Deficit States	Population
New Mexico	1,655	New Jersey	7,903
Mississippi	2,670	Connecticut	3,275
Virginia	6,551	Illinois	11,759
West Virginia	1,824	Michigan	9,492
Missouri	5,279	New Hampshire	1,135
Montana	856	Minnesota	4,568
North Dakota	639	Wisconsin	5,083
Alabama	4,220	Delaware	708
Hawaii	1,178	Nevada	1,462
Maryland	5,000	New York	18,153

Kind of spending	Average, surplus states	Average, deficit states
Direct payments to individuals	$2,902	$2,523
Grants to state & local governments	$955	$792
Procurement	$1,126	$386
Salaries and wages	$878	$230
Other Federal spending	$327	$134

Kind of spending	Total, surplus states	Total, deficit states
Direct payments to individuals	$29,017	$25,225
Grants to state & local governments	$9,554	$7,916
Procurement	$11,261	$3,864
Salaries and wages	$8,783	$2,295
Other Federal spending	$3,274	$1,335

District	Democratic voters	Republican voters
1	0	200,000
2	160,000	106,666
3	160,000	106,666
4	160,000	106,668

Surplus State	Change	Deficit State	Change
New Mexico	11.2	New Jersey	2.8
Mississippi	4.7	Connecticut	-0.4
Virginia	6.9	Illinois	3.5
West Virginia	1.9	Michigan	2.7
Missouri	4.0	New Hampshire	3.5
Montana	8.9	Minnesota	5.3
North Dakota	0.4	Wisconsin	4.7
Alabama	5.3	Delaware	7.7
Hawaii	7.1	Nevada	27.3
Maryland	5.5	New York	0.8

District	Party	Median Household Income	Percent White
1	R	$45,464	89
2	R	$50,076	79
3	R	$56,060	91
4	R	$50,887	74
5	D	$50,103	79
6	D	$36,223	23
7	D	$30,324	58
8	D	$32,784	74
9	D	$34,758	82
10	D	$23,164	21
11	D	$26,148	16
12	D	$20,444	14
13	R	$38,437	82
14	D	$42,184	80
15	D	$19,238	14

District	Party	Percent Conservative Votes
1	R	82
2	D	1
3	D	NA
4	R	55
5	R	56
6	D	9
7	D	NA
8	D	0
9	D	20
10	D	4
11	D	NA
12	D	NA
13	D	15
14	R	64
15	R	49
16	D	2
17	D	10
18	D	5

District	Party	% White	% Rural	Per Capita Income
1	R	70	34	$10,961
2	R	75	42	$11,636
3	D	73	47	$10,204
4	D	92	66	$10,170
5	D	83	39	$13,268
6	R	90	23	$16,033
7	D	32	27	$8,135

District	Party	Median Household Income	Percent White
16	D	$15,060	4
17	D	$27,227	29
18	D	$43,754	74
19	R	$50,239	86
20	R	$47,107	83
21	D	$31,489	90
22	R	$33,306	96
23	R	$26,155	95
24	R	$25,687	95
25	R	$31,080	90
26	D	$30,335	88
27	R	$34,573	92
28	D	$33,899	80
29	D	$28,951	91
30	R	$26,263	81
31	R	$25,124	95

District	Party	Percent Conservative Votes
1	R	55
2	R	56
3	R	55
4	D	NA
5	D	28
6*	D	18
7	D	21
8	D	0
9	D	28
10*	D	0
11*	D	0
12*	D	0
13	R	73
14	D	15
15*	D	0
16*	D	11