Republican States Run Surpluses, Democrat States Run Deficits

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One of the wonderful things about our federalist system of government is that our states can act as “laboratories of democracy,” as Supreme Court Justice Louis Brandeis put it. Which is to say, each state can address policy issues in different way, with observable differences in results.

It’s interesting to apply that to fiscal issue. At the national level, and in Democrat-controlled states, fiscal matters are a mess. In Republican states, things are much more orderly:

According to the Congressional Budget Office, the federal government posted a $293 billion deficit in the first fiscal quarter of 2013, setting the Obama administration up for a record fifth-year of trillion dollar deficits. But while the fiscal condition of the Democratically controlled federal government is still atrocious, Republican controlled states are now swimming in surpluses.

Thanks to a Republican governor committed to developing its natural resources, not punishing entrepreneurs who do, Texas legislators are facing an $8.8 billion surplus over the next two years. To the east, Republican governors Bill Haslam of Tennessee and Rick Scott of Florida have also turned recession deficits into budget surpluses. Moving north, Michigan’s Gov. Rick Snyder, Iowa’s Gov. Terry Brandstad, and Indiana’s out-going-Gov. Mitch Daniels, also can now all boast surpluses in the hundreds of millions of dollars. All of these governors managed to turn their state’s fiscal situation around through spending cuts, not tax hikes. Now their budgets are in the black and their economies are growing.

Things do not look as good in Democrat-controlled states. Illinois, who massively raised taxes on the rich, still has a $5.9 billion stack of unpaid bills. California, who also raised taxes on the rich, was supposed to post a small surplus this year. But tax collections are coming in at 10.8 percent below budget projections. As a result, the state is now projected to be $1.9 billion in the red by the end of this fiscal year.

Of course, things aren’t quite as simple as this. In North Dakota, another Republican-controlled state running a big budget surplus, Republicans have been anything but fiscally restrained. Since 2003 the state’s budget has increased by 156%. We’re running a surplus because, thanks to the state’s oil boom, revenues are growing even faster than spending.

But in general, this speaks volumes about what works and what doesn’t in terms of getting finances in line. What works is spending cuts, and tax reductions. What doesn’t work is spending and tax hikes.

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • Emil Kashuntz

    Of course states like North Dakota send one dollar to the federal government and get back two. If the red states were not on welfare they would be in a world of hurt. Excellent distortion

    • jl

      Sorta like the bottom 50% who send nothing in and get a whole lot back.

    • igx

      WE HAVE TOO MUCH CENTRAL GOVERNMENT TRYING TO DO TOO MUCH. Plus part of that is where retirees go for the weather or cost of living.

    • noblindersonme

      I am glad you made that point Emil because I was about to do the same. Of course the narrow mind of port does not see such things or worse yet, just ignores them
      A while back there was a congressional report , pretty much exactly like the one smart *ss port is using now to preen and attempt to rub the ‘liberals ‘ nose in , except any stories that don’t prop up his prejudices , as I said , are ignored. That congressional report showed that it is the red states that ( I am paraphrasing ) lead in personal dependency on federal welfare and federal monies. I will dig up the article because I save such stuff to refute the onesided idoicy port thrives on.
      tell us all smart *ss, isn’t that a good example of the’ laboratory of democracy!!’
      of course it is!!! But port doesn’t know his way around a laboratory let alone a factual debate. In a ‘laboratory ‘ there would be tests and experiments , ‘controls’ that would show how a result could be obtained with or without the item in question . In other words real intelligent research , but why bother with that when port’s standards are so low.
      Say why didn’t he ask or find it interesting that most ‘red states’ that accomplished surplus budgets were states that HAD BIG DEPOSITS OF OIL UNDER THEM or were states that were bolstered by strong agriculture . ??
      It’s not true in every situation But I’d like to see the smart *ss like port ,try to run state like Michigan for instance, and not have a Bakken to exploit .
      So what is the truth? red states run surpluses and are also the most dependent on the federal teat???
      or is the truth somewhere in the middle ?
      or maybe port doesn’t really give a damn about ALL the truth!!!

      • Stephen Zeigler

        So lets break this down into smaller bites….your saying the federal gov. should spend more money ? Just who’s money are you referring to ? If it’s my money, as I earned it, at what point does it become yours to tell me what should be done with it ?
        Anyone which needs to run a household should know the basic concept of a budget. Don’t spend what you don’t have.
        I would love to see all people have health insurance, the best doctors, to have a team of lawyers if ever needed ( O.J.) to have affordable houseing, etc……fact is WE can not afford such things.
        You liberals live in a fairy tale world of wants. You want everything controlled as to your order of thinking. Problem is: People are different, some need to be controled, some need no control< others work hard and yet some refuse to work, some give out love and others live full of hate. You can not and will not ever control people. WW1 and WW2 should teach you that.
        Should I tell you how and what to wear, what to eat, where you will work and for how long. Should everything in our lives be controlled by the sate and fed. gov's. Is this what you want ? This is what you have voted for and it's going to destroy our beloved country and the freedoms we hold so dear. In your blind desire, you have eaten the golden goose.

      • JoeMN

        So what is the truth? red states run surpluses and are also the most dependent on the federal teat???
        or is the truth somewhere in the middle ?

        http://www.theblaze.com/stories/2012/10/24/red-state-blue-state-who-receives-the-most-federal-funding-not-ready-hold-for-wed-am/

  • $8194357

    Rock bottom real estate for the islamic imigrant to scarf up…
    Dearbornistan?

  • Rip

    But, but, but, the Prez says we don’t have a spending problem. In fact, he’s tired of hearing about it.

  • borborygmi

    If memory serves me correctly the Republicans ran the legislature until 2012, So this deficit would be theirs still. I am sure that it was a minor oversight of yours Rob.

  • borborygmi

    Minnesota is looking at a budget shortfall thanks to Republican Legislature which were just kicked out.

    • boborygmi

      Conservatives just can’t handle the truth. Funny

      • Stephen Zeigler

        what truth ? Love to hear that one.
        How’s that unemployment thing going for you….news says it’s around 7. some percent…fact is..are should I say the truth of the matter is…..hold on now see if you can handle the truth…..16% to 17.5%…..oh no say it an’t so. Fact is OUR gov. can’t do math worth a dang. Both partys are guilty of this one. Once people drop off the roles of gov. support they are no longer counted as “unemployed” .Does not matter if they still do not have a job.
        Hows that budget comming along, been how long sence you put one out…what was that…..even the democratic congress voted down obama’s budget…that was 100% by the way…voted NO. His own party said no…and you still don’t get it….
        Tell me again about the high price of gas under GWBush….how he was using American’s to make a fortune in the oil industry. Had something to do with Iraq. Didn’t obama run on a policy to GET US OUT …..oppssss there’s that truth thingy again…..Oh…what a shame we are still there….what some 5 years later under lying o.
        Oh please….don’t say it’s going to take time….Ron Paul says they flew over they can fly them back…NOW.
        Lost your house yet ? Think Carter, and Clinton for that one, o just makes a bad thing worse. How many times did Bush tell them to shut down, disconnect , turn off the flow of money to Freddie and Fanny….hint it was 19 times he tried to get a democratic congress ( 2007 remember ) to stop the maddness. Barny fife say helll no all is fine…..CRASH BANG…..but you blame it on Bush. Why….because CNN and MSNBC told you to say that ( puppet come to mind ) Oh if you don’t know what Carter and Clinton had to do with the houseing crash….do more research….really ! Hint, Carter started it, Clinton had it enforced. Think of it like this, Carter was the pilot, Clinton was suppose to put gas in the plane….when it crash it came down on Bush……
        Plenty of documentaries to back it up. Facts.
        What a mess your making…..I ‘d say God help us…..but your not into that higher power stuff….so I’ll say it for me at least before you abolish free speech. God bless America..and please God help the liberals understand basic math…AMEN !
        p.s. Dear God, would you also remind liberals that killing unborn babies is still wrong, and 1000’s of babies die everyday in this country, and yet they cry havoc at the killing of school children.

  • Snarkie

    It’s probably because red states get more tax money back from D.C. than the blues. And they get more food stamps… etc. etc.

  • kevindf

    Budgets should balance. If they don’t, the people responsible should be sent to the private sector to earn a productive living.

    • Stephen Zeigler

      One might suggest they show the ability to do this BEFORE they go to congress. Unless of course your a community organizer, in which case you only need to show you can out spend all preceding presidents combined.

  • Dallas

    North Dakota has money because of lavish federal spending; Farm programs, Social Security, Federal Highway Funding, Medicare and Medicaide to name a few. We also have money because progressives passed Measure #6 in 1980 doubling the state’s oil extraction taxes. Without #6, we’d be a poor South Dakota with lots of bad roads and poor schools. Republican’s and their bankrupt policies having nothing to do with ND’s good financial situation. The State Chamber of Commerce, Republicans and the oil industry bitterly opposed #6.

  • http://twitter.com/dsjj251 Derrick Syl.James Jr

    Texas has a 10 billion dollar deficit for 2012, not a surplus, that predicted surplus over the next 2 years has already been revised down twice if i remember correctly.

    Florida is completely by Republicans and their deficit is 2.5 billion

    infact, 4 of the top 10 states when it comes to budget shortfalls are Republican( hold House, Senate and Governorship)

    Texas, Florida, North Carolina, and Ohio.

    Oregon until the election this year was evenly split in the house(30/30) and Senate(16 dem/14 GOP)

    another top 10 State, New Jersey has a Republican governor.

    also,

  • tuggs

    What I see here & what I know:

    Wisconsin is a democratic state, but we are out numbered with all the republicans running our state… & with all these republicans running this state it is the democrats who are responsible for the deficit here?… hummmm. .

    Doesn’t add up…..

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