On Television: Why Is North Dakota Spending Twice As Much As South Dakota?

On my weekly segment with Chris Berg on Valley News Live last night we discussed this recent SAB post from Mike Marcil comparing South Dakota’s government with North Dakota’s. In his post, Marcil points out that South Dakota’s government is a lot more lean than North Dakota’s, and taxes are significantly lower.

In fact, Berg took some of the data from Marcil’s post and created this eye-opening graphic:

If you’re wondering, the gap between tax collection and the overall budget is federal dollars. Also, the spending figure contains money spent from the state’s special funds that collect revenues which don’t necessarily go through the general fund.

But what we really want to pay attention to is the per-capita spending. South Dakota’s spending is roughly half of North Dakota’s. That’s a significant difference for states that aren’t all that different.

South Dakota’s population in 2013 was 833,354. North Dakota’s population was 723,393. Geographically, both states are very similar. The same for issues like demographics. Both states have very strong, energy- and agriculture-based economies. Yet, for some reason, South Dakota’s government is a lot smaller than North Dakota’s.

That’s significant. As I explained in the segment, it may be why South Dakota has managed to consistently rank alongside North Dakota at the top of positive economic measures like economic growth, low unemployment and income growth.

Except, South Dakota has managed to do it without an oil boom.