Feast or Famine at the Federal Luau? Understanding Net Federal Spending under Bush

Abstract

During the 2000 election, 30 "red" states cast their Electoral College votes for Republican George W. Bush. Many of these red states are also the largest net recipients of federal benefits. Is this a product of the fact that many red states are simply poorer than blue states, or the result of political machinations? We find that even after controlling for Republican congressional power and key socio-economic and demographic factors, red states received more federal benefits per tax dollar in 2004. In a twist of irony, we conclude that "big government" entitlement and discretionary programs have actually become important club goods for Republicans to reward support in core states. As a result, red states have increased the amount of goods they received per tax dollar under Bush.