The dependent states of America
“Washington’s volatility is the new normal, the question is whether states are positioned to withstand it,” write Jennifer Butler and Tony Woodlief in a new Center for Practical Federalism policy brief on state dependency.
A few key takeaways:
That year, the federal government disbursed $1.05 trillion to states. A closer look at the numbers reveal:
- The average state relied on federal sources for 37% of its revenue—double the 1990 average.
- State dependency remained almost as high in 2023 as during the peak Covid stimulus years.
- 23 states now get a higher proportion of their budgets from federal dollars than they did
during pandemic lockdowns. - Every state but Idaho and New Mexico received a higher share of revenue from the federal
government in 2023 than pre-pandemic. - Four states—Virginia, New Hampshire, Oklahoma, and Rhode Island—saw double-digit increases.
The full report is worth reading, especially the recommendations for how states can strengthen their fiscal independence and resilience.
— The Federalism Beat