Feds Squeeze New Jersey to Benefit Kentucky

In New Jersey the Rich Get Richer -- And Then There's the Rest of Us

The following information, provided by Vincent Conti, indicates the funds provided by the states to the federal government and the amount received in return. Although this information may not be of interest to those in all states, it certainly is interesting to those in the states that give the most to the federal government and receive the least. As Conti put it, the data indicates that the “feds squeeze New Jersey to benefit Kentucky.”

The Rockefelller Institute of Government has just released its 2019 study on the balance of payments between the federal government and individual states. New Jersey has the second worst balance of payments ratio in the country — 49th out of 50 states.

The study looks at what is collected by each state and federal revenues and what is spent in each state as part of federal expenditures. Some states get more than they pay to Washington while others pay much more than they get back. For New Jersey, the report states that the gap is a negative $21.3 billion.

The report lists 40 states with positive balance payment numbers and 10 are sending much more to the federal government than they are seeing in federal spending. The top three states with the worst balance of payment numbers include New York, New Jersey and Massachusetts. The states with the best are Virginia, Florida and Kentucky.

Virginia’s data is explained in part by the large number of federal workers living near Washington. In the case of Kentucky, the federal dollars spent in grants and contracts is double the national average, paid in part with that extra $21 billion coming from New Jersey.

Kentucky’s balance of payments with the federal government is a positive $40 billion.