Jun 5 2009, 10:51AM

Sarah Palin's Economics Lesson

Sarah Palin gave a speech about economics on Wednesday, but it only popped into my RSS reader last night:

"Some in Washington would approach our economic woes in ways that absolutely defy Economics 101, and they fly in the face of principles, providing opportunity for industrious Americans to succeed or to fail on their own accord," she said. "Those principles it makes you wonder what the heck some in Washington are trying to accomplish here."

Wow. Whatever else might be said about Sarah Palin, I hope we can all agree that there's absolutely no reason to take her seriously as a fiscal conservative. In particular, that line about "industrious Americans" succeeding and failing of their own accord made we want to take a look at the federal dollars Alaska receives per resident relative to its federal tax burden. So I went and made this chart:

alaska taxes and spending.png(This is drawn from the right-of-center Tax Foundation using their most recent data.)

Alaska gets $13,950 per resident from the federal government, more than any other state in the nation. It ranks number one in taxes per resident and number one in spending per resident. It's also number one in pork-barrel spending. Each Alaska resident receives a check for $3,200 a year from state oil revenues -- which Palin bumped up from $2,000 last year. Palin once justified this by saying that the state of Alaska was "set up, unlike other states in the union, where it's collectively Alaskans own the resources. So we share in the wealth when the development of these resources occurs." (Sounds socialist!) Industrious indeed.

(A housekeeping note: I like both charts and gimmicks, so I thought one possible gimmick for this blog would be to create a "chart of the day" and publish it at a regularly appointed hour, like 10am every weekday morning. I am curious to know if [1] this is a stupid idea and [2] if anyone has any suggestions for cool charts to make.)
 

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Comments (47)

i have to question this blog post when you say "I hope we can all agree that there's absolutely no reason to take her seriously as a fiscal conservative". i would of thought that we should not take her seriously at all, fiscal conservate or not.

ZXDrew (Replying to: pete776)

So what you graph actually shows is:
a.) People in Alaska don't make much money so the taxes they pay are lower
b.) Something other than a person (i.e. a company, maybe an oil company) pays a higher proportion of the taxes
c.) Federal spending for wildlife reserves is high
d.) Federal spending for "other" programs (save the animal/land)
e.) Just because you can create a graph doesn't mean you can interpret one correctly

I think the idea of a daily chart or graph is great. I think graphs going counter to conventional wisdom are always illuminating. Personally, I would be interested in a graph illustrating the pension crises in CA, IL, NY, etc.and maybe forecasting how long we have until the issue comes to a head in different states.

i would of thought that we should not take her seriously at all, fiscal conservate or not.


I suppose I take her seriously as "a force in the culture wars," but point taken

Conor


she's the duly elected governor of Alaska - she is to be taken as seriously as any other governor, certainly as seriously as the governor of California or New York or Alabama for that matter. You can point out her hypocrisy or criticize her as you would any other governor. There's a certain dismissive attitude towards her that is blatantly sexist.

J. Fred Smug (Replying to: brooklyn)

Sorry, "brooklyn," but there are more people in San Francisco (more than 800,000) than in Alaska (less than 700,000). I'll be generous and take Sarah Palin as seriously as I take SF's Mayor Gavin Newsom.

market karma

the Federal spending per resident is driven by a few factors:

1. Alaska has a low base of residents -- 660k or so, which makes it one of the smallest in the US.

2. Alaska has lots of things of Federal interest -- namely military bases.

3. And of course, Uncle Ted Stevens certainly did leave his legacy

John Thacker
Whatever else might be said about Sarah Palin, I hope we can all agree that there's absolutely no reason to take her seriously as a fiscal conservative.

Whatever else might be said about Sarah Palin, I hope we can all agree that she has had but the tiniest effect on how much taxes Alaskans pay to the federal government, and how much Alaska gets in spending from the federal government. Far more of the blame, I suppose, would lie with the state's (largely Republican) political establishment-- like former Senator Frank Murkowski, defeated as governor for re-election in a primary by Palin, or Representative Don Young, nearly knocked out in a primary by Palin's lieutenant governor Parnell. Yet that is the basis of your chart and of your refutation. She's not allowed to be a fiscal conservative unless she singlehandedly manages to reject the great majority of federal pork barrel spending to Alaska, overturning decades? In a manner which the South Carolina Supreme Court recently decided that Mark Sanford was not allowed to do? How mendacious.

It's like the repeated claims that fiscal conservatives are somehow not hypocritical if they represent poor states, since by our federal system poor states will always receive more taxes than they pay.

MOswingvoter

Conor, this chart is appalling. You look at data through 2005. Sarah Palin was elected in 2006. How about looking at what she's done since she took office instead of blaming her for Murkowski's mistakes?

I can't help myself from feeling that this is a bit disingenuous. Palin had nothing to do with federal tax outlays from 1981-2005 unless she held much more sway than we recognized as Mayor of Wasilla. That said, she is definitely no fiscal conservative, and is nothing more than a cynical (unintended, and seemingly unending) punchline.

Awesome work on the blog though, I've really enjoyed reading it and love the idea of a chart/graph of the day.

William Ahern

We had been producing that study annually for decades when Census delayed publication of its annual Consolidated Federal Funds Report (http://www.census.gov/govs/www/cffr.html) for almost two years. That's where the spending data comes from. Then they caught up to their usual schedule with rapid-fire publication of two issues (FY 2006 and 2007), and the FY2008 report is expected soon. Meanwhile, economist Curtis Dubay, the author of our ratio reports for FY 03, 04 and 05, left Tax Foundation for PriceWaterhouseCoopers, and we just never got back to that project. That's a long way of explaining why, Conor, you're getting grilled for grilling Palin with irrelevant FY 2005 data.

Mr. Thacker has made the most cogent point. Governors, state budgets and state taxes have almost nothing to do with this federal tax-to-spending ratio. Federal transfer programs and defense make up the vast majority of the huge federal spending flows -- and these expenditure levels are determined by demographics and national security. The reasons so-called red states are "beneificiary states" while blue states are "donor states" is mostly that red states have more poor people, and the rich people in blue states pay most of the income tax. (In 2011 they'll be paying even more and the ratios in NY, CT, NJ, IL and CA will nudge down even further.)

As for Ted Stevens, he and WV senator Byrd are probably the exceptions that prove the rule. They did drag comparatively enormous federal spending back to their small-economy states over the 20 years during which they handed the chairmanship of Appropriations back and forth.

Bridge to Nowhere anyone? How easy it is to forget that big lie about saying "Thanks but no thanks." More like "Thanks for the money, we'll be spending it elsewhere, we don't really need the bridge!"

Fiscal conservative? Please!

And as far as the years encompassed by this graph, I can tell you that the pork has continued to flow into Alaska in copious quantities, and the governor has spent it as she pleased, not as most benefitted Alaskans.

section9 (Replying to: AKWren)

And yet if you look at Palin's earmark requests, they have gone down in each of her budgets.

Meantime, has your brow furrowed about Obama's multi-trillion dollar budget blowout?

Crickets are chirping!!!!

Justin Tyme

Palin's federal tax mistake aside, let's not overlook a key point in her message: don't let government intervene by stopping companies from failing ("...they fly in the face of principles, providing opportunity for industrious Americans to succeed or to fail on their own accord.").

Anybody care to guess how quickly Gov. Palin would reverse her argument if the industry that supports her entire state (oil) were to start talking bankruptcy?

Conor, love the blog and agree with the post. I do need to correct you on the amount of oil dividends we receive, though. Last year's was much larger due to a $2,000 increase from Palin for energy cost offset. This had nothing to do with oil dividends, though the funds were combined in the same check.

The point still holds that no one can claim to be a fiscal conservative while handing out $2 billion (the same amount as our budget surplus last year) to cover energy costs. That $2 billion happens to be about what our budget deficit is now.

simon (Replying to: simon)

Er, $1,200 increase. My bad. We get so much money I can't keep track of it.

C. William Chattin

Conor, this may warrant consideration for Most Pwn3d Blog Item of the Year (MPBIY).

MOswingvoter provides the most obvious shortcoming: your chart ENDS in 2005 -- virtually two years before Palin became governor. John Thacker only piles on by pointing out that the governor of Alaska has virtually no say in the federal taxing of, and spending in, Alaska. William Ahern (one of the authors of the underlying data) follows up: state governors "have almost nothing to do with this federal tax-to-spending ratio. Federal transfer programs and defense make up the vast majority of the huge federal spending flows -- and these expenditure levels are determined by demographics and national security." And, as a final insult from market karma, Alaska has (by far) the lowest population-to-area ratio of any State -- making spending-to-tax revenue all the more likely.

In sum, this chart shows nothing more than that Murkowski and Stevens are, and for 25 years have been, crooks; but it says nothing about Sarah Palin who did not take office as governor until December 2006 -- 23 months AFTER the cutoff of data on that chart, which has absolutely nothing to do with state budgetary matters in any event.

You've been pwn3d. Sorry. ;-(

President Obama Analysis at ObamaPundit.com

alaskamountainman

I'll have to say that after three years of Palin being our governor and watching the news regarding how she pads her expense account (trips for her kids, dollars for staying in her own home, clothes, ect.), all at the expense of someone else, she is in fact a fiscal conservative. With her money....not anyone else's!

TwinsForTruth (Replying to: alaskamountainman)

alaskamountainman - you do have to get out more - sounds like you have a good ole fashioned case of cabin fever. You didn't wake up with this illness - where are you getting all your information that has so distorted your brain? I know what the answer is but wondering if you would be so kind as to confirm my suspicions.

Valley Independent (Replying to: TwinsForTruth)

As a Wasilla resident, I'd say alaskamountainman is right on. Thanks to one of the citizen ethics complaints Palin likes to whine about so much, she has until the 23rd of June to pay the state back about $10,000 for trips for her kids that had nothing to do with state business (this after her going back and altering the original trip reports to claim it). She took 312 days out of about eighteen months of per diem for living in her own home, which is less than 50 miles from Anchorage, and for which other commuters, including other state employees, receive nothing. The $1200 payout per person last year for "energy assistance" to every man, woman, and child did not get the assistance where it was most needed, did not have any lasting positive effects on energy usage or cost, and was nothing more than a very expensive ploy to buy our votes just before the election. Add to that her track record as Wasilla mayor, and it's absolutely clear she is no fiscal conservative and is lacking in ethics, to boot.

For those who are interested, here is an LA Times article on that $10,000.

alaskamountainman

I'll have to say that after three years of Palin being our governor and watching the news regarding how she pads her expense account (trips for her kids, dollars for staying in her own home, clothes, ect.), all at the expense of someone else, she is in fact a fiscal conservative. With her money....not anyone else's!

naughtymonkey

Palin is still good for the media, as she meets the consumers'needs in so many ways. Comic opera, psychological case study, the list is endless.

I can't fathom why the team scarahs and C4pee ers get such an orgasmic rush from her. Maybe they will flock to this site to pillory me in the comments section, but hey, I enjoy cheap entertainment.

Love the graph idea. Here's a resource for starters--
http://graphjam.com/

My fave from their site--
http://graphjam.com/2009/02/19/song-chart-memes-palin-president/
Above graph--People Who Want Sarah Palin to Run for President in 2012 Graph attributed to Brad Kimmel


She likes the Way France does things for the little people
Since everyone or almost Everyone knows france is a Socialist Country we should be thanking Sarah for her wonderful foresight.

Audio
http://www.youtube.com/watch?v=CcEiR01QK7o

Partial Transcript
http://politicalhumor.about.com/od/sarahpalin/a/palin-prankcall.htm

AVENGERS: Yes, yes, I understand we have the equivalent of Joe the Plumber in France. It's called Marcel, the guy with bread under his armpit.

PALIN: Right, that's what it's all about, the middle class and government needing to work for them. You're a very good example for us here.

AVENGERS: I see a bit about NBC, even Fox News wasn't an ally as much as usual.

PALIN: Yeah, that's what we're up against.

AVENGERS: Gov. Palin, I love the documentary they made on your life. You know Hustler's Nailin' Paylin?

PALIN: Ohh, good, thank you, yes.

AVENGERS: That was really edgy.

PALIN: Well, good.

AVENGERS: I really loved you and I must say something also, governor, you've been pranked by the Masked Avengers. We are two comedians from Montreal.

PALIN: Ohhh, have we been pranked? And what radio station is this?

AVENGERS: CKOI in Montreal.

PALIN: In Montreal? Tell me the radio station call letters.

This Brainless Thinking was Six Minutes of pure pathetic cluelessness By Sarah Palin.

At the very end She says to someone in the Background that the Call was from

"Montreal, France"

Although I may not share them, I can certainly understand many of the negative reactions to Palin. I can understand people not liking Palin's politics. I can understand people not considering her experienced enough to be President and by extension therefore Vice-President. I can understand people not liking her "folksy" speaking style. What I cannot understand is the insistence the she is simply incompetent across the board.

I live in New Jersey; my state is functionally bankrupt. But Joe Biden and apparently every other Democrat in the United States think it would be great if we re-elected Corzine as governor. As far as I know, Alaska is reasonably solvent yet its governor is considered a dead loss. I am forced to assume that the definition of "competence" is not what it used to be.

Of course there are sexist elements in the reaction to Palin but I do not believe they fully explain the insistence on her incompetence despite her history. I tend to ascribe that more to class-ism.

As for her being spoofed by the comedians, so were a number of other people including Jaques Chirac. Furthermore, I actually think she did quite well considering the circumstances of the call. I cannot hear clearly what she was saying at the end - it sounded to me more like "Montreal, not France" but it's too fuzzy for me to be sure - but even if she said “Montreal, France” I do not think that’s any more serious an error than Obama’s claim there were 57 states - or any more worthy of attention. I am sure however that the comedian making the call said at the end, "If one voice can change the world for Obama, one Viagra can change the world for McCain."

You seem to think there is a difference between (a) the state capturing windfall profits with an oil tax and redistributing it with a lump sum transfer per capita and (b) the state deciding "to keep it and spend it."

I think there is a huge difference. The first alternative puts decisions about how to spend the money directly in the hands of individuals. The second lets the government decide how to spend the money. Yes, the government is the representative of the people but their spending decisions must necessarily be a blunt instrument in comparison to the millions (okay, in Alaska “hundreds of thousands”) of individual spending decisions made by individuals. We can certainly argue about whether the taxes should have been collected in the first place - I don't know enough about the situation to have a firm opinion - but this “who decides on spending” distinction is in some ways the heart of the difference between liberals and fiscal conservatives. Fiscal conservatives believe spending decisions are best made by individuals; liberals believe they are best made by the government.

An easy way to think of this is to consider alternative approaches to the stimulus. We passed a $787 billion stimulus bill. All that money will be spent as the government dictates - mostly the Federal government, to some extent State and local governments. We could instead have decided to forego collecting individual income taxes for 2009 at an estimated cost of $953 billion and let the individuals who kept that money decide how to spend it. (If the extra $166 billion bothered us, we could have collected enough taxes on those in the top tax brackets to make up the difference.)

The most interesting thing about Sarah Palin is that the 2008 Presidential race is over; the 2012 Presidential race is nowhere in sight; we have no idea if Palin will run in 2012 and if she does, whether she’d make any headway; and Palin is the governor of a state that is tiny in population terms and far, far away from the rest of the country. And yet we’re talking about her.

TwinsForTruth

Conor, you are nothing but a closet democrat hiding behind the freedom of the press posing as a so called journalist.

To all you Palin haters - all you know how to do is attack - that's all you have done for the past 8 1/2 years. You had better start boning up on your defense. There's a new boat in the harbor and he has a fleet. While you are all worried about Sarah your federal government is about to take total control of your lives. Question for you all - how much of your incomes are you willing to give via income tax and is your budget prepared for higher energy bills to ensure that Oprompter and his policies are a success? And don't just be thinking about yourself - what about all the middle class that are struggling today and cannot afford one more dime of any kind of tax - not to mention if they even have a job in the first place.

Valley Independent (Replying to: TwinsForTruth)

TwinsForTruth, why is it that the vast majority of Palin's followers, including you, to have an inability to provide rational arguments backed by facts to support your positions or those of Palin?

Why do you automatically assume that those who do not support her actions or policies "hate" her? Have you never disagreed with something a friend did or said, but still liked the friend?

Why do Palin's followers automatically assume that anyone who disagrees with her agrees with everything Obama says and does? This would be a very wrong assumption on your part.

Why do Palin's followers assume that bad behavior by Democrats and other non-Republicans are okay with us? It's not, nor do we buy the argument that just because someone else did the same or worse, it's okay for Palin to behave that way. We aren't looking for the lowest common denominator here, we want the best and the brightest.

Funny that you should mention higher energy bills. Alaskans are already experiencing high energy costs, and we aren't expecting them to go down, which makes it all the more ironic that Palin is turning away $28.6 million we could use for weatherization or renewable energy and that would create jobs in the process. Stranger still is that she is taking money for unemployment benefits extensions, which does nothing to create jobs or provide any lasting positive impact.

For the record, I AM the middle class struggling today, and the reason I am struggling so much is eight years of Bush/Cheney/Rove, who, as you might recall, thought a war under false pretenses and a $700 billion bank bailout with almost no oversight were good ideas.

I am an old-style Republican: fiscally conservative, pro-business, and anti-government interference in people's personal lives. I am no longer a member of the party because I don't care to be associated with people like you and Palin.

TwinsForTruth (Replying to: Valley Independent)

Valley Independent,
It looks like we agree that both republicans and democrats need to go - I think - please confirm my assumption. If so, who is the party that will lead? Who are you going to vote for?

Leif Arne Storset

While the body of Conor's blog post does deal with socialism (the oil check), the graph actually illustrates not socialism, but a different ideology. Not sure what it's usually called, but it is a policy of boosting rural areas, and in this case it happens at the federal level.

As commenter market karma explains, Alaska is a small state with high federal interest (as well as Ted Stevens in the Senate), and this is what leads to increased federal spending there more than socialism per se.

The same thinking provides an argument for certain aspects of the Electoral College (see Wikipedia, 1, 2) that give more weight to small states in order to prevent large states from dominating the Union. This is not socialism, although you could argue that this policy is ideologically related and requires socialism in order to function.

I'd like to see that graph presented for every state with a relatively low population to senator ratio.

Or better yet, a plot of current "federal deficit per person" by "state population". The Senate is broken - each state has an equal say, regardless of population. That's how the residents of larger states get fleeced by smaller states in the federal budget.

Charles from Toronto

I think the idea of a chart of the day is wonderful.

Can you give any consideration to posting it at 8:00 AM every day; in that way we can also see the effects on the stock market as it would be there before trading starts.

I think some edgy charts showing things like the life expectancy in the United States is lower than in Canada.

That American males and females both have lower life expectancies than Canadians shocks me as I think of America as a truly wealthy nation compared to Canada.

However, while the elite of Park Avenue may be better cared for, the poor of small town Delaware seem to be dying earlier.


OMG doggril, "truthseeker", and katydid: Ad hominem blow-hard trio of tripe. Katy, didja read section9's first point: The CHART CLEARLY SHOWS the economic conditions PRIOR to Sarah Palin being elected governor. OOPS. Missed that one, huh? Here's a tip: DO take your own advice and take a whack at thinking for yourself for a change, but only after you have researched the facts. As for Colin's remarks re: checks for Alaskans, there is a HUGE difference between 'spreading the [earned] wealth' of others and sharing the wealth of our commonly held resources. In fact, those two concepts are diametrically opposed, kinda like socialism vs. fiscal conservatism. Doggril, didja actually say something original? Nope. No problem, just go ahead and spout whatever sounds good at the moment on any given day on any given barstool... And "truthseeker", could it be that even Republicans called her socialist because she actually held her own party members to account and made them more than a little uncomfortable? I thought you people LOVED when our people buck our own party? Hm, guess not. And guys, throwing the phrase "Bridge to Nowhere" into every comment might be good for a few chuckles, like "Village Idiot", "Swiftboaters", and "Teabaggers", but when you find out too late the negative connotations of those derisive catch-phrases actually APPLY TO YOU and have brought about the demise of the freedoms you once enjoyed, well, I hope you enjoy food lines, sucky cars, and itchy toilet paper. Better yet, why stay in America at all? It's still one of the easiest countries in the world to leave. But ya better move fast, cuz CHANGE is definitely HERE. JDM

Awesome!

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