According to a report released last week by the Pew Charitable Trusts, Alabama receives 36.1 percent of its annual revenue from the federal government, the ninth highest percentage in the country.
Nationwide, the ratio was down to about 30 percent, the lowest it has been since the Great Recession spurred massive growth in federal spending. But while this figure is closer to pre-recession levels, it’s still slightly higher than the 28.5 percent average for the decade proceeding the financial collapse.
Interestingly, of the top ten most federally-funded states, eight of them voted for Mitt Romney, who as the Washington Post points out, ran on a platform of scaling back the size of the federal government.
Only two of the bottom 10 voted for Romney.
According to Dr. John Hill, Senior Policy Analyst at the Alabama Policy Institute, there is one specific reason Alabama tends to have a relatively high amount of its revenue come from federal sources.
“The state’s poverty rate is 20% higher than the national average,” Dr. hill told Yellowhammer. “With one in every six Alabamians living in poverty, the state naturally gets more aid from the federal government. Alabama already receives about $4 billion a year in federal funds for Medicaid; this number will skyrocket if the program is expanded.”
Across the country, federal money accounted for about $500 billion of the $1.7 trillion spent by state governments.
The analysts at Pew expect the percentage to decrease further as state economies recover and recession-era stimulus dollars from the feds dry up.
But if Gov. Bentley’s rumored Medicaid expansion plan becomes a reality, Alabama could be headed in the opposite direction.
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— Elizabeth BeShears (@LizEBeesh) January 21, 2015
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