Liberals = Debt?

by brendan on 06/25/2011

A co-worker recently made a claim to me that our country’s most financially busted states were also the most liberal states, and went on to say that the liberal ideology is what put them into their debt-laden situations. I didn’t know if these claims were true or not, so I decided to do some research.

Getting data on state deficits, budgets, and populations was pretty straightforward. Quantifying whether a state was Liberal or Conservative was less so. I decided to go with three indicators. The first was whether the state’s governor was Republican or Democrat. The second was which presidential candidate the state’s electoral votes went to in the 2008 election. And the third was an average margin of victory for Republicans or Democrats over the last 5 presidential elections; something Wikipedia is using to label states as either Red, Blue, or Purple (in the middle).

So what does the data say?

For starters, one way to determine if a particular ideology is more fiscally responsible than the other is to just look at the states with no deficit at all. There are six; Arkansas, W. Virginia, Montana, Alaska, North Dakota, and Wyoming. Three of them have Democrats for governors, and three have Republicans, though all six went for McCain in 2008. And four of the states were considered Red by Wikipedia. So far so good for my co-worker, and not so much so for the Liberals.

The other end of the spectrum, the most debt-laden, paints a picture that’s much less black & white. California has the largest deficit, and they’re as blue as a blue state can be. But second place is occupied by Texas, who is typically quite proud of their very Red state label. Absolute totals are probably not the best way to read the data, since of course California and Texas will have a lot of debt. They have a lot of people.

For deficit as a percentage of budget, Nevada reigns supreme with a whopping 45%. And they’re a Red state. Second place is New Jersey with 37%, and they’re a Blue state. Of course, third is Texas and fourth is California, so they don’t seem to do well no matter whether we’re looking at the absolute or the relative data. The all Liberals = Debt theory is starting to look a little weaker than it did before.

Alright, so what’s the answer? Does being a liberal state equal debt?

Not really, according to this data. You can probably make a strong argument that more of the states with debt are Blue states. But there are some Blue states with no debt or very little debt (like Iowa), just as there are Red states with tons of debt (like Texas or Nevada). So I can’t justify saying that being a liberal state means you automatically have more debt, since that doesn’t hold up across all of the states.

For the record, I’ll be the first to admit that I’m not a statistician and you can trust my analysis about as far as you can throw it. I personally think the argument that more populated states tend to accrue higher deficits is just as likely as any sort of political explanation (the six states with no deficit are all in the bottom third of population). But you don’t have to trust me. I put the data in a Google Spreadsheet so you can see it yourself and sort it any way you like. Download it here (State Budget Deficits 2012 [PDF]) as a PDF too, if that’s your thing.

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