I have found it rather interesting over the years to hear Alabama politicians “cuss” the “bad ole federal government” and then take money from that very same government. Realizing that our state depends heavily on Washington for revenues, acting in that manner has always seemed to me to be hypercritical. It was reported recently that more than 38 percent of Alabama’s revenues in 2011 came from federal transfers, known more formally as “intergovernmental revenue.” A new graphic created by the Tax Foundation shows that our state was near the middle of the pack in terms of reliance on federal dollars for revenue in that year.
Most states get between 30 percent and 40 percent of their revenues from intergovernmental transfers, including Texas, which receives the 11th largest share of federal revenue relative to other dollars (39.98 percent), and Washington State, which receives the 41st largest share (31.27 percent). Alabama’s share ranks it 20th among the states.
Overall, Alabama collected $26.3 billion in revenues in 2011, according to the U.S. Census Bureau’s 2011 Annual Survey of State Government Finances. Of that, close to $9 billion came from intergovernmental transfers. Those transfers include Medicaid, general assistance spending, and education spending, according to the U.S. Government Accountability Office. Such spending grew more than four hundred (400%) percent across all states between 1977 and 2009, according to the GAO. As for overall economic output, Pew estimates that federal dollars pay for nearly nine percent of Alabama’s annual GDP, mostly for defense-related projects.
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