The Consolidated Federal Funds Report that both are seeking to replace was created in 1982 and was largely an aggregated product, a roundup of data produced across several federal agencies. It covered retirement and disability payments, direct payments, grants, procurement contracts, salaries and wages, direct loans, and insurance. It was imperfect, as the data came from different sources using different methods, but it offered a bird’s-eye view of federal spending on the states, researchers say.The loss of the report was barely noted in the press at the time, though The Economist lamented its loss in a blog post,wryly noting that “it seems the federal government does not have enough money to find out where its money is spent.” It was crucial to the work of a small set of researchers, academics and journalists, offering a broad view of how federal money is transferred to states.
Like NPP’s October attempt, Pew’s report seeks to replicate and replace the methods used by the Census Bureau. Pew breaks down federal spending into five categories: retirement benefit payments; non-retirement benefit payments; grants; contracts; and salaries and wages.
Per capita federal aid is lowest in Utah
(CORRECTION: An earlier version of this post incorrectly states estimates for per-capita federal aid by the National Priorities Project. It has been updated.)
The two analyses come to similar conclusions in looking at per-capita federal spending. Virginia is the state that receives the most per-capita federal aid, according to both analyses. Pew estimates that number to be $16,710 per person, while NPP pegs it at $17,069. Utah received the least federal aid per capita—$7,108, according to Pew, and $7,239, according to NPP.
Federal spending in the states grew 26 percent over the decade
Between the 2004 and 2013 fiscal years, federal spending rose 26 percent, with all categories except grants posting increases, according to Pew.
Federal spending accounted for about a fifth of state economic activity
Pew found that federal spending in the states in the 2013 fiscal year accounted for about 19 percent of state economic activity overall. Its economic share was largest in Mississippi, where it accounted for about a third of activity — 32.9 percent — and smallest in Wyoming, where it accounted for 11.6 percent of economic activity. (In D.C., it accounted for 42.3 percent of activity.)
The mix of federal spending is different in each state
States not only vary in the share of economic activity accounted for by federal spending, but also in the mix of federal spending received. Here’s one example from Pew:
For instance, in both Louisiana and Alaska, total federal spending was equivalent to about 18 percent of state GDP in fiscal 2013, just below the national average. But spending on salaries and wages was equivalent to 4.4 percent of Alaska’s economic activity compared with 1.4 percent of Louisiana’s.
Most federal spending went out as benefit payments
The majority of federal spending in states came in the form of benefits payments to individuals, according to Pew. A full third — 34 percent, or just over $1 trillion — went out in retirement benefit payments. Non-retirement benefits accounted for 27 percent of spending. Grants accounted for 16 percent, while contracts accounted for 13 percent. A tenth of the money spent went to pay salaries and wages.