Debunking the Myth of High Per Capita State Spending in Louisiana

     Advocate political columnist Jeff Sadow and I are old friends from graduate school, polar opposites on politics.  I’m not surprised at his blaming Gov. John Bel Edwards, only two months in office, for the State’s current budget problems.  It justifies his blind support for the tourist who lived in the Governor’s mansion the previous eight years!  However, Sadow’s critiques contain vital passages that perpetuate a myth of comparatively high per capita State spending in Louisiana, and its corollary that state government in Louisiana has a spending problem!  Well, not now!

     In late February, Sadow claimed that Louisiana State Government “ranks well above the national average in per capita spending.”  Then, in his “Moody’s downgrade is Edwards’ fault” piece, Jeff spoke of “state and local government spending” that is “ an estimated 18th highest per capita among the states in 2015.”   He never publicly provided data sources to support his contentions.  I combined U. S. Census data with 2015 state spending estimates from the National Association of State Budget Officers.  The fifty state budget officers report data directly to NASBO.  See my original report here.  In 2015, total state fund and federal fund expenditures per capita ranged from a low of $3,724 (Florida) to a high $18,644 (Alaska), with a national average per state of $6,649.  Louisiana ranked 22nd out of fifty states at $6,365 per capita, $284 per capita below the average of the states nationwide!

     Louisiana spent an estimated total of $29.7 billion in 2015, but $10.15 billion of this was federal funds: $2,173 per capita (ranked 14th), or about $200 per capita above the state averages nationwide.  The Louisiana state portion of total state government spending was $19.58 billion.  Nationwide, state fund expenditures averaged $4,676 per capita.  Louisiana averaged $4,192 in per capita state fund spending, placing it 23rd, or $483 per capita below the average of the states nationwide!

     Sadow emailed his data with his source.(1)  He defended his contrary position. I discovered that the "high per capita spending" myth results from data and an analysis that violate concepts of validity and reliability crucial to scientific research methods and statistics.  I followed Sadow's data trail.(2)  First, he confuses units of analysis: instead of comparing per capita spending in Louisiana to a national average of all 50 states, he compares Louisiana to a national level calculation of per capita spending by states, which where I'm from is like comparing merlitons to alligators (apples and oranges for those uninitiated into Louisiana culture).  In other words, the website upon which he depends for his data totals the per capita spending of all states, then divides by the U. S. population size, which yields a lower number than the real average of state per capita spending.  In the end, Sadow is comparing one unit of analysis (States) with another (Nations).  The only reason for calculating the national number using the U. S. population size is to create an average that is comparable to that of other nations, not when comparing individual states to one another or to an average of state numbers.

     Secondly, his data source is a website that links to 2013 Census data on state spending, not 2015, yet doesn't contain any of his numbers!  There are many more problems with Sadow's "supporting data" and his analysis, but these will have to wait until I catch up with my real work responsibilities.  In any case, I hate to publicly call my friend out on this!  Maybe Dr. Sadow was unaware! Sometimes "things slip through the cracks."  Regardless, he's wrong on something with serious policy implications!

Updated March 7, 2016, 9:00am.

Copyright 2016 Michael Kurt Corbello

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(1)  Dr. Jeff Sadow to the author, based upon an email exchange dated March 3, 2016.

(2)  Screen captures occurred on March 5, 2016

First, we have Dr. Jeff Sadow's favorite data site for this discussion.

Notice the URL, the year, and the numbers for Louisiana and "All states combined" down the first column.  In addition, see the source listing for "State and Local Gov. Finances."  This is the data used in his calculations (actually, he didn't calculate anything, he just reposted what is here) to argue that Louisiana State government engages in a pattern of high per capita state spending.  At the same time, Sadow often alternates his focus from "state and local spending" to "state spending," in the case of the latter, not bothering to distinguish spending of State funds from spending that is from Federal funds, an important distinction.  The only thing that counts in this discussion is State per capita spending of State and Federal funds, separate and combined.

Then, here is the link to the Census site highlighted as a source in the bottom of the table above.  Notice that this is 2013 data, not 2015.  In fact, the dropdown menu doesn't show a more recent year than 2013.

Then, we come to the "Expenditure" data found in the 2013 State & Local Government link above (since this source does NOT show the 2015 data, as claimed by Sadow.  It's his job as a scholar to find this out).  Notice that the 2015 data has Louisiana State spending (minus local spending) at $32 billion, not the $26.5 billion number in the Sadow source's chart.  I stand by my data and my analysis!

Updated with commentary on March 8, 2016.