22-05-2025
- Politics
- Wall Street Journal
New York, SALT and the ‘Donor State' Myth
In his May 17 letter 'Why I Won't Give In on the SALT Deduction,' Rep. Mike Lawler (R., N.Y.) writes that 'New York is a donor state, receiving less money back than it sends to the federal government in tax revenue.' That hasn't been true for the four most recent years for which data are available. Thanks to Covid spending, New York's comptroller has reported receiving more money from Washington than the state's taxpayers have given in fiscal years 2020, 2021, 2022 and 2023. As Matthew Schoenfeld wrote in these pages in 2020, the claim that New York is a donor state is based on including such sums as military pay and Social Security retiree benefits while excluding things like the tax exemption for municipal bonds—all of which make blue states look more like 'donors' than they really are.
New York's state government spends twice as much as Florida's does, despite the latter having more residents. No state has abused ObamaCare Medicaid expansion to the extent New York has. The healthcare program that is supposed to be for poor children and the disabled covers 44% of New York residents, about half of whom are able-bodied, working-age adults, and about a third of whom are likely ineligible for the program. If anything, New York should be more of a 'donor' because the federal government should stop giving it billions of dollars in matching funds for enrolling able-bodied, working-age adults in Medicaid.
