Comment by timr | Hacker News Reader

Comment by timr | Hacker News Reader

"I pointed out that California collects a larger percentage of its citizens’ income than all but five other states (10.5 percent; source). Shouldn’t it be possible to run the state on 10.5 percent of income?

Despite the fact that all of my interlocutors had university educations, sometimes including PhDs, all were so deeply invested in the idea that their insolvent state government is starved for revenue that they were unable to parse the information."

Perhaps they were just stunned that someone with a PhD doesn't know that income tax isn't the whole story?

California state revenue, 2009: $88 Billion (source: http://www.ebudget.ca.gov/pdf/BudgetSummary/SummaryCharts.pd..., chart SUM-01)

California population: 36.8 million (July, 2008; source: US Census)

CA Revenue per capita: $2391.30

Texas state revenue, 2009: $78 Billion (source: http://www.cpa.state.tx.us/taxbud/bre2008/BRE_2008-09.pdf, page 3)

Texas population: 24.3 million (July, 2008; source: US Census)

TX Revenue per capita: $3209.88

"Conservative" Texas takes in almost a thousand bucks more per person in taxes and fees than does "liberal" California.

UPDATE: I made a mistake. The numbers for Texas are reported on a biennial basis, whereas for California, they're reported on an annual basis. See my reply to cwan below for details. When you get the annual numbers from the Texas budget summary, they appear to take in about 32% less per capita than California.

I'm afraid you are incorrect. The link you put for California is just the general fund, which does not include special funds, bond funds, or federal funds like the Texas one does. After you add those in, California's count is $208 billion in 2008-2009. See this for more: http://www.dof.ca.gov/budgeting/budget_faqs/information/docu...

Edit: I should say though, right on for pointing out the material issue. You got the meat of it right in that it's overall spending that matters, not just income tax. You "showed your work" correctly, you just plugged in the wrong numbers. That means you get an 8/10 from me.

Edit2: I read the parent's post too quickly in my haste to make a point. However, neither of us considered the contribution of local taxes, as discussed below. I believe that that definitively answers the question of which state spends more per capita.

And after you add them in for Texas, it's $158 billion. You're comparing apples and oranges.

Additionally, timr was correct to restrict his numbers to state tax revenue, which is the total under discussion.

If you do the math, it comes out to $6,500 per person in Teaxs, and $5,600 per person in California. So even considering the other sources of revenue (though it makes no sense to do so in this context), timr's point is still correct.

You're right, I misread the parent's post. It's unclear to me at this point whether the sums actually account for the same basket of incomes, but even if they do you have to admit that after this adjustment timr's point is about 50% less correct than it was before.

Apparently still not true. Have a look here (California State Per Capita Revenue numbers) 2010E - State: $4015; State+Local: $9050 http://www.usgovernmentrevenue.com/CA_per_capita_revenue.htm...

and here (Texas State Per Capita Revenue numbers) 2010E - State: $2980; State+Local: $7041 http://www.usgovernmentrevenue.com/TX_per_capita_revenue.htm...

These tie better back to the US Census numbers (which are only as at 2004 but are on an apples-apples basis): http://www.census.gov/govs/state/04rank.html

The problem is that states do not report revenues in the same ways and some are clearly more creative than others.

Yes, there's a problem with my original post; no, it's not related to federal transfers -- it's correct to exclude them from the calculation. The problem is that Texas (bizarrely) allocates its budget on a biennial basis. I didn't read the documents closely enough, and had assumed that 2009-2010 meant fiscal 2009-2010. Oops.

From the same Texas source, table A-12, the estimated total state revenue is $39.3 Bn for fiscal 2009. Thus, the per-capita revenue numbers for fiscal 2009 would be $1,617.30, versus $2,391 for California. So, I'm wrong. Texas takes in about 32% less per capita than California.

It's not that bizarre they budget biennially -- when you consider that the Texas legislature is part-time, and meets only every other year.

Given the eternal train-wreck that is California budgeting -- even in good years, they just give away the store in future obligations (like public pensions) that make the bad years twice as bad -- fewer, longer budgets might be a good idea here as well.

AFAIK, the biggest problem with California budgeting is the initiative-driven pre-allocation of huge amounts of money that would otherwise be discretionary income. Pensions may play a part, but not nearly to the extent claimed by certain partisan interest groups.

You're right that I'm wrong, but you're wrong about the reason. Federal contributions and local taxes have nothing to do with it -- the Texas budget is calculated on a biennial basis, whereas the California budget is calculated on an annual basis.

I could be reading this wrong but I believe the California figure is for a single year (fiscal year 2009-2010) while the Texas figure covers two years (the 2008-2009 biennial).

I believe you are correct! See http://www.texasbudgetsource.com/texas-budget-overview

The chart says 85.7 billion in 2008, 82.1 billion in 2009, and the text claims $167 for the 2008-2009 biennial.

That's slightly higher than the per-year figure in the original comment:

I don't think he's correct.

I'm guessing there's something seriously different on the accounting between states (2004 Census - comparison between states): http://www.census.gov/govs/state/04rank.html

Shows California State's per capita consumption/expense at $6,397.23 / $5,686.48

For Texas State it's $4,030.37 / $3,441.53

Granted, it's 2004 numbers but at least it's more certain the numbers are being compared on the same basis.

That doesn't address his point: "Shouldn’t it be possible to run the state on 10.5 percent of income?". I think it most certainly should.

As a human being I'm responsible for managing my own budget: if I spend more than I earn, I suffer the consequences. Government, including California's, doesn't seem to view reducing outgoings as a possibility, and thus is obsessed with increasing incomings. One of its approaches to doing so has been to maintain a high tax rate.

Aren't they required by the California constitution to maintain certain percentages of spending for education? Among other things?

You have to weigh reduced spending with the consequences of that, and sometimes maybe running a deficit is better.

That's not to paint too rosy a picture- California is doing plenty of absurd things with its money, but much of that is mandated by the propositions, not a choice by the legislature (Three strikes means more, unavoidable, prison expenses, the high speed rail bond fiasco, the extravagant research bonds that inevitably get approved and squandered).

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