Study: RI ranks No. 1 among states for ‘spreading the wealth’
December 8th, 2011 at 3:08 pm by Ted Nesi under Nesi's Notes, On the Main Site
Rhode Island has finally a topped a set of national economic rankings – but your view on whether that’s a good thing may depend on your policy preferences.
Rhode Island does more than any other state “to level the playing field by redistributing money through education spending, unemployment benefits, health care, welfare, and other means,” according to a list put together by 24/7 Wall St, which last month ranked Rhode Island No. 43 among best- and worst-run states.
“Rhode Island performs exceptionally well in all of the ‘generous’ state metrics,” the list’s three authors say. “It provides Medicaid beneficiaries with the third-largest amount in payments. It provides the unemployed with almost 46% of their previous weekly wages – the second-highest rate. Those receiving cash assistance through TANF, on average, can receive benefits for the second-longest period among all states.”
“Of course,” they add, “taxes must be relatively high to fund these programs. The state has the fifth-highest state-local tax burden in the country.” (The fifth-highest figure comes from the Tax Foundation; the Massachusetts Budget and Policy Center puts it a bit lower, at 12th-highest.)
Neighboring Massachusetts came in second on 24/7 Wall St.’s list, with the rest of the top 10 mostly made up of Northeastern states plus Hawaii, Alaska, Minnesota and California. At the other end of the scale, the site said Arkansas, Tennessee and Idaho do the least to “spread the wealth” among their citizens.
24/7 Wall St. said it found states with high rates of redistribution often also have high rates of inequality and higher costs of living. You can read about the site’s methodology here, and dispute it below in the comments section if you disagree. Here are the six measurements the site used and Rhode Island’s results:
- Average pension benefits: $25,571 (6th highest)
- Total per pupil spending: $13,707 (8th highest)
- Medicaid payments per beneficiary: $8,208 (3rd highest)
- Weekly wages covered by unemployment benefits: 45.9% (2nd highest)
- Number of months of TANF received: 46.5 months (2nd highest)
- Average TANF cash assistance per month: $417 (10th highest)
Update: On Twitter, @jasonpbecker is first to question 24/7′s methodology. “How is statewide education spending per pupil related to ‘spreading the wealth’?” he asked (abbreviated). “Lots of inequality there!”
Tags: 24/7 wall street, rankings, safety net, unemployment, welfare
Nesi's Notes covers politics and the economy in and around Rhode Island for WPRI.com. (Twitter: 
Spreading the wealth or welfare state?
For a bit of elaboration, there are many methodologies available to measure inequality. These include the Gini Coefficient, the ratio of the 95th to 5th percentile school spending, etc.
Here’s a look at using regression analysis to determine how strong the relationship between poverty and education spending is in the state (http://www.schoolfundingfairness.org/National_Report_Card.pdf). Not my favorite method, but certainly substantially better than total per pupil spending at measuring “redistribution”.
Ultimately, the easy critique of the whole methodology is that it never measures actual transfer of wealth or redistributive policy. They don’t even measure how progressive (or regressive) our tax code is, certainly one of the most powerful tools used to spread the wealth.
I cry foul. Nothing on taxes?
Good for Rhode Island!
Not for nothing, where does Rhode Island rank in an economy which can afford these redistributions? Next question, given the political culture why would significant investment be drawn to this state? The folks who like this state of affairs really ought to ask if confiscatory redistribution, masquerading as compassion, has worked anywhere. Just in case these folks haven’t noticed, European socialism is bringing down whole countries.
TOTO, where ARE WE ? …. and who did THIS MATH ?
I know too bad you people still believe that FDR’s three level programs helped Rhode Island. Too bad you don’t look at history that Rhode Islanders almost straved because there was no incentive to distribute food here because no one could pay. The first thing you all think is the government should help, too bad you don’t grasp this concept. There are 299 million Americans who don’t want to support 1 million Rhode Islanders. You people better stop looking at the government as you savior. It is time to get to work in the private sector.
I know many of you think the restaurant industry is lucrative too bad so many Rhode Island restaurants would be closed in the rest of the country, the reason they are health hazards. Remember this jingle before you dine go on line @ http://food.ri.digitalhealthdepartment.com/.
If you don’t think these issues are interrelated you are very sadly mistaken. Rhode Islanders are not known for having a good work ethic, there is also a mentaility of giving people a break when they do something negative, that is called enabling. The more you enable the worse it gets for the entire society. There are 115K people who never worked and another 50K out of work in Rhode Island, many of these people will never work again. This state does not have the resources to support that many displaced people. If they can’t get a job it might be time to cut benefits off to them so they either relocate or get motivated to find a job. Social Services are not to supposed to be more than decent paying job. When you look at the benefits offered for people collecting welfare they are getting close to the value of a taxable income of $45K, that has to stopped.
For decades, RI sat between two prosperous states commutable from RI. The morning rush on Rt 95 going north (with little going south) is testimony to our long term reliance on the pro business policies of other states.
That is changing and we need to finally recognize that RI has an identity problem when it comes to the private sector creating jobs right here.
The unions have to begin adopting policies that are long term and pro business and not just to promote those who have been in public service and are close to retirement.
Look what those short sighted policies have brought you.
[...] = [];}Does Rhode Island really lead the nation in its efforts to redistribute wealth, as 24/7 Wall St. suggested in a recent set of rankings splashed across MSNBC.com and The Huffington Post? Not necessarily, say two of the state’s [...]