Public-Finance on Rabid Curiosity

Public Finance of the States: Florida

Tue, 17 Mar 2026 11:30:00 -0500

Florida’s Growth-Funded Model

Florida has no personal income tax and sustains itself on a combination of sales taxes, property taxes, documentary stamp taxes on real estate transactions, and the economic windfall of being one of the country’s premier destinations for both tourism and retiree migration. The model has worked during periods of growth, and it has created fiscal vulnerabilities that become visible when growth slows.

Revenue Structure

Sales tax is the primary state revenue source at 6%, with a broad base that includes many services. Florida’s sales tax revenues are strongly correlated with tourism and consumer spending, making them sensitive to national economic conditions and travel patterns.

Public Finance of the States: New York

Tue, 17 Mar 2026 11:25:00 -0500

New York’s Fiscal Complexity

New York is both a state and a city in a way that complicates most fiscal analysis. New York City’s budget is larger than most states. The fiscal fortunes of the state are deeply entangled with the fortunes of the financial industry concentrated in Manhattan. And the political economy of a state that must satisfy both the country’s densest urban core and large rural upstate regions produces a governing complexity with no real parallel.

Public Finance of the States: California

Tue, 17 Mar 2026 11:20:00 -0500

California’s Singular Scale

California’s economy is roughly the size of the United Kingdom’s. Its state government collects more revenue than most countries. Its fiscal decisions ripple through national markets for municipal bonds, healthcare, and education. Analyzing California’s public finance requires first setting aside the usual state-level frameworks—California operates at a scale where different dynamics apply.

Revenue Structure and Volatility

California’s defining fiscal characteristic is not its level of taxation but its structure of taxation—specifically, its extraordinary dependence on personal income taxes from high earners.

Public Finance of the States: Texas

Tue, 17 Mar 2026 11:15:00 -0500

Texas’s Fiscal Model

Texas is the most influential fiscal model in American state government—a large, fast-growing state that has maintained no personal income tax, attracted enormous business investment, and used its model as a competitive wedge against higher-tax states. Whether Texas’s approach represents a sustainable model of governance or a set of deferred costs and distributional choices that will eventually come due is one of the defining debates in state fiscal policy.

Public Finance of the States: Ohio

Tue, 17 Mar 2026 11:10:00 -0500

Ohio’s Fiscal Middle Ground

Ohio is the Midwest’s great median case—large enough to matter, diverse enough to reflect the full range of regional tensions, and fiscally positioned neither at the crisis end (Illinois) nor the model end (Indiana). Understanding Ohio means understanding a state managing genuine post-industrial transition while navigating intense interstate tax competition and the fiscal complications of being a genuine political swing state.

Revenue Structure

Ohio’s revenue mix has shifted significantly over the past two decades. A major tax reform in 2005 phased out the tangible personal property tax and the corporate franchise tax, replacing them partly with a Commercial Activity Tax (a gross receipts tax applied to business revenues) and partly with reductions not fully replaced—a net tax cut that reduced the state’s fiscal capacity.

Public Finance of the States: Illinois

Tue, 17 Mar 2026 11:05:00 -0500

Illinois’s Fiscal Crisis in Context

Illinois is the cautionary tale of American state finance—a large, productive economy with a world-class city at its center that has nonetheless accumulated one of the worst fiscal positions of any state in the country. Understanding Illinois requires separating the genuine structural problems from the political dysfunction that has prevented their resolution, and being honest about how much of the crisis was a choice rather than an accident.

Public Finance of the States: Indiana

Tue, 17 Mar 2026 11:00:00 -0500

Indiana’s Fiscal Identity

Indiana has cultivated a reputation for conservative, stable fiscal management that is largely deserved. Among the Great Lakes states, it stands out for maintaining a balanced budget through economic cycles, keeping debt levels low, and resisting the pension obligations that have crippled Illinois to its west. Understanding how Indiana got here—and what it costs—requires looking at the history, the revenue structure, and the political economy that has sustained this approach across decades and governors of both parties.

Public Finance of the States: The West

Tue, 17 Mar 2026 10:45:00 -0500

The Fiscal Character of the West

The West is America’s most fiscally diverse region—home to California’s singular economic scale, the extractive-industry booms and busts of the Mountain states, and the ideological experimentation of a region that has never had one dominant political tradition. The range runs from California’s large, activist state government to Wyoming’s minimalist reliance on mineral extraction revenues.

The region divides into the Mountain states and the Pacific Coast, with meaningfully different fiscal profiles.

Public Finance of the States: The South

Tue, 17 Mar 2026 10:40:00 -0500

The Fiscal Character of the South

The South is America’s fastest-growing region and, in many ways, the testing ground for the low-tax, low-service model of governance. The combination of population growth, relatively low public sector legacy costs, and aggressive interstate tax competition has produced a distinctive fiscal philosophy—and significant debate about whether it actually delivers better outcomes for residents.

The region spans three Census divisions: the South Atlantic, East South Central, and West South Central, covering sixteen states with considerable internal variation.

Public Finance of the States: The Midwest

Tue, 17 Mar 2026 10:35:00 -0500

The Fiscal Character of the Midwest

The Midwest is America’s fiscal middle ground—neither the high-tax, high-service model of the Northeast nor the low-tax competition model of the South. But within that broad characterization lies enormous variation, from Illinois’s catastrophic pension crisis to Indiana’s reputation for conservative fiscal management to Minnesota’s Scandinavian-inflected public sector tradition.

The Census Bureau divides the Midwest into the East North Central and West North Central divisions, though the more meaningful distinction for fiscal purposes is between the industrial Great Lakes states and the agricultural Plains states.

Public Finance of the States: The Northeast

Tue, 17 Mar 2026 10:30:00 -0500

The Fiscal Character of the Northeast

The Northeast—New England plus the Middle Atlantic states—is America’s oldest industrial and commercial core. Its fiscal profile reflects that history: high taxes, high services, dense and aging infrastructure, and long-standing commitments to public institutions that are expensive to maintain and politically difficult to reduce.

The region encompasses two distinct sub-regions with meaningfully different characters.

New England

Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont share geography but diverge sharply on fiscal philosophy.

Public Finance of the States: Series Overview

Tue, 17 Mar 2026 09:00:00 -0500

What This Series Is About

State governments occupy a fascinating and underappreciated position in American governance. Unlike the federal government, they cannot print money, must generally balance their budgets, compete with neighboring states for residents and businesses, and face hard tradeoffs with finite resources. That combination of constraints makes state finance one of the most instructive places to study how political priorities translate into actual policy.

This series examines each of the fifty states—organized by region—through the lens of public finance. The goal is not a dry recitation of budget numbers but an attempt to understand what each state’s fiscal choices reveal about its political economy, its history, and its relationship with the people it governs.