State Relationships Between Political Affiliation and Financial Condition

Welcome to Issue Autopsy's debut. Issue Autopsy is a different concept in news analysis, topic discussion, self directed education and public discourse. As such, bear with us as we improve and evolve the Issue Autopsy site based on participant input.Today's dissection: Is There a Relationship Between Political Affiliation and Financial Condition? From our peripheral vision we see the ridiculous US Presidential election is both over and grossly expensive. Who thought the auction to be US President would cost over $1,000,000,000? Our unfocused gaze is daily diverted to so much nonsense, violence and political shenanigans locally, nationally and globally. Let us focus on something that directly affects each of us who works to put food on the table: Your individual state’s financial ability to pay bills due in the next 30 to 60 days defined as cash solvency. States with positive cash solvency can meet their near term bills. States with negative cash solvency cannot and must usually borrow to pay near term bills. The chart below was compiled from George Mason University and shared from the DailyReckoning.com financial analyst Jody Chudney. In the graph positive numbers are good and negative number are not. Blue bars delineate Democrat voting states and Red denote republican voting states:

George Mason University also analyzed long term cash solvency examining the full balance sheet, which includes assets like government owned land and buildings, long-term liabilities like pension funding and debt issued for funding projects. Here’s the graph:

Another way to see the financial condition of your state is examining the next graphic, which depicts where each state was ranked by George Mason University in terms of overall financial condition. The darker the aqua green the better the financial condition. Orange is bad and dark orange is the worst: 

Now lets correlate the above map with the map below depicting the 2016 presidential election from the University of Michigan:

The correlation is telling.There are some swing states such as Pennsylvania who voted opposite their typical party affiliation, in their case voting Republican instead of their usual Democrat. The states with the worst financial conditions can be traced to many sources. One of the major source is underfunded state employee pension plans and benefits. How long will, or can any of the states maintain current state pension payouts before driving out companies and their employees? On the current individual state's spending trajectories we will find out sooner than most people think. Consequently, like it or hate it, the taxes from legalizing marijuana will go a long way to kicking this can down the road, which is why state legalization everywhere is a slam dunk.

Thanks to Canadian Jody Chudney, credit analyst at The Daily Edge (Facebook:@TheDailyEdgeUSA), who first analyzed this political-financial relationship. Also great thanks to the DailyReckoning.com


Thanks for reading.