The aid is especially important in economically challenged areas across the country, many of which are heavily Republican and concentrated in swing states that will determine the outcome of the presidential election. There is little incentive for either party to cut spending.
The primary reason for this dramatic growth is that a significant percentage of Americans are elderly, and their health care costs are rising. At the same time, many communities are experiencing economic decline due to challenges such as the loss of manufacturing jobs, where government funding accounts for a large portion of people’s incomes.
In its analysis of government spending, EIG used a definition of government revenue that includes spending on programs that Americans pay for, such as Medicare and Social Security. Medicaid, the other major government health program, also counts.
The analysis also includes unemployment insurance, food stamps, earned income tax credits, veterans benefits, Pell grants, coronavirus-era payments and other income supports. Although states help pay for some of these programs, such as Medicaid, about 70% of the total cost is covered by the federal government.
EIG’s analysis does not include other ways government spending flows into parts of the United States, such as agricultural subsidies and military bases.
This expenditure is a large and growing proportion of the national debt. But this year’s presidential candidates, Democrat Kamala Harris and Republican Donald Trump, have said little about reining in the policy. In fact, they have proposed plans that will increase costs even further. Trump would eliminate taxes on Social Security benefits. Among other proposals, Harris would expand the Earned Income Tax Credit for low-income workers and extend expiring Affordable Care Act subsidies.
Data helps explain why. Counties that rely heavily on government spending tend to be smaller, but they are still home to nearly 22% of the U.S. population.
Growth in these counties is much more concentrated in areas that vote Republican or have shifted Republican.
Maps of government spending also help explain the rise of Donald Trump. He promised not only to revitalize America’s economically depressed communities, but also to protect Social Security and Medicare from cuts “not even by a penny.” This stance was a departure from previous Republican leadership, which has pushed to rein in spending, in some cases cutting benefits to future retirees.
This is how the most reliable counties voted in 2020.
Many of the counties that rely heavily on government funding for safety nets and social programs have one thing in common: they are concentrated in swing states that will decide the presidential election.
Approximately 70% of counties in Michigan, Georgia, and North Carolina rely heavily on government revenue. So do nearly 60% of Pennsylvania’s counties. In Arizona, 13 of the 15 counties rely heavily on safety net income.
Measured another way, more than 44% of Michiganders live in counties that rely heavily on government programs. In Arizona, Pennsylvania, and North Carolina, more than a third of the population lives in such counties.
Trump has visited Johnstown, Pennsylvania, during all three presidential campaigns, promising to revive the economy. Once a steel powerhouse, the city and surrounding Cambria County lost jobs as the industry collapsed, businesses shuttered and workers leaving for opportunities elsewhere. The city has lost more than half its population since 1970.
The number of workers has fallen by more than 10% since 2000, and the number of establishments has declined as well.
The renewal has yet to materialize, and voters in the county are increasingly supporting the Republican presidential candidate. Trump won 68% of the vote in 2020.
About 35% of county revenue comes from federal and state safety net payments and social programs, the highest percentage in the state.
Like much of Pennsylvania, northern Michigan counties rely heavily on federal funding. But Leelanau County, jutting into Lake Michigan, stands out.
What Cambria has in common is that many elderly people are beneficiaries of Social Security and Medicare. In Leelanau County, 35% of residents are elderly, compared to 25% in Cambria.
Still, government social welfare and safety net revenues account for 16% of total income in Leelanau County, compared to 35% in Cambria County. This is primarily due to the much higher basic income of Leelanau, which is a popular retirement and tourist destination. The population has increased by 6% since 2010.
And while voters in Cambria County tilted more toward President Trump in 2020 than in 2016, voters in Leelanau County shifted toward Democrats.
In Wake County, North Carolina, we see a very different picture. North Carolina’s largest county, which is rapidly growing and includes the state capital, Raleigh, relies on government assistance for only about 10% of its income. The young population is a big help. Only 13% of Wake County’s population is over the age of 65, far below the national rate. In other words, residents are not making much use of government programs for the elderly.
Approximately 14% of the population was born in other countries, roughly matching the US level. According to EIG data, counties with large numbers of immigrants tend to be less dependent on government programs compiled by EIG, while counties with smaller foreign-born populations tend to be more dependent on government spending.
Since 2008, the county has supported Democrats in presidential elections, but has steadily turned bluer. Biden won 62% of the vote in 2020.
Government spending on anti-poverty measures also contributes to the trend of increased dependency, especially during economic downturns. But even as the population ages, poverty in the United States remains relatively stable. On the other hand, costs associated with an aging population are rising.
More than 17% of Americans are now age 65 or older, up from about 10% in 1970.
According to EIG’s analysis, spending on these programs exceeds the income people receive from other sources. Meanwhile, the pressures of an aging population continue unabated, with the Census Bureau predicting that nearly a quarter of Americans will be 65 or older by 2060.
Email Aaron Zitner (aaron.zitner@wsj.com), Jon Kamp (Jon.Kamp@wsj.com), and Brian McGill (brian.mcgill@wsj.com).
