All things considered, Rhode Island is probably better off as part of the United States of America than it would be as an independent country. But we pay for the privilege.
Rhode Island paid $145.6 billion in federal taxes between 1990 and 2009 and got back $139.7 million in federal spending, according to some number-crunching by The Economist. Rhode Island’s fiscal transfer of $6 billion to the rest of the nation was equal to about 8% of the state’s 2009 gross domestic product.
Compared with most other states, America’s fiscal union was close to a wash for Rhode Island. Only New Hampshire transferred a smaller share of its GDP to other states, at 8%, while Massachusetts transferred 41%. Delaware gave the most and New Mexico took the most (excluding Puerto Rico).
Unlike Europe, “America has a real national politics,” Slate’s Matt Yglesias notes. “People think the important question is whether senior citizens get Medicare benefits and which income bracket pays the taxes, not where the seniors are geographically located.”
On a related note, this is also part of the reason why Rhode Island isn’t Greece – the stronger economies in other states have helped pay for federal social programs such as Medicare, unemployment insurance and food stamps that Rhode Islanders are relying on to weather the downturn. E.J. Dionne discusses that here.