THE SUSTAINABLE BUDGET PROJECT - Americans for Tax Reform

​In 2023, Americans for Tax Reform launched The Sustainable Budget Project, a new venture that monitors state government spending and tracks which states have or have not enacted sustainable budgets.

The Sustainable Budget Project defines a sustainable budget as one that limits the pace of state government spending to lower than the rate of population growth plus inflation, which accounts for the average taxpayer’s ability to pay for government spending. 

• The Sustainable Budget Project looks at the changes in state government spending over the past decade and next year. The findings illustrate how, in most states, overspending is the problem, not under-taxation.

From 2013 to 2022, the following happened:

• Federal spending shot up by 69.4%, more than three times faster than the 21.6% increase in the rate of population growth plus inflation.

• Had the federal government limited the growth in spending to the rate of population growth plus inflation during that decade, the federal government would’ve spent $1.6 trillion less in 2022 than it did.

• If the federal government had done this over the entire decade, the national debt would have increased by less than $500 billion instead of $19 trillion. 

Aggregate state spending, excluding funds received from the federal government, by the 50 state governments increased by 51.7% during that period. 

• Had their spending grown in line with the rate of population growth plus inflation during the past decade, state governments would’ve spent $1.39 trillion in 2022, $344 billion less than the $1.74 trillion that all state governments spent. 

Result: American taxpayers could have been spared more than $2 trillion in taxes and debt if federal and state governments had grown no faster than the rate of population growth plus inflation during the previous decade.  

There four states that held growth in state funds and all funds below the rate of population growth plus inflation over the last decade, thereby keeping taxes lower than the average taxpayer can afford:

• Alaska
• Colorado
• West Virginia
• Wyoming

There are seven states that held growth in state funds, but not all funds, below the rate of population growth plus inflation over the last decade, thereby keeping taxes for state funds lower than the average taxpayer can afford.  

• Connecticut
• Louisiana
• Massachusetts
• Montana
• North Carolina
• Oklahoma
• Texas

There is the one state that held growth in all funds, but not state funds, below the rate of population growth plus inflation over the last decade, thereby keeping taxes for all funds lower than the average taxpayer can afford.

• Mississippi

Go to ATR's Sustainable Budget Project to find out the following information:

• How government spending has changed in each state for all funds (including federal funds) and state funds (excluding federal funds) over the past decade,
• How the change compares to the rate of population growth plus inflation,
• What the dollar amount of the upcoming budget would need to stay below to be classified as a sustainable budget, and
• How each state compares with other states and other helpful fiscal and economic facts.

Originally posted at Americans for Tax Reform.