Friday, July 11, 2014

Most Corrupt States are Controlled by Republcans

A 2011 study of corruption in the U.S. has reached some alarming conclusions. The study used a single factor to determine the level of corruption in a state, namely, the number of officials convicted of corruption over the past several years. There were 25,000 corruption convictions between 1974 and 2008. Corruption trials are all prosecuted under federal laws, which do not vary from state to state and do not favor one party over another. Therefore, a corrupt state official cannot influence his own trial. 

Political corruption results in higher state expenditures. The same study found that states with higher levels of corruption spent an average of $1,300 per resident per year more than they would have with only average levels of corruption. The state of Mississippi, which the study rated most corrupt in the U.S., therefore lost $3.8 billion due to corruption of its officials.

Corrupt states spend more money on construction, capital, and highway projects, because these projects are undertaken by large, monopolistic enterprises. When only one or two companies bid on a project, it is hard to tell whether the bid is inflated by payoffs to politicians. Corruption often takes the form of subsidies to sports franchises for locating in a city or constructing a new stadium. Miami-Dade County paid $337 million to build a stadium for a baseball team. Ultimately, the taxpayers of Miami-Dade will pay at least $2.6 billion to pay of the bonds sold to finance construction. The stadium primarily benefits the owner of the team, Jeffrey Loria, whose estimated net wealth is $500 million. Corruption in these sorts of deal is difficult to prove, but Florida is the tenth most corrupt state on the list.

Government corruption leads to expenditures on capital projects like the Marlins stadium. The budget increases are offset by cuts elsewhere, usually in health and education. In Miami, Florida, the Mayor of Miami-Dade County cut 36 positions for fireboat crews. He also demanded that the fireboat crews should also be cross-trained in emergency rescue, which the union refused to do. The dispute led to shutting down one fireboat.

On the evening of July 4, 2014, a 3-boat collision led to 4 fatalities. The unmanned Miami fireboat, which might have responded and rescued one or more victims in the water, stayed in port. The unmanned fireboat may or may not have saved anyone that night. The stadium deal may not have involved corruption. One fact is clear: The Miami government was able to give $337 million to millionaire Loria, but could not find the funds to pay firefighters.

The most disturbing aspect of this survey is the correlation between the level of corruption and a state's adoption of the Republican Party platform. For example, the study concludes that favoring tax cuts over incremental tax raises correlates with a state's corruption. In other words, the motto, “no new taxes” may invite corruption.

The study says that corrupt state governments tend to hide their excesses by engaging in deficit financing. A popular way for governments to raise revenues for capital projects is tax increment financing (TIF). This form of funding does not increase budgets, but it does lead to abuses. TIF is used to fund redevelopment projects, with the money going to large, politically connected construction companies. Redevelopment projects are supposed to help residents of blighted districts, but they frequently result in gentrification, when richer residents move into the redeveloped districts and the poorer residents are forced out. The money raised goes to the corporations and taxpayers eventually pay the higher cost of services demanded by the new residents.

Policies of Republicans, who favor cutting taxes and awarding contracts on favorable terms to corporations, have caused Republican-governed states to experience more corruption. Here is a list of the ten most corrupt states and the political parties that control them. The list comes from the study and the political party control statistics come from Multistate Associates Incorporated.

Ten most corrupt states Mississippi, Louisiana, Tennessee, Illinois, Pennsylvania, Alabama, Alaska, South Dakota, Kentucky, and Florida.

Rank.   State name      Governor's Party       State Senate Party       State Assembly Party

  1. Mississippi        R                               R                                 R
  2. Louisiana          R                               R                                 R
  3. Tennessee         R                               R                                 R
  4. Illinois               D                              D                                 D
  5. Pennsylvania     R                              R                                 R
  6. Alabama            R                              R                                 R
  7. Alaska               R                              R                                 R
  8. South Dakota    R                              R                                 R
  9. Kentucky          D                              R                                 D
  10. Florida              R                               R                                 R

There are 30 power bases listed in this table. 25 (83%) of them are controlled by Republicans. This is the type of figure you would expect to see if the correlation between corruption and Republican policies is true.

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