Wyoming Feels Neglected By Stimulus As Administration Says State's Economy To Blame

(MoneyWatch)  The State of Wyoming feels that the Federal Government is not providing it a fair share of U.S. Forest Service (USFS) funding. This is not just the regular funding done through the proper appropriation process but also the money given to that Service as part of the "Stimulus" bill. Illustrating that paranoia is a good part of the state and national government relationship, Governor Freudenthal and the state's all Republican Congressional delegation accuse the Obama Administration of punishing them for not supporting the bill.

Considering that Arizona was threatened with the loss of stimulus funds after Senator Kyl (R-AZ) levied the criticism that the bill with all of its debt and spending was not working to create jobs. Within a few days of the reports of his statements five separate Federal Departments informed the Governor and the State of all the stimulus funds they were entitled too and could lose. This episode continues to illustrate that the states will be happy to take all the money they can get from the Federal taxpayer even if they don't think the original source was a good idea.

Wyoming it turns out is not receiving a great deal of stimulus funds because its economy is so good. The low unemployment in the state has not made it a priority for receiving the funds. Of course if the allocation was done strictly by unemployment rates then Michigan and other Midwest states would be seeing the most money but right now that is not true either. If you look at Recovery.org the funds seem to be more related to population other then Washington which throws everything off with the big Hanford clean up contract.

This distribution makes sense as a great deal of the money in the original bill is going to pay for Medicaid, education and to prop up state spending. Much of the formulas for this distribution is done through population and that would cause the stimulus funds to be distributed in the same way.

One of the criticisms of the progressive tax systems that the U.S. and state government uses is that rich parts of the state subsidize poorer ones. If there was not a general belief that government is misusing their funds it would not be such a big deal as that is part of the social contract that the U.S. is built on. It is just that areas like Northern Virginia outside Washington D.C. which provide a big part of the state's revenue feel that more of that money should come back to them to improve their quality of life rather then going to the economically depressed Southwest.

These kind of arguments will continue as the various states will feel that they are missing out on what is essentially free money to them. All fifty states and the dependencies have needs that the stimulus dollars are able to meet and all will feel short changed one way or another.