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How Much Does State Government Cost Each Oregonian?

Steve BucksteinCascade Commentary

Summary

Ask even reasonably knowledgeable people how big the Oregon state budget is this biennium, and they likely will tell you that it’s around $15 billion, which is actually just the General Fund. The All Funds Budget is $48 billion—$6,376 per year for every man, woman and child in Oregon. Taxpayers deserve to know exactly how much their government is spending.

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State budgets are often hard to find online, or anywhere else. And when found, they are often not transparent. Part of the problem is that budgets are usually stated in numbers so large that it is hard to put them in perspective.

“…[State] budgets are usually stated in numbers so large that it is hard to put them in perspective.”

Ask even reasonably knowledgeable people how big the state budget is this biennium, and they likely will tell you that it’s around $15 billion, which is actually just the General Fund (mainly funded by state income taxes) and state lottery revenue. This is the money that the legislature has the greatest discretion to spend where it sees fit on things like education, health care and corrections.

The total state budget is known as the All Funds Budget. It includes the General Fund, lottery revenue and all other funds including state gas taxes, federal funds for Medicaid, higher education tuition revenue and other fees. Just how big is the All Funds Budget? Recently, a candidate for statewide office told a Portland audience that he thought the All Funds Budget was twice as big as the General Fund, or about $30 billion. Unfortunately, he was wrong.

That $30 billion figure would have been pretty accurate if the All Funds Budget had just grown with inflation and population since 1985. But it grew much faster than that. So, rather than being $30 billion this biennium, the All Funds Budget is actually $48 billion.

“…[T]axpayers deserve to know what all levels of government cost us, on an annual basis, and in terms that are transparent and easy to understand.”

State Representative Kevin Cameron (Salem) has done Oregonians a great service by putting together a chart showing how the All Funds Budget has grown over the last two decades, adjusted for population increases. The revised chart below uses his numbers and also calculates how much smaller the All Funds Budget would be per person if it had grown only at the rate of inflation.

The chart makes the state budget much more transparent and useful for average citizens. $48 billion means little to the average person. Showing us that state government is now spending $6,376 per year for every man, woman and child in the state is something we can get our arms around. That’s $12,752 per couple per year and $25,504 per family of four each and every year. And these numbers are for state government only. Cities, counties, school districts, etc., add much more to the government spending pie.

Taking Rep. Cameron’s chart one step further, the final column below makes clear that if the All Funds Budget had grown just with inflation and population since 1985, today it would be around $3,850 per person per year, not the $6,376 that it actually is. That restraint could have left over $2,500 each year from now on in people’s pockets, rather than in government’s.

Putting government budget numbers in perspective is important. We still can have policy debates about how appropriate or effective specific government programs are. But taxpayers deserve to know what all levels of government cost us, on an annual basis, and in terms that are transparent and easy to understand.

Oregon All Funds Budget per Biennium and per Person per Year 1985-2009
Biennium All Funds Budget per biennium Population Actual dollars per person per year Dollars per person per year if budgets grew only at rate of inflation
1985-87 $12,060,094,718 2,690,000 $2,242
1987-89 $12,570,014,958 2,791,000 $2,252 $2,400
1989-91 $15,174,994,031 2,927,800 $2,592 $2,600
1991-93 $17,866,757,268 3,059,110 $2,921 $2,750
1993-95 $20,042,060,862 3,182,690 $3,149 $2,900
1995-97 $23,218,655,377 3,302,140 $3,516 $3,050
1997-99 $27,308,692,023 3,393,410 $4,024 $3,150
1999-01 $30,462,319,439 3,471,700 $4,387 $3,250
2001-03 $35,508,990,712 3,541,500 $5,013 $3,400
2003-05 $38,743,009,114 3,631,440 $5,334 $3,550
2005-07 $43,220,555,200 3,690,505 $5,856 $3,700
2007-09 $48,005,409,654 3,764,684* $6,376 $3,850
All Funds Budget includes General Fund, Lottery, Federal, Other (fees)
Budget numbers from Legislative Fiscal Office as provided to Rep. Kevin Cameron
Population data from Population Research Center, College of Urban and Public Affairs, Portland State University
*2007-2009 population projected at 1% annual growth
Revised from handout produced by Rep. Kevin Cameron, 2007 (rep.kevincameron@state.or.us)

Final column calculated and rounded by Steve Buckstein, based on GDP Price Deflator, St. Louis Fed.

 

Founder and Senior Policy Analyst at Cascade Policy Institute, Steve Buckstein is Director of Cascade’s Government Transparency Project and the Oregon Economic Opportunity Project. Based in Portland, Cascade Policy Institute is Oregon’s free market think tank.

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