A Political Stimulus, Not A Job Stimulus

I received many emails on Friday and this weekend about the data published here showing that on average Democratic districts are getting almost twice the amount of stimulus money than Republican districts. Republican districts also received smaller awards on average. The average dollars awarded per Republican district is $260,675,663, while the average dollars awarded per Democratic district is $471,533,539.

Several readers asked if the difference could be explained by the fact that Democratic districts have many more people than Republican districts have. So I looked at the numbers and here is the result. It’s not.

Republican districts get $362 per capita on average

Democratic districts get $692 per capita on average

Also, on average, Democratic districts received one-and-a-half times as many awards as Republican ones. Democratic districts also received two-and-a-half times more stimulus dollars than Republican districts ($122 million vs. $46 million). Of course, there are more Democratic districts than Republican districts in the Congress.

Is the politics part of the allocation decision?

Well I checked for the correlation between political indicators and stimulus funding. I found that there are no effect of political variables (leadership, tenure in office …) on stimulus funds allocation with one exception: the district’s party affiliation (whether the district’s representation was Republican or Democratic) does matter.

So how much does party affiliation mattered? While the effect is significant, because of the specifications of the model, more confidence should be placed on the relationship between the two variables then on the quantification of that relationship. In other words, while I am confident that whether the district is represented by R or D matters for funding, I just can’t tell you how much this factor matters compared to the other factors that went into the allocation decision.

On the other hand, I can tell you what factor was not a part of the allocation decision: the level of unemployment in each district or the deterioration of unemployment in each district. In other words, unemployment levels didn’t matter. That’s not what the money was supposed to address. Or was it?

Here is a chart to illustrate this point. As you can see the districts where unemployment increased the most during the recession aren’t receiving more money that the ones that were hit more lightly.

All the data is available for download here. (Ignore the picture)