The passage of President Trump’s “Big, Beautiful” bill represents a revolutionary realignment of the 60-year long relationship between the federal government and states when it comes to education, health care, and other programs serving the American people.
Ironically, it is a revolution that hurts the states most loyal to Donald Trump. That’s because for decades Trump states have been most dependent on federal financial support. In turn, the federal subsidies they receive have given them the benefit of keeping their taxes low.
Idaho is a prime example of one of those states that has historically benefited financially by the previous state-federal relationship and will now face challenges under Trump’s new federalism.
Nine of the top 10 states most dependent on federal financial support are Republican states. They include in order of dependency Alaska, Kentucky, West Virginia, Mississippi, South Carolina, Louisiana, Arizona, Indiana, and Alabama, according to WalletHub. The only blue state in the top 10 dependent states is New Mexico. Meanwhile, WalletHub reported in March that Idaho is the 20th most dependent state on federal support.
Seven out of the 10 least dependent states on federal support are blue states that Idaho’s political leaders have built careers denigrating. In order of independence from federal largess are New Jersey, California, Delaware, Massachusetts, Washington, Illinois, Colorado, and Connecticut. The only red states that make that list are Utah, Iowa, and Kansas, even though two of those states are dependent on federal farm subsidies and the third enjoys a financial boost from tourists who visit the public’s national parks.
Another way to illustrate this dependency is to consider how much each state receives from the federal government for every tax dollar it sends in. For example, California receives 88 cents for every dollar it sends to Washington, New Jersy 82 cents and Washington State 87 cents, according to the Rockefeller Institute of Government. Meanwhile, Alaska gets $2.65 for every dollar it sends to Washington; South Carolina $1.60, West Virginia $2.91, Mississippi $2.39, Alabama $2.
Depending upon the year, Idaho has received $1.15 to $1.69 for every dollar it sends to the federal government. That is a return on investment that any business would love to have. But our current political leaders have scorned the feds while gladly taking the money.
In 2022, Idaho received $5.7 billion from the federal government. That represented 28 percent of all the spending by Idaho’s state government, schools, and local governments, USA Facts reported. During the 2021-22 school year 18.2 percent of Idaho’ K-12 spending – or $660 million – came from the federal government, higher than the national average, according to National Center for Education Statistics.
That included money for free and reduced lunches and breakfasts for hungry students, Title 1 support for low-income students, and special education, among other services. Idaho’s rural school districts especially rely on federal funds to run their schools.
For example, consider Governor Little’s hometown district in Emmett, which gets 25.4% of its funding from the federal government. Nearly all of Idaho’s other school districts have a similar dependency on federal dollars. A few examples are Kellogg (27.5%), Payette (30%), Mountain View (28%), and Cascade (33.5%).
Meanwhile, the red states most dependent on federal financial aid have the lowest tax rate in the country, meaning that taxpayers in states like California, New York, New Jersey, and Washington State subsidize their programs. Idaho also fits this profile. Depending on the source, Idaho has the 4th or 7th lowest state and local tax rates in the country.
In short, federal support allows Governor Little and the Idaho Legislature to keep its taxes low, while the federal government subsidizes programs like education, health care, nutrition for students and seniors, and infrastructure.
THE PROBLEM WITH TRUMPISM
But here’s the problem with Trumpism, which Governor Little, our Legislature, and our congressional delegation praise. The “big, beautiful” bill Congress recently passed with the help of Idaho’s congregational delegation and Governor Little celebrated cuts $800 billion from the Medicaid budget.
In Idaho more than 350,000 Idahoans, or 29 percent of our people, were on Medicaid in 2024. One out of four citizens in counties like Shoshone, Benewah, Washington, Payette, Elmore, Jerome, Power, and Madison were recipients of Medicaid, according to Georgetown University’s McCourt School of Public Policy. Moreover, half of all births in Idaho are paid for by Medicaid.
The $800 billion cut in Medicaid will likely cause 40,000 Idahoans to lose their health insurance, according to a recent story in the Idaho Capital Sun. Thousands of those will be children.
“Cutting Medicaid is equivalent to cutting school district budgets,” said Jesse Mandle, program director of the Healthy Schools Campaign.
The “big beautiful” bill also cuts $300 billion from the Supplemental Nutrition Assistance Program or SNAP. Thirteen million children in the country and thousands in Idaho depend on that for free and reduced school lunches.
“When you take it all together it’s kind of like an assault on children and families . . .” Megan Curran, director of the Center on Poverty and Social Policy at Columbia University told Chalkbeat.
Adding insult to injury, President Trump just announced that he is holding back $7 billion in education funding that Congress has already approved and plans to make the cuts permanent. It will cut funding for after school programs for low-income students, community learning programs, teacher professional development and English learning programs.
In all, Idaho will lose $36.5 million because of this funding holdback, according to Education Week.
THE TIMING OF TRUMPISM IS AWFUL FOR IDAHO
Here is the real problem facing Gov. Little and the Idaho Legislature – the timing of Trumpism couldn’t be worse for Idaho.
Gov. Little and the Legislature have cut taxes by $4.6 billion since 2019. Just last winter they added to that by passing the largest tax cut in Idaho history – $453 million. And, like President Trump’s “big, beautiful” bill most of the money will go to the wealthiest citizens which already control 70 percent of the wealth in the United States.
As a result of these tax cuts and a slowing economy, tax revenue is not coming in as much as the Legislature predicted so Governor Little is telling state agencies, including public education, to expect budget cuts ranging up to 6 percent this fiscal year.
The state’s financial predicament was made even worse when Governor Little decided to fund yet another school system in the state with a $50 million voucher tax credit so that Idahoans can send their kids to private and religious schools.
With Trumpism cutting financial support for Medicaid and SNAP and many other services Idahoans depend on, Governor Little and the Legislature face a Solomon-like decision. Do they replace the funding that the federal government is cutting, or do they tell Idahoans to go without food and health care insurance? Do they tell students and teachers to just do without, or do they replace the education funding Idaho is losing?
Gov. Little sent out a press release on Friday saying the state had a healthy surplus of $345 million at the end of the last fiscal year on June 30. And it is true that Idaho has a sizeable rainy-day fund.
But, as Gov. Little knows, rainy-day funds are meant for emergencies, not ongoing expenses. Over the long run rainy-day funds cannot replace the billions in revenue that Governor Little and legislators cut from the general fund or replace the millions of federal dollars lost under President Trump’s new federalist policies.
It is truly ironic that Idaho’s political leaders are like the dog that catches the car. They always wanted more power and control. But what do they do now? Hopefully, they have not forgotten that with more power comes more responsibility. Idahoans, especially our children and most vulnerable citizens, are now depending upon them more than ever.
So far Gov. Little and legislative leaders have been amazingly silent on the gathering storm facing the citizens of our state. The governor, who sent out a press release praising passage of the “big, beautiful” bill, has said nothing about how he plans to support Idahoans who will lose Medicaid or the hungry school kids who will lose food. Nor has he challenged the president for holding back $36 million of congressionally approved education funding from Idaho.
But one thing is certain, silence or not, our political leaders must live with the seeds they have sown. Unfortunately, so do thousands of Idaho’s citizens.
