Does Colorado Fail to Spend State Taxes on Services?

Policy debates frequently turn on whether the government is spending at a reasonable level, and that is defined by the relative spending in other states. Relatively low rankings are presumed to indicate of under-spending by Colorado governments. The low rankings, however, are inconsistent with Colorado’s overall ranking for tax burden, which is close to the national median. The proper rankings should approximate the demand for the public service. Personal income fails this test; higher income can actually lead to lower demand for many government programs. Without market forces, the government can never truly know if it is providing the right amount of services. Also, many of these rankings do not include local spending, which can unfairly bias results, because in Colorado a disproportionate amount of government spending is done at the local level. The low rankings are deceptive and inappropriate, and do not support drastically increased spending.

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