The tax foundation put together this map based on the cost of living in every state.
How do I exchange my New York dollars for Mississippi dollars?
(via Tax Foundation)
It's no secret that the cost of living in the U.S. is increasing much faster than wages are. But this trend isn't consistent across the whole country. Recent data released by the Bureau of Economic Analysis reveals a wide disparity in the value of a dollar from state to state. This should come as a comfort to people from the heartland who are tired of being condescended to by New Yorkers and Californians: those jerks are being ripped off for everything.
The Tax Foundation, a nonprofit research organization, took the Bureau's data and created this map, showing the relative value of $100 in every state as compared to the national average. The rankings of the states aren't that surprising, but the difference between them is. The state with the lowest cost of living is Mississippi, where $100 is worth $115.21. The highest cost of living, in contrast, is in Washington, D.C., where $100 is only worth $84.96. That's a 36% difference in the purchasing power of the same unit of currency. To put it another way, someone who made $50,000/year after taxes in Mississippi would have to make $68,000 in D.C. to afford the same lifestyle.
Here's the map chopped up into pieces for easy reading (don't say we never did you any favors):
God's Country. (via Tax Foundation)
Flavor Country. (via Tax Foundation)
Gator Country. (via Tax Foundation)
The rest. (via Tax Foundation)
Here are the five states where $100 is worth the most:
Mississippi – $115.21
Arkansas – $114.29
South Dakota – $114.21
Alabama – $114.03
West Virginia – $113.12
And here are the four states and one district where $100 is worth the least:
Washington, D.C. – $84.96
Hawaii – $86.06
New York – $86.73
New Jersey – $87.34
California – $89.05
The conclusion is clear: living near the ocean is expensive. The more landlocked you are, the more you'll save.
The Tax Foundation points out that this undercuts a lot of our assumptions about wealth in America. Although rural interior states have lower average wages, the correspondingly low cost of living means that the people there are effectively wealthier. For example, Nebraskans have more purchasing power than Californians on average:
But can you get a green juice in Nebraska? Yes, and it's much cheaper.
(via Tax Foundation)
The Foundation points out that this data should be better used in determining economic policies. The government's current math is only based on the numerical value of dollars. The article points out:
Many policies – like minimum wage, public benefits, and tax brackets – are denominated in dollars. But with different price levels in each state, the amounts aren't equivalent in purchasing power. This has some unexpected consequences; people in high-price-level states like New Jersey will often pay more in federal taxes without feeling particularly rich.
I'm from New Jersey, and I can attest to that. I never felt rich until I traveled to the South and realized I could live like a king down there on the same salary. You know why I came back? I don't.