Every year, Americans send trillions of dollars to Washington through income taxes, payroll taxes, corporate taxes and other federal revenues. The federal government then sends trillions back across the country through Social Security, Medicare, Medicaid, military spending, federal salaries, contracts, grants, infrastructure projects and dozens of other programs.

But the money doesn’t necessarily return to the states in the same proportions in which it was collected.

That’s where the terms “donor state” and “recipient state” come in.

What Is a Donor State?

Simply put, a donor state sends more money to the federal government than it receives back in federal spending.

Imagine taxpayers and businesses in a state contribute $100 billion to the federal government during a year. If federal spending within that state totals only $80 billion, the state has effectively contributed $20 billion more to the federal government than it received.

A recipient state experiences the opposite: federal expenditures within the state exceed the amount collected there in federal revenue.

These aren’t official federal government classifications, however. They’re terms commonly used by researchers analyzing the flow of money between individual states and Washington.

Only Three Donor States in 2023?

According to an August 2025 analysis from the Rockefeller Institute of Government using preliminary federal fiscal year 2023 data, only three states had negative balances—meaning they contributed more federal revenue than they received in federal expenditures.

Those states were:

New Jersey: approximately $18.9 billion more contributed than received.

Massachusetts: approximately $6.8 billion more contributed than received.

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Washington: approximately $54 million more contributed than received.

At first glance, that might suggest nearly every other state depends financially on those three states.

The reality is considerably more complicated.

COVID Changed the Numbers

Historically, several wealthy states—including California and New York—have frequently appeared on the donor side of the equation.

The enormous federal response to the COVID-19 pandemic disrupted that pattern.

Trillions of dollars in extraordinary federal spending flowed into states through stimulus payments, business assistance, unemployment programs, healthcare funding, state and local government assistance and other programs.

Even after the emergency phase of the pandemic ended, some of those expenditures continued influencing federal balance-of-payments calculations.

That’s one reason examining a single year can produce a misleading picture.

California: Recipient Today, Historical Donor

California provides perhaps the best example.

In fiscal year 2023, California technically received slightly more federal spending than it contributed—approximately $342 more per person.

But look at the longer-term numbers and the picture changes.

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Using a nine-year average that excludes COVID-related spending, Rockefeller Institute researchers calculated California’s average balance at approximately negative $29 billion.

In other words, over a more typical period, California has historically contributed substantially more to the federal government than it received.

Its enormous economy, high incomes and large number of taxpayers generate tremendous amounts of federal revenue.

New York Tells a Similar Story

New York has also historically ranked among America’s major donor states.

Yet in 2023, New York had a positive federal balance of approximately $13.3 billion, receiving roughly $1.04 in federal expenditures for every $1 it contributed.

Researchers attributed much of the change from New York’s historical pattern to lingering pandemic-era federal expenditures.

As those programs disappear from the calculations, New York could return to its traditional position as a donor state.

Arizona Is a Net Recipient

Arizona presents a different picture.

Over the Rockefeller Institute’s nine-year analysis, Arizona averaged a positive federal balance of approximately $44.5 billion.

Even after excluding COVID-related spending, Arizona’s average remained positive at roughly $35.3 billion.

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That means federal expenditures flowing into Arizona have substantially exceeded federal revenue collected from the state.

But that doesn’t mean Arizona simply receives tens of billions of dollars in “welfare.”

Federal spending includes far more than public assistance.

Arizona hosts military installations, federal lands and agencies, defense and aerospace operations, veterans programs and a significant retiree population receiving Social Security and Medicare.

All of those expenditures count toward the state’s federal balance.

Texas Receives More Than It Sends

Texas also had a substantial positive balance in 2023.

Federal expenditures exceeded revenues collected from Texas by approximately $80 billion, making it one of the country’s largest net recipients in total dollars that year.

Again, the number needs context.

Texas is home to major military installations, NASA operations, defense contractors, federal infrastructure projects and millions of Social Security and Medicare recipients.

Those federal dollars all count as money flowing back into the state.

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The Surprising Leader: Virginia

If recipient-state status simply meant dependency on federal welfare programs, Virginia would seem like an unlikely candidate to lead the country.

Yet Virginia recorded the nation’s largest positive federal balance in 2023 at approximately $145.4 billion.

Why?

Location.

Virginia sits next to Washington, D.C., and contains an enormous concentration of federal employees, military installations, government contractors and defense spending.

Neighboring Maryland ranked second with a positive balance of approximately $81.1 billion.

The numbers illustrate why federal balance-of-payments statistics should not automatically be interpreted as measurements of welfare dependency.

A recipient state isn’t necessarily a “welfare state.” Federal expenditures include Social Security, Medicare, military installations, defense contracts, federal salaries, research, infrastructure, grants and other programs.

Where Does the Federal Money Actually Go?

Federal expenditures flowing into a state can include:

• Social Security
• Medicare and Medicaid
• Military bases and personnel
• Defense contracts
• Federal employee salaries
• Highway and transit funding
• Scientific and university research
• Agricultural programs
• Veterans benefits
• Disaster assistance
• Federal grants
• Infrastructure projects
• Federal agency operations

A state containing a large military installation, federal laboratory or government agency can therefore receive billions of federal dollars without that money having anything to do with traditional public assistance programs.

Why Wealthier States Often Become Donors

Federal income taxes are progressive.

People with higher incomes generally pay a larger percentage of their income in federal income taxes.

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States containing large concentrations of high-income households and highly profitable companies can consequently generate enormous amounts of federal revenue.

That helps explain why states such as California, New York, New Jersey and Massachusetts have historically appeared frequently among net contributors.

The federal government doesn’t earmark the taxes collected in California exclusively for California.

The money enters the national treasury and helps finance programs throughout the United States.

In that sense, federal taxation intentionally redistributes resources geographically as well as economically.

So Are Donor States “Subsidizing” Recipient States?

In a broad accounting sense, yes.

Federal revenue collected disproportionately from some states helps finance federal expenditures occurring elsewhere.

But describing the relationship simply as one state “paying for” another leaves out important context.

Federal spending follows national priorities rather than state borders.

A Navy base in Virginia protects the entire country. NASA facilities in Texas conduct missions funded by taxpayers nationwide. Social Security benefits paid to a retiree in Arizona may reflect payroll taxes that person paid while working decades earlier in California, Illinois or New York.

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Americans and businesses also move between states throughout their lives.

The federal system was never designed to ensure that every dollar collected within a state’s borders would eventually return to that same state.

The Bigger Picture

The donor-state debate is often used as political ammunition, particularly when politicians argue about which parts of the country are supporting others.

The numbers are real, but they require context.

A state can move from donor to recipient status because of a recession, natural disaster, military spending, demographic changes, infrastructure investments or extraordinary events such as the COVID-19 pandemic.

That’s why examining several years of data generally tells us more than looking at a single year.

Ultimately, the donor-versus-recipient calculation reveals something fundamental about the United States:

Federal taxes don’t remain where they’re collected.

They become part of a national pool used to fund programs, obligations and investments across all 50 states.

And depending on where you live, your state may be putting more into that pool—or taking more out—at any particular moment.

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Related External Links

• Rockefeller Institute of Government – 2025 Balance of Payments Report
• USAspending.gov – Explore Federal Government Spending
• USAspending.gov – Federal Spending Guide
• IRS – Individual Income Tax Data by State
• IRS – Federal Taxes Collected by State

🍽️ Love discovering great food and drink? Join the conversation! Share your thoughts in the comments and subscribe to the STM Daily News newsletter for the latest recipes, restaurant news, food trends, and culinary stories delivered straight to your inbox.

Last Updated on August 2, 2026 by Daily News Staff

On December 3, 1967, medical history was made in Cape Town, South Africa, when surgeon Dr. Christiaan Barnard performed the world’s first successful human-to-human heart transplant.

The groundbreaking operation took place at Groote Schuur Hospital and changed what doctors believed was possible.

A New Heart for Louis Washkansky

The recipient was Louis Washkansky, a 53-year-old grocer suffering from severe heart disease. His condition had deteriorated to the point that conventional treatments offered little hope.

The donor was Denise Darvall, a 25-year-old woman who suffered catastrophic brain injuries after being struck by a car. With permission from her father, her heart was donated to Washkansky.

Barnard and his surgical team removed Washkansky’s failing heart and replaced it with Darvall’s healthy heart. When the transplanted heart began beating inside its new recipient, a new era in medicine had begun.

He Survived Just 18 Days — But the Operation Was a Success

Washkansky survived for 18 days following the transplant. He ultimately died from pneumonia.

One of the greatest challenges wasn’t simply performing the surgery—it was preventing the recipient’s immune system from rejecting the transplanted organ. The drugs used to suppress Washkansky’s immune response also left him extremely vulnerable to infection.

Despite his short survival, the operation demonstrated that transplanting a human heart was possible.

The Science Behind the Breakthrough

Barnard’s achievement didn’t happen in isolation. Researchers and surgeons around the world had spent years developing the techniques that made heart transplantation possible.

Among the pioneers was American surgeon Dr. Norman Shumway at Stanford University, whose extensive experimental work on heart transplantation helped establish many of the surgical techniques used in the procedure.

Just weeks after Barnard’s historic operation, Shumway performed the first successful adult heart transplant in the United States in January 1968.

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Over the following decades, improved surgical techniques and increasingly effective anti-rejection medications transformed heart transplantation from an experimental procedure into an established treatment for certain patients with end-stage heart failure.

A Medical Milestone

Today, thousands of heart transplants are performed around the world each year, and many recipients survive for years or even decades after receiving a donor heart.

What began with a daring operation in Cape Town in December 1967 helped open the door to an entirely new field of medicine.

The Knowledge: The first successful human-to-human heart transplant was performed by Dr. Christiaan Barnard on December 3, 1967, at Groote Schuur Hospital in Cape Town, South Africa. The recipient, Louis Washkansky, lived for 18 days after the historic procedure.

The Knowledge is an STM Daily News series exploring the inventions, discoveries, people and moments that helped shape the world we live in today.

Related Links

• University of Cape Town: The World’s First Human Heart Transplant — Learn more about Dr. Christiaan Barnard, Groote Schuur Hospital and the medical team behind the historic 1967 operation.
• University of Cape Town: 50th Anniversary of the First Human Heart Transplant — A retrospective marking the anniversary of the world’s first human-to-human heart transplant.
• Stanford Medicine: The First U.S. Adult Heart Transplant — Explore Dr. Norman Shumway’s pioneering research and the first adult heart transplant performed in the United States.
• OrganDonor.gov: Donation and Transplantation History — Review a timeline of major milestones in organ donation and transplantation.
• OrganDonor.gov: Matching Organ Donors and Recipients — Learn how donor organs are matched with patients awaiting transplants.

Forgotten Genius Friday | LA History

When people think about the architects who shaped Los Angeles, names like Frank Lloyd Wright or Richard Neutra often come to mind. Yet one of the city’s most influential designers—and one whose work touches nearly every corner of Southern California—was Paul R. Williams.

From elegant Beverly Hills estates to landmark public buildings, hotels, churches, and even Los Angeles International Airport, Williams helped define the look and feel of modern Los Angeles. Despite facing discrimination throughout his career, he became one of the most successful architects in American history, proving that extraordinary talent can overcome extraordinary obstacles.

From Humble Beginnings to Architectural Greatness

Paul Revere Williams was born in Los Angeles on February 18, 1894. Tragically, he was orphaned by the age of four and was raised by foster parents who encouraged his education and artistic talents.

Even as a young man, Williams dreamed of becoming an architect—a profession that was overwhelmingly white during the early twentieth century. Teachers and classmates reportedly questioned whether Black clients or white clients would ever hire him.

Rather than allowing those doubts to define his future, Williams let his work speak for itself.

In 1921, he became the first African American architect licensed west of the Mississippi River. Two years later, he became the first Black member of the American Institute of Architects (AIA), breaking another significant barrier in the profession.

Designing Around Prejudice

Williams often found himself in uncomfortable situations with clients who were unwilling to sit beside or across from a Black architect.

To adapt, he developed the remarkable ability to draw upside down while standing on the opposite side of a drafting table. This allowed clients to view his sketches from their perspective without having to sit next to him.

The unusual skill became one of his trademarks—not because it made him a better architect, but because it helped him navigate the racial prejudices of the era while continuing to build an extraordinary career.

Building the Image of Los Angeles

Over nearly six decades, Williams designed more than 3,000 buildings.

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His portfolio reflected the incredible diversity of Los Angeles itself.

He designed:

• Luxury homes
• Hotels
• Churches
• Hospitals
• Schools
• Commercial buildings
• Government facilities
• Public housing

Unlike many architects who specialized in a single style, Williams mastered numerous architectural traditions, including Spanish Colonial Revival, Tudor Revival, French Provincial, Mediterranean Revival, Georgian, and Mid-Century Modern.

His flexibility allowed him to meet the changing tastes of Southern California throughout the twentieth century.

Landmarks That Still Define the City

Many Angelenos encounter Paul R. Williams’ work without realizing it.

Among his most recognizable projects are:

The Theme Building at LAX

One of Los Angeles’ most iconic landmarks, the futuristic Theme Building became a symbol of the Jet Age. Williams served as part of the architectural team that helped bring the project to life, creating one of the city’s most recognizable structures.

Golden State Mutual Life Insurance Building

Located in South Los Angeles, this building became one of the most significant examples of Black-owned business success during the mid-twentieth century while also serving as an architectural landmark.

The Beverly Hills Hotel

Williams contributed to renovations and expansions that helped preserve the hotel’s status as one of Hollywood’s most famous destinations.

Celebrity Homes

Williams became known as “The Architect to the Stars,” designing homes for entertainers, athletes, business executives, and political leaders. His clients included Frank Sinatra, Lucille Ball and Desi Arnaz, Barbara Stanwyck, and many others.

More Than Mansions

Although Williams became famous for luxury homes, his career extended far beyond Beverly Hills.

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He believed great architecture should serve entire communities.

His work included:

• Churches that remain community anchors today
• Hospitals serving growing neighborhoods
• Affordable housing developments
• Civic buildings
• Educational facilities
• Military projects during World War II

His influence reached virtually every part of Southern California.

Helping Shape Los Angeles’ Future

Williams didn’t simply design buildings—he helped guide the city’s growth.

He served on the Los Angeles City Planning Commission, contributing to discussions about how one of America’s fastest-growing cities should develop during the twentieth century.

As Los Angeles expanded into the global metropolis we know today, Williams’ work helped create the city’s distinctive architectural identity.

Recognition That Arrived Too Late

Although Williams earned tremendous professional success during his lifetime, many historians believe his contributions were underappreciated for decades.

In 1957, he became the first African American Fellow of the American Institute of Architects.

More than three decades after his passing in 1980, the AIA posthumously awarded him the prestigious Gold Medal in 2017—its highest honor—recognizing a legacy that transformed American architecture.

Today, museums, preservation organizations, and historians continue to celebrate Williams as one of the greatest architects in Los Angeles history.

Why Paul R. Williams Still Matters

Los Angeles is often described through its skyline, neighborhoods, and famous landmarks.

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Paul R. Williams helped create many of those places.

His story is about much more than architecture. It is about resilience, innovation, determination, and excellence in the face of discrimination. Every building he designed challenged assumptions about who could lead, create, and inspire.

For Angelenos, his work remains woven into the city’s identity.

For the rest of us, his life serves as a reminder that some of history’s greatest innovators are hiding in plain sight.

Forgotten Genius Friday Takeaway

Paul R. Williams didn’t just design beautiful buildings—he helped design the modern image of Los Angeles.

His remarkable career opened doors for future generations of architects while leaving behind landmarks that millions of people still admire every year. More than a century after he began his career, his influence continues to shape the city he called home.

Sometimes the greatest architects don’t just build structures—they build history.

🧠 Discover the remarkable innovators, inventors, and trailblazers who helped shape our world but rarely receive the recognition they deserve. Share your thoughts in the comments and subscribe to the STM Daily News newsletter to catch every new Forgotten Genius Friday feature and more inspiring stories delivered to your inbox.

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