Trump's Georgia voter base relies on spending Musk's DOGE might cut

The incoming administration will face stark fiscal arithmetic: Most federal dollars go to direct transfers to Americans, disproportionately located in the very places that propelled President-elect Trump back to the White House.

Why it matters: If the Elon Musk/Vivek Ramaswany-led Department of Government Efficiency is to achieve anything approaching the $2 trillion in annual cost savings they've floated, slashing bureaucrats from the federal payroll or payments to well-heeled contractors wouldn't be enough.

• Rather, that would require cuts to programs on which the counties that backed Trump heavily depend.
• Big-ticket transfer programs operated by the federal government include Social Security ($1.3 trillion in outlays in 2023), Medicare ($1 trillion), Medicaid ($616 billion), income security programs like unemployment benefits and food stamps ($448 billion), and federal employee pensions ($197 billion).
• Mandatory programs like those added up to 69% of non-interest federal spending in 2023. Their combined $3.75 trillion in spending was more than twice as much as defense and non-defense discretionary spending combined ($1.7 trillion).

By the numbers: Researchers at the Economic Innovation Group analyzed county-level data on how much personal income was driven by those federal transfer programs in 2022, as opposed to income earned from wages, investments, and the like.

The big picture: Overall, in the counties most reliant on transfer payments — where they account for more than 25% of all income — Trump won 63% of the vote.

• In those counties least reliant on transfers, accounting for 15% or less of total income, Vice President Harris won 56% of the vote, according to an analysis by Sarah Eckhardt, Connor O'Brien and Ben Glasner of EIG.

Zoom in: In Georgia, counties closer to metro Atlanta saw the lowest reliance on transfer payments while central and south Georgia counties reported higher amounts.

• The counties most reliant on those payments were Quitman, where 47% of income was from government transfers, followed by Calhoun (44%), Clay (43%), Telfair (43%), Johnson (43%) and Hancock (43%).
• The bulk of government transfer payments were Medicaid and Medicare, followed by Social Security.
• Half of those counties voted for Trump, while the other half (Calhoun, Clay and Hancock, which are all majority Black) voted for Harris.
• Quitman, Clay and Hancock also had higher percentages of people who are age 65 or older.

Meanwhile, Forsyth (7%) was the least reliant, followed by Fulton (8.3%), Oconee (10%), Cobb (12%) and Cherokee (13%).

• The share of people in those counties who are over age 65 was much lower than in the counties more reliant on transfer payments.

Context: There are multiple types of counties with high rates of transfer payments. Some, for example, are prosperous places that are popular among retirees receiving Social Security and Medicare.

• Others are more economically distressed, resulting in a greater reliance on Medicaid and income support benefits. In some of these communities, federal transfers account for a massive share of all income.

Zoom out: Owsley County in Kentucky led the nation with 63% of personal income from transfer payments, and it topped 50% in 13 other Kentucky counties. Trump carried the state by almost 31 points.

Reality check: The administrative cost of these programs tends to be a small fraction of the money spent; the overwhelming cost is the benefits themselves. For Social Security, for example, administrative overhead is about 0.5% of total spending.

• That added up to $7.2 billion in 2023 — meaning even if you replaced federal employees with AI customer service bots, the savings would be trivial in the scheme of the whole federal budget.

The bottom line: "The primary drivers of greater transfer spending are an aging society and rising health care costs, not wasteful programs or a radically more generous welfare state," EIG president John Lettieri tells Axios.

• "Therefore, if we want to reverse this trend, we need the nation as a whole to look more like the places that are relatively less dependent on transfers today — areas with strong population and economic growth alike."