How Blue America Subsidizes Red America (Matt Yglesias)

[swag]

http://www.slate.com/blogs/moneybox/2012/02/14/how_blue_america_subsidizes_red_america.html



A very neat Aaron Carroll chart shows that, on average, conservative states feature more "dependency" on federal programs than do liberal ones. You can slice this kind of data in a variety of ways, but you always end up with the same aggregate pattern. It happens to be the case that the richest parts of the United States (think the San Francisco Bay Area or Connecticut) favor Democrats and also that conservative areas of the country are overrepresented in the Senate. Transfers, on average, flow away from high-income and underrepresented areas and toward low-income and overrepresented areas. I think the overall pattern is best described as a coincidence and not a pattern of large-scale hypocrisy but there are two important points to make about it.

One is that high-income people living in low-income states are generally very conservative in their political ideology but probably benefit more from federal income support programs more than they realize. If you own fast food franchises in the Nashville area, for example, you're going to form a self-perception as a self-reliant businessman but the existence of Medicaid and the Earned Income Tax Credit are helping to ensure that your customers have adequate income to sometimes eat at your Taco Bell. These chains of dependency snake even longer. If you sell luxury cars in Florida, many of your customers are probably medical professionals who are earning high incomes because other people have Medicare benefits. The aggregate geographic transfer patterns, in other words, do make a real difference to the economic life of the nation. The existence of transfer payments props up the entire local economies of low-income, low-productivity parts of the country.

[northoftheborder]

1. Very interesting!!!

[DCKit]

2. You can't exactly blame them. Name one other parasite that is aware...

that it's a parasite.

[Ron Obvious]

3. Not surprising

This shouldn't be a surprise to anyone who's lived in both kinds of places.