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More on Red State Models

David Leonhardt, in part replying to my earlier post on Texas, asks, "why haven’t Democrats had more success in creating model economic policies on the state level?" I was a bit confused by the question, as I don't know of any states conducting large-scale economic policy experiments that regularly enter the debate as a potential model for the rest of the nation. The closest example I could come up with is the Massachusetts health-care reform, which is from a decidedly blue district. And, as the Economist's Ryan Avent says, it's not really clear what this excellent red state model would consist of.

Just taking the most straightforward reading of his question, he's really not making any sense. Rich states in America are overwhelmingly blue, and poor states are overwhelmingly red. The top ten states ranked by gross state product per capita are, in order: the District of Columbia (nearly a state), Delaware, Connecticut, New York, Massachusetts, New Jersey, Alaska, California, Virginia, and Minnesota. The only red state in the bunch is Alaska, which is also an outlier—basically a mini-petrostate and recipient of nearly $2 in federal spending for each $1 in federal tax revenues it provides.

Meanwhile, the states with the ten lowest levels of per capita output are: Mississippi, West Virginia, Arkansas, Montana, South Carolina, Oklahoma, Alabama, Kentucky, Idaho, and Maine. The only blue state in the bunch is Maine.

Now, red states have enjoyed significantly higher rates of population growth than have blue states in recent years, but that is largely explainable in terms of housing affordability and immigration; population growth is not a good proxy for economic success. So the real question, it seems to me, is why haven't Republicans had more success rejuvenating the economies of deep red states? Why are so many deeply conservative states among the worst performers on a range of statistics, from output and income, to educational attainment, to life expectancy and literacy? Who really ought to be explaining their policy failures?

Now, it's obviously the case that this isn't all a matter of political preferences. Legacies of racial strife and inequality help explain both the politics and the economics of many southern states. Andrew Gelman will show you a thousand graphs demonstrating that a lot of economic inequality in a state leads to a more aggressive conservatism among the state's economic elite.

But that doesn't harm Avent's point: Viewed in the aggregate, states that vote Democratic have much better economies than states that vote Republican. If you look at the 25 states with the highest average incomes, exactly four of them voted for John McCain. So it's not exactly clear to me which red states are offering a model anyone would want to emulate.

By Ezra Klein  |  August 3, 2009; 4:56 PM ET
Categories:  Economic Policy  
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Comments

Ezra, you say "Viewed in the aggregate, states that vote Democratic have much better economies than states that vote Republican."

But viewing things in the aggregate here is misleading and you should know better.

For instance, state-by-state income INEQUALITY is at least as important as gross state product. And those numbers are much more of a mixed bag. Both Red states (Arizona, Texas, Kentucky, Tennessee, Arkansas) and blue states (New York, New Jersey, Florida, California, North Carolina, Pennsylvania, Massachusetts, Maryland) appear at the top of the list.

http://money.cnn.com/2006/01/25/news/economy/income_gap/#table

Posted by: fosterius | August 3, 2009 6:14 PM | Report abuse

The least unequal state is Wyoming and New York and New Jersey are only very slightly more equal than Texas.
High average incomes seem to correlate pretty strongly with a dominant financial services industry (New York, NJ, CT), or federal government (MD, VA). I'm not sure that's a great model to try to apply universally either.

Posted by: tl_houston | August 4, 2009 1:00 PM | Report abuse

Come on Ezra. You always cherry pick data. What about unemployment and state budgets. There you would have to concede that Blue states as a whole are much worse off than Red, though admittedly the data is complex.

Posted by: panza2mil | August 4, 2009 2:59 PM | Report abuse

Avent, states that enjoying higher population growth "that is largely explainable in terms of housing affordability and immigration...is not a good proxy for economic success" He and you do not realize that it is not a proxy but an indication of the right kind of economic success: egalitarian success.

I am of the age group that is migrating back to Texas. My peers went to all corners of the county for school and early career development but are returning to raise their children in Texas because Texas is livable.

Other people want to live in Texas because they are not allowed to participate in the elitist financial oligarchical(ponzi scheme)success or federal military industrial boom that the East coast enjoys.

Why do people want to live in Texas? Affordable housing (absent government spending!), quality of life, social mobility and opportunity, low tax burden, a government that has a balanced budget...and yes better education for our children. We spend less on government but end up with a better life. Those that are considered under the poverty line or lacking insurance are happy to be here and will be above the poverty line within a generation unless the feds get to them first.

Posted by: letmapeoplego | August 6, 2009 10:54 AM | Report abuse

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