Let the Red States Secede
by Brett Arends
Monday, October 12, 2009provided by
Commentary: A separate but equal health-care solution
The biggest question about the new Schumer-Carper health-care plan on Capitol Hill is the one nobody's asking.
Why stop there?
In case you missed it, Sens. Chuck Schumer, D-New York, and Tom Carper, D.-Delaware, are considering a proposal that may, at long last, break the logjam over health-care reform.
They would create a public health insurer, the so-called "public option," but allow individual states to opt out if they wanted.
In other words: the blue states can have public health insurance, and the red states can go without.
You may wonder why it took so long to get here. If Blue America wants public health insurance and Red America doesn't, why should one of them end up denied? And this is not a new issue. Liberal commentator Paul Krugman, in his book, "The Conscience of a Liberal," argues that Harry Truman's plan for universal health insurance was blocked, in part, because Dixie didn't want integrated public hospitals.
The Schumer-Carper bill raises a terrific prospect. We could apply this principle all sorts of other areas of government activity, from taxes and spending to education.
If Blue and Red America want to pursue separate policies, why shouldn't they? The unspoken secret of American politics is that Blue America would be far better off, economically and otherwise, going it alone. Blue America has a huge amount to gain and almost nothing to lose from undoing Lincoln's Folly -- a.k.a. the Civil War, the War of Northern Aggression -- and leaving the South and other red states to their own devices.
Secession movements have sprung up in a variety of red states in recent months.
Contrary to conventional wisdom, maybe the thing about Barack Obama that offends the red states most is neither that he is black, nor that he is somehow socialist pink, but that he is very, very "blue" -- a liberal college professor with a foreign-sounding name and lots of overseas fans. According to one poll, nearly half of southerners question whether he can really be the legitimate president.
These secession movements are good news for Blue America. They should be encouraged. If Red America wants to be left alone -- and that increasingly seems to be the case -- then Blue America should not look this gift horse in the mouth.
Blue America has most of the money, and pays most of the bills already. Cutting out Red America will be a big win.
The best analysis on this matter comes from the Tax Foundation, a highly regarded Washington, D.C., think-tank that's been studying U.S. taxes and budgets since the 1930s. The foundation is non-partisan. Although, as an institution critical of taxes, it leans philosophically to the right.
Over the years it used to estimate how much the citizens of each state paid into the federal budget in taxes, and how much they received through federal spending. The net result showed which states were paying in more than they received, and vice versa. The foundation stopped publishing the research a couple of years ago, and the last analysis related to 2005.
However, the data are still instructive. The picture did not change much from year to year. In short: Blue America is paying in, and Red America is taking out.
Money Pit
Look at the numbers. New Jersey got back just 61 cents for every dollar it paid in federal taxes. Connecticut: 69 cents. Illinois: 75 cents. New York: 79 cents. Massachusetts: 82 cents. In other words, being a member of the union is costing these states billions in lost money.
Meanwhile Mississippi gets back $2 in federal spending for every dollar it pays in federal taxes. Alaska: $1.84. Louisiana: $1.78. North Dakota gets $1.68, Alabama $1.66, Tennessee $1.27, Idaho $1.21 and Arizona $1.19.
Red staters always like to accuse blue states of high taxes. But if they are right, one of the principal reasons blue staters are paying higher taxes is to subsidize...red staters.
Blue America paid these extra taxes because, on the whole, they have higher incomes, so they pay higher federal income taxes. (Note: The Tax Foundation analysis normalized the budget to assume no deficit, assuming, reasonably, that the future taxes to pay for the deficits would come from same people paying the current taxes.)
If you compare the states that went for John Kerry in 2004 with the states that voted for George Bush, a clear pattern emerges. Based on Tax Foundation numbers, Blue America paid somewhere in the vicinity of $800 per person in extra taxes to support Red America. No kidding: $800 for every man, woman and child.
That's quite a tax cut: $3,200 for every family of four.
And it doesn't end there.
Blue Economies in the Black
According to data compiled by the Commerce Department, the economies of the blue are actually growing faster than the red states too.
California, much derided in conservative circles as a high-cost, high-tax, moonbat/left wing hell, has nonetheless managed to grow its real output per person by 25% over the last 10 years.
How did its low-tax, low-cost, red state neighbors do over the same period? Arizona is up just 14% per person. Nevada: 10%. Utah: 10%.
Over the past 10 years, New York's real, inflation-adjusted output has boomed by 33% per person. Massachusetts: 25%. Oregon: 29% The figure for the red Midwest: 16%. The deep red southeast: 12%.
Ironically, the red states have done worse even though they have enjoyed a number of advantages: lower wages, lots of land, huge subsidies from the blue states, and even a massive, worldwide boom in commodity prices. Apparently it still hasn't helped.
The idea of Red and Blue America going their separate ways sounds too radical to gain political traction -- especially in such a conventional political climate as ours. And maybe it is.
But America is starting to resemble those other countries where two or more "nations" coexist unhappily within a single state -- like the English and the Scottish, the Spanish and the Catalans, or even the English-speaking Canadians and the Quebecois. In most cases, greater autonomy for the two halves usually has been found to make both sides happier.
Copyrighted, MarketWatch. All rights reserved. Republication or redistribution of MarketWatch content is expressly prohibited without the prior written consent of MarketWatch. MarketWatch shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.
by Brett Arends
Monday, October 12, 2009provided by
Commentary: A separate but equal health-care solution
The biggest question about the new Schumer-Carper health-care plan on Capitol Hill is the one nobody's asking.
Why stop there?
In case you missed it, Sens. Chuck Schumer, D-New York, and Tom Carper, D.-Delaware, are considering a proposal that may, at long last, break the logjam over health-care reform.
They would create a public health insurer, the so-called "public option," but allow individual states to opt out if they wanted.
In other words: the blue states can have public health insurance, and the red states can go without.
You may wonder why it took so long to get here. If Blue America wants public health insurance and Red America doesn't, why should one of them end up denied? And this is not a new issue. Liberal commentator Paul Krugman, in his book, "The Conscience of a Liberal," argues that Harry Truman's plan for universal health insurance was blocked, in part, because Dixie didn't want integrated public hospitals.
The Schumer-Carper bill raises a terrific prospect. We could apply this principle all sorts of other areas of government activity, from taxes and spending to education.
If Blue and Red America want to pursue separate policies, why shouldn't they? The unspoken secret of American politics is that Blue America would be far better off, economically and otherwise, going it alone. Blue America has a huge amount to gain and almost nothing to lose from undoing Lincoln's Folly -- a.k.a. the Civil War, the War of Northern Aggression -- and leaving the South and other red states to their own devices.
Secession movements have sprung up in a variety of red states in recent months.
Contrary to conventional wisdom, maybe the thing about Barack Obama that offends the red states most is neither that he is black, nor that he is somehow socialist pink, but that he is very, very "blue" -- a liberal college professor with a foreign-sounding name and lots of overseas fans. According to one poll, nearly half of southerners question whether he can really be the legitimate president.
These secession movements are good news for Blue America. They should be encouraged. If Red America wants to be left alone -- and that increasingly seems to be the case -- then Blue America should not look this gift horse in the mouth.
Blue America has most of the money, and pays most of the bills already. Cutting out Red America will be a big win.
The best analysis on this matter comes from the Tax Foundation, a highly regarded Washington, D.C., think-tank that's been studying U.S. taxes and budgets since the 1930s. The foundation is non-partisan. Although, as an institution critical of taxes, it leans philosophically to the right.
Over the years it used to estimate how much the citizens of each state paid into the federal budget in taxes, and how much they received through federal spending. The net result showed which states were paying in more than they received, and vice versa. The foundation stopped publishing the research a couple of years ago, and the last analysis related to 2005.
However, the data are still instructive. The picture did not change much from year to year. In short: Blue America is paying in, and Red America is taking out.
Money Pit
Look at the numbers. New Jersey got back just 61 cents for every dollar it paid in federal taxes. Connecticut: 69 cents. Illinois: 75 cents. New York: 79 cents. Massachusetts: 82 cents. In other words, being a member of the union is costing these states billions in lost money.
Meanwhile Mississippi gets back $2 in federal spending for every dollar it pays in federal taxes. Alaska: $1.84. Louisiana: $1.78. North Dakota gets $1.68, Alabama $1.66, Tennessee $1.27, Idaho $1.21 and Arizona $1.19.
Red staters always like to accuse blue states of high taxes. But if they are right, one of the principal reasons blue staters are paying higher taxes is to subsidize...red staters.
Blue America paid these extra taxes because, on the whole, they have higher incomes, so they pay higher federal income taxes. (Note: The Tax Foundation analysis normalized the budget to assume no deficit, assuming, reasonably, that the future taxes to pay for the deficits would come from same people paying the current taxes.)
If you compare the states that went for John Kerry in 2004 with the states that voted for George Bush, a clear pattern emerges. Based on Tax Foundation numbers, Blue America paid somewhere in the vicinity of $800 per person in extra taxes to support Red America. No kidding: $800 for every man, woman and child.
That's quite a tax cut: $3,200 for every family of four.
And it doesn't end there.
Blue Economies in the Black
According to data compiled by the Commerce Department, the economies of the blue are actually growing faster than the red states too.
California, much derided in conservative circles as a high-cost, high-tax, moonbat/left wing hell, has nonetheless managed to grow its real output per person by 25% over the last 10 years.
How did its low-tax, low-cost, red state neighbors do over the same period? Arizona is up just 14% per person. Nevada: 10%. Utah: 10%.
Over the past 10 years, New York's real, inflation-adjusted output has boomed by 33% per person. Massachusetts: 25%. Oregon: 29% The figure for the red Midwest: 16%. The deep red southeast: 12%.
Ironically, the red states have done worse even though they have enjoyed a number of advantages: lower wages, lots of land, huge subsidies from the blue states, and even a massive, worldwide boom in commodity prices. Apparently it still hasn't helped.
The idea of Red and Blue America going their separate ways sounds too radical to gain political traction -- especially in such a conventional political climate as ours. And maybe it is.
But America is starting to resemble those other countries where two or more "nations" coexist unhappily within a single state -- like the English and the Scottish, the Spanish and the Catalans, or even the English-speaking Canadians and the Quebecois. In most cases, greater autonomy for the two halves usually has been found to make both sides happier.
Copyrighted, MarketWatch. All rights reserved. Republication or redistribution of MarketWatch content is expressly prohibited without the prior written consent of MarketWatch. MarketWatch shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.
