Just for clarity, I feel it's important to point out that the surplus/deficit figures quoted here compare 20 years of Federal taxation and spending against just one year of GDP. In other words, for the majority of the red states in the bottom half of the table, net Federal spending represents less than 2.5% of the state's economy.
Also, these figures entirely neglect so-called "unfunded mandates", Federal programs that compel the states to spend their own money on various programs.
Medicaid is one well-known example of this kind of spending. Nationwide, Medicaid amounts to about 2% of GDP.
Presumably, states that secede would discontinue spending related to unfunded mandates. Eliminating Medicaid alone could largely offset the loss of Federal spending in many red states were they to leave the Union. Eliminating all obligations under unfunded mandates could put most of these states back into the black overall.
There are also Federal requirements that amount to unfunded mandates on individuals and businesses, such as the need to spend substantial amounts of money each year on bookkeeping for Federal taxes, OSHA and ADA compliance, and so on.
Finally, we should not simply assume that all Federal spending is beneficial. Much of it goes toward purposes that don't help the states in meaningful ways, such as maintaining large offices full of workers who would be freed up to do more valuable labor in the absence of a Federal presence.
It's my opinion that there are no more than one or two red states that could not easily support themselves if the substantial overhead costs of Federal government were removed. Given a full understanding of the consequences, these states might not choose to secede.
Although I think it's highly unlikely that any states will seek to leave the Union, I believe it's most likely that such a thing would happen first with one or two states. Other states would wait to see how these experiments worked out before following their lead.
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timeasmymeasure
no subject
Date: 2012-11-10 07:39 am (UTC)Also, these figures entirely neglect so-called "unfunded mandates", Federal programs that compel the states to spend their own money on various programs.
Medicaid is one well-known example of this kind of spending. Nationwide, Medicaid amounts to about 2% of GDP.
Presumably, states that secede would discontinue spending related to unfunded mandates. Eliminating Medicaid alone could largely offset the loss of Federal spending in many red states were they to leave the Union. Eliminating all obligations under unfunded mandates could put most of these states back into the black overall.
There are also Federal requirements that amount to unfunded mandates on individuals and businesses, such as the need to spend substantial amounts of money each year on bookkeeping for Federal taxes, OSHA and ADA compliance, and so on.
Finally, we should not simply assume that all Federal spending is beneficial. Much of it goes toward purposes that don't help the states in meaningful ways, such as maintaining large offices full of workers who would be freed up to do more valuable labor in the absence of a Federal presence.
It's my opinion that there are no more than one or two red states that could not easily support themselves if the substantial overhead costs of Federal government were removed. Given a full understanding of the consequences, these states might not choose to secede.
Although I think it's highly unlikely that any states will seek to leave the Union, I believe it's most likely that such a thing would happen first with one or two states. Other states would wait to see how these experiments worked out before following their lead.
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