Why Red states will NEVER secede from the Union

[omahas]

There's been a lot of noise from a small but vocal community of libertarian and tea-party Republicans who believe that, especially after Obama was successfully re-elected, secession is the only resort left. I find this amusing in light of the evidence...but then, maybe that evidence hasn't been put in a simple enough context for them.

So, I decided to do that.

I've created a table that lists out all of the states (sorry, no territories or DC), which candidate that they voted for, and whether they have a surplus or deficit as of 2009 (as a percentage of the 2009 GDP). My sources are here (The Red and the Black, Politico: 2012 Presidential Election). I've simplified some of the surplus/deficit numbers...I didn't to strain anyone's limited math skills.

Reviewing the chart, it is quite clear what will happen. If all states that voted for Mitt Romney were to secede from the union successfully, here is the result:

17 Blue states would be available in the "Obama Union" to help fund the 9 Blue states that have a deficit of >0%

4 Red states would be available in the "Romney Union" to help fund the 20 Red states that have a deficit of >0%

Those 4 Red states...Arkansas, Georgia, Texas, and Nebraska...are probably, as a whole, not all that interested in actually seceding. Talking about it is as far as they will go. I mean, why would you want to help fund that many people, when you believe in pulling yourself up by your own bootstraps?

Chart:

Comments

[ideaphile.livejournal.com]

Your post relied on an analysis of the effect of Federal taxation and spending on the individual states in order to support your argument about the red states collectively, so it's important that the underlying analysis is correct.

Clearly, during the recession, the Federal government has played a dramatically larger role in the economy than it previously did. Since all Federal participation is inefficient-- the costs of managing this participation are substantial, so the benefits are always smaller than the costs-- inevitably the states have lost more money during this time, which increases the incentive to secede.

I don't think you mean that the recession "would just shift everyone down the chart equally". The chart is just an ordered list. But if you mean that the recession, or the resulting increase in Federal spending, has impoverished everyone equally, then I would generally agree, except that "equally" is not right. Some states have been more sensitive than others to the economic disruptions that caused the recession.

Just for the record, I referred to Medicaid, not Medicare. The difference is significant, because Medicaid is a state-managed medical assistance program for the poor of all ages, not a Federally managed insurance program for the elderly. Also, it doesn't help the discussion to insult me, even conditionally. Let's keep this about the facts, not ourselves.

There was a time before Medicaid, so it is not impossible that some red states might simply abolish it, which would likely force those who rely on Medicaid to move to the blue states, thus improving the fiscal health of the red states. Clearly the opportunity to end this kind of state-funded public assistance creates another incentive to secede.

Unfortunately, it's difficult to obtain data that show what portion of state budgets goes toward complying with Federally mandated bookkeeping. I can point to this spreadsheet for the state of Washington:

http://www.dop.wa.gov/WorkforceDataAndPlanning/WorkforceDataTrends/Documents/WorkforceHeadcountByAgencyandCounty.xls

It shows that the state agencies that deal with social and health spending are by far the largest, and it's reasonable to suppose that overhead from Federal rules compliance is relatively highest for these agencies, but I admit these data are not exactly conclusive.

There are some good estimates of the costs of Federally mandated bookkeeping on the private sector, however, and it seems likely that the overhead for the states is at least somewhat similar.

According to the Laffer Center:

http://www.laffercenter.com/wp-content/uploads/2011/06/2011-Laffer-TaxCodeComplexity.pdf

"U.S. taxpayers pay $431.1 billion annually, or 30 percent of total income taxes collected, just to comply with and administer the U.S. income tax system."

The greatest part of this cost is in lost productivity:

"TheTaxpayer Advocacy Service of the IRS estimates that individuals and businesses also spent 6.1 billion hours complying with the filing requirements of the U.S. income tax code. We estimate the dollar value or cost of these hours to be $377.9 billion as of 2008."

Note that the estimated number of hours comes from the IRS itself; the dollar estimate is from the Laffer Center.

I think it is likely that individuals and businesses are relatively more efficient at complying with Federal bookkeeping requirements than state bureaucracies. All in all, Federal overhead is easily several percent of GDP for the country as a whole and for the individual states.

(continued)

[ideaphile.livejournal.com]

(continued from my previous message)

You are correct that the states would have to begin direct spending to cover various necessary functions that are currently managed by the Federal government. But this is not a useful observation, since the states (and the citizens and businesses within the states) already pay for these functions indirectly-- the functions themselves, and the administration of them.

To be useful, you would need to estimate whether the red states would bear a less than or greater than proportional share of these costs relative to the nation as it exists today and relative to a hypothetical union of red states.

A casual review of the red states identified in your post seems to suggest that they are more likely to be inland states that would be able to get by with much lower military spending. Some, especially Alaska, likely could not afford to become militarily self-sufficient, which could dissuade them from seceding-- or other seceding states could agree to subsidize Alaska's military spending.

You said "Obviously the Federal government will not allow the seceding state to keep the Feds weapons and other military items" but this is not obvious at all; indeed, the statement contradicts historical evidence from the dissolution of the Soviet Union.

Fundamentally, it wouldn't be practical for the US Federal government to insist that peacefully seceding states return the conventional weapons located in those states. The Federal government would have no place to put them, no people to maintain them, and no people to use them. These were the same arguments that led Russia to allow the other former Soviet republics to keep essentially all of their military equipment. This was true of even the smaller republics, which could not have resisted Russian demands to return their equipment.

The same arguments applied to nuclear weapons as well-- some former Soviet republics (Belarus, Kazakhstan, and Ukraine) retained their nuclear weapons when the Soviet Union broke up. They were relinquished to Russia over time, but these were voluntary political decisions.

So I think the facts show, pretty clearly, that the vast majority of red states could be self-sufficient. This shows that a union of red states is not inherently unlikely due to the need for successful states to subsidize poor states.

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