Monday, February 20, 2012

Liberals subsidize the economic fallacies of red state conservatives

It has been well known for some time that liberal states such as my home state of Massachusetts subsidize conservative states such as my original home of Tennessee. The idea bubbled up recently from Aaron Carroll to Paul Krugman to Matthew Yglesias. Krugman explains the graph best, but this point of Yglesias's is key (though badly written):

[H]igh-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.
Hard to understand why he didn't say Godfather's Pizza instead of Taco Bell.

Conservatives imagine themselves as heroes in Ayn Rand's fantasy novels, and liberal aid to the poor is one reason they are not confronted with the sheer vanity of their imaginations.

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