3 ms·
Other comments have good points, but the main thing IMO is that tax receipts are low in the midwest / south is that what they produce (food) is incredibly cheap
by bpodgursky 10y ago
Other comments have good points, but the main thing IMO is that tax receipts are low in the midwest / south is that what they produce (food) is incredibly cheap now days.
The US produces a ridiculous surplus of food with a tiny portion of the population because we're incredibly good at doing it cheaply. High volume and low cost == low prices == low tax revenue. It doesn't mean low real-world value or produced value.
You could "fix" it by trying to balance revenues by playing with tax rates, but all you'll accomplish is making food expensive in CA/NY, shifting dollars around, and making everything more complicated than it is now.
There are plenty of other reasons tax revenue registers in NY/CA; anyone -- from anywhere in the country -- with a retirement account is funneling it through some NY mutual fund, and entertainment is still mostly produced in CA. If NY didn't exist, it would be managed somewhere else; it's not that NY is producing magical value nobody else understands. It's just most convenient.
If Hollywood stopped producing movies... we'd all be a bit more bored temporarily, but it's again going to get bought from somewhere else.
- vacri 10y agoHollywood = $30B. California's economy = $2.2T. California agriculture = $40B, bigger than any other state's, and bigger than Hollywood.
- talmand 10y agoShall we compare what California grows as compared to what any Southern state grows?
- dalore 10y agoYou realise food is cheap because of taxes/subsidies. If we had to pay the true cost of food it would be expensive. And the politician that did wouldn't be liked much as well.
- jws 10y agoTotal USDA agricultural subsidies amount to $0.10/capita/day. It adds up to a large number, but it doesn't move food from expensive to cheap.
- thowfaraway 10y agoCan you show the calculation where subsidies to food are greater than the cost of regulation of food? Sugar is particularly regulated, with the government strict quotas and tariffs on imports, and domestic allotments to produces. If you produce more than your allotment, it is illegal to sell in the US. The whole scheme is to hold prices high to support famers (agribusiness really), not low.
- dalore 10y agoSugar is regulated and the price is kept high for farmers. But not for the consumers which is my point. Farmers are given subsidies in all crops so they can sell them in the global market at below market rates, not only for the population, but to compete with out countries doing the same thing.
- thowfaraway 10y agoTax receipts are low in the midwest / south also because tax rates are low. This study rewards California and NY for having extremely high state taxes - it doesn't reflect actual federal dependency.