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> blue states are subsidizing the red states. Two things should be kept in mind when discussing this topic, The US, a large economically diverse nation with a
by dmm 8y ago
> blue states are subsidizing the red states.
Two things should be kept in mind when discussing this topic,
The US, a large economically diverse nation with a single currency, only works because of fiscal transfers. Even the economists who engineered the Eurozone knew this, they just hoped a single currency would bring greater unity that would eventually lead to fiscal transfers.
The analysis that come to this conclusion all include social security and medicare. I think that's pretty misleading. A big group of my friends all attended public schools and universities in a red/purple midwestern state and after graduation all moved to the coasts. The coastal states get educated workers and leave behind retiring parents.
- SamReidHughes 8y agoTechnically, the US worked just fine, before there were fiscal transfers. What's really the case here is that a social safety net in the presence of migration can't be done on a state by state basis. It has to be national, which invariably results in net flows between states. A lot of measures of interstate transfers mistakenly treat federal spending as a transfer. Really it's trade. A small percentage could be counted as a transfer.