David R. Henderson  

John Thacker on Democrats Subsidizing Rural Areas

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Sometimes comments on various blogs are so good that they deserve to be highlighted. John Thacker, who occasionally comments on this blog, has such a comment at co-blogger Scott Sumner's other blog, The Money Illusion.

In a comment on Scott's post ""Where Taxes Matter and Where they Don't," one commenter had stated (not that it was that relevant to Scott's post):

Remarkably enough, rural America is heavily subsidized by urban America. This fact becomes obvious if one ever looks at net federal spending and taxes by zip code or state.

Almost all rural infrastructure is subsidized, from railroads to highways to telephone and Internet service to airline service to water projects to electricity projects. And that's just the start.

That's not the great comment. The great comment is John Thacker's reply to this commenter. John wrote:
This is true, but the even more remarkable fact is that Democrats are still much more likely to support those rural subsidies, whereas Republicans oppose. Here's a vote on an amendment to limit Essential Air Service. It was a vote to table the amendment, so voting "No" meant wanting to limit Essential Air Service; almost Republicans except for the moderate Mainers voted against airline service subsidies for rural areas. Here's a vote on the sugar program, 60% of Republicans wanted to get rid of it, 60% of Democrats wanted to keep it. Votes on Amtrak to rural areas, the FCC subsidy to rural phone companies and Internet access, etc., it's all the same.

While there's some difference, especially among areas particularly effected, in general the rural subsidies stay alive because of the votes of urban Democrats.

What this demonstrates, which co-blogger Bryan Caplan has written about, is that the special-interest theory of political outcomes is not as strong as public-choice economists might think, and that ideology plays an important role on both sides. In short, on domestic policy at least, George Wallace was wrong. There is more than a dime's worth of difference between Republicans and Democrats.

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COMMENTS (4 to date)
Scott Sumner writes:

Thanks for doing this post, I was almost going to do the same.

David R. Henderson writes:

You’re welcome, Scott. And thanks to you for not being upset that I took material from your other site. Thacker’s great, isn’t he?

Levi Russell writes:

Here's a fantastic piece by Matt Palumbo that provides a different challenge to the first comment:


John Thacker writes:

Thank you very much for all the praise. Ideology plays a role, though horse-trading and compromise to form political coalitions certainly plays a role a well. Political coalitions can be strong enough to support votes even on isolated amendments to avoid wrecking a bill. Horse-trading is related to special-interest theory somewhat, but ideology certainly modulates which coalitions can form.

It's possible that in the future some realignment will cause this to be no longer true.However, certainly at the moment the vulgar assumption that rural subsidies survive because of the party that mostly represents the rural areas is untrue. Rural Republicans largely support these programs (though not as much as rural Democrats), but suburban Republicans strongly oppose, and it's urban Democrats that provide the votes to continue them. Holding special interest or benefit from the program constant, Republicans oppose the subsidies more. (This is particularly obvious from looking at Senate votes like this one from the previous session, as many states have one Republican and one Democrat.)

Special-interest theory is probably correct that it's easier to imagine urban areas electing people against rural subsidies than rural areas doing so.

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