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Go Home Romney’s Most Radical Proposal

PLANK OCTOBER 18, 2012

Romney’s Most Radical Proposal

Mitt Romney and Paul Ryan want to give the states a lot more control over the size and shape of the social welfare state. How would states with different political profiles react? And what would it mean for the people who live in those places? In an article from The New Republic’s print edition, I try to answer those questions by figuring out how two groups of states—the red and the blue—use the flexibility they already have. But doing so turns out to be a lot trickier than you might imagine.

Consider the two states that feature prominently in my article, Massachusetts and Texas. Upon immediate inspection, the safety net in Texas certainly looks a lot weaker than the safety net in Massachusetts. Fewer people in Texans are eligible for most of the major safety net programs. And the assistance the Texans programs provide tends to be more meager.

But what exactly do those figures tell us? Texas has more poor people, after all. It’s also a less expensive place to live. How do we adjust for that? And is what true in Texas and Massachusetts true in the rest of red and blue America? Many of us have assumed so. Ed Kilgore wrote about this phenomenon for the Washington Monthly a few months ago, calling it the “Mississippi model.” But do the statistics back up that description?

To get some perspective, I turned to Marcia Meyers of the University of Washington and Sarah Bruch of the University of Iowa. For more than a decade, they’ve been studying variation in government safety net programs across the states. They’ve found that one of the best way to capture the differences is to look simultaneously at the inclusiveness—that is, the share of those in need who are assisted—and generosity—that is, what level of benefits people receive. With the data set they’ve constructed, they can break down the level of support and the likelihood of receiving support by specific public program. They can look, for example, at Temporary Aid for Needy Families (TANF), which is the program for cash assistance or welfare, or subsidies for childcare. They can also adjust for cost of living differences across states, to reflect the fact that food and housing in New York costs more than it does Louisiana. "To understand how safety net provisions are experienced by families, it is critical to examine not only the average benefit received,” Bruch says, “but also the likelihood of receipt across multiple programs."

At the request of TNR, Meyers and Bruch compared red states to blue states, using results of the last three presidential elections as a rough proxy for political leanings. We asked them to define red states as those that voted for the Republican candidate all three times—in other words, Bush, Bush, McCain. We ahd them define the blue states as ones that voted Gore, Kerry, Obama. We told them to disregard states that didn’t vote the same way in all three contests, effectively taking “purple” states out of the comparison. They also excluded Alaska, Hawaii, and Wyoming because the data in those three is so atypical, due to factors unique to those states. (Alaska, for example, has a guaranteed minimum income, financed by payments from the state’s huge oil extractions.)

Meyers and Bruch examined the proportion of the needy population states were serving in each program by calculating the number of people receiving services and comparing that to the number in need—for example, the number of families receiving TANF compared to the number of poor families; and the number of individuals receiving unemployment insurance relative to the number of officially unemployed. For TANF, unemployment insurance, child-care subsidies, and health insurance, the blue states were more inclusive—enrolling a larger proportion of the population in need. 

To measure “generosity,” Meyers and Bruch calculated the average benefit received by participants in each program and adjusted for state cost-of-living differences. The results were virtually identical. Blues states were more generous with TANF, unemployment insurance, and child care subsidies. Only when it came to the Supplemental Nutrition Assistance Program, or SNAP, are the red states relatively more generous—and that, Meyers pointed out, is because the federal formula for SNAP deliberately offsets the effect of other assistance programs. “The US does not have a single safety net for the poor,” Meyers said. “It has fifty different safety nets and the political leanings of the state are a good predictor of how much ‘safety’ these programs provide.”

Meyers and Bruch caution that their calculation cannot fully capture how supportive states may be of their needy residents. But their results are consistent with the data that’s available elsewhere. In April, Curtis Skinner, director of family economic security at the National Center for Child Poverty, wrote a report called “Protecting the Safety Net in Tough Times.” As part of his research, he compiled a state-by-state tally of “safety net spending”—a category that included major, means-tested programs like Medicaid and TANF, as well as smaller programs for foster care, homeless shelters, and so on. Then he compared what each state spent, as a percentage of its budget, to the national average—and adjusted it all for the poverty rate in each state. The results were striking. The ten “highest expenditure” states were all blue states and eight of the ten “lowest expenditure states” were red. “It’s an imperfect measure,” Skinner says, “but it gives you a sense of which states prioritize their safety nets.” 

Does this mean, definitively, that red states care less about their neediest residents? No, in part because that’s also a question of philosophy and policy efficacy—something I plan to take up, separately, in the next few days. But here's something to remember: The whole point of federal programs like SNAP and the Affordable Care Act is to establish a national standard for the safety net—to make sure all Americans have some level of economic security, regardless of where they live. Handing the former over to the states and repealing the latter would undermine that national standard, allowing the disparities that exist today to become even bigger.

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7 comments

Twenty years ago I had direct experience of such state-to-state differences in service provision. I had worked in Alaska for four months on a commercial fishing boat that was registered in Washington state.  I was not paid a wage but rather a percentage of the net proceeds of the boat and for tax purposes was treated as an independent contractor and required to play self-employment tax out of which FICA was taken. Both of my fellow deckhands were residents of Washington state, and they informed me that in Washington unemployment benefits were made available to seasonal fisherman when season came to an end.  When the season was finished I returned home to Virginia and went into the unemployment office to apply for my benefits with the understanding that all states have reciprocal agreements with regard to unemployment insurance claims such that if I lose my job in Washington I'm eligible to move to Virginia and still receive benefits.  In Virginia, however, the self-employed, including fisherman, are not covered, and they gave me the big kiss off. I suppose I could've gotten a lawyer, but it didn't seem worth it at the time. 

- AaronW

October 18, 2012 at 2:45am

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I would be interested in knowing the relative tax rates of the states in the sense that a welfare expenditure difference between two states with identical revenues might be judged differently than a poorer state and wealthier state evaluated as a percentage of their budgets.

- Nusholtz

October 18, 2012 at 7:31am

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I had a relative who worked in social services in two big red states: Louisiana and Texas. As I understood her job, a lot of the work consisted of begging supplies from corporations, especially drug companies, to help support the needy. I think she was being paid by the state, but much of the help offered was what she was able to get outside of the state budget. Do these studies take this into account and is it different in blue states? I live in a blue state and there is a very active charity network here that always is asking for help, but red state apologists are always saying that charity fills in what the state help lacks.

- polijunky

October 18, 2012 at 9:40am

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If Romney gets his way, the safety net will become more like a safety rag. Giant holes in it that let millions fall through.

- polcereal

October 18, 2012 at 11:13am

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If the net transfer of federal tax revenue flows from the "blue" states to the "red" states, shouldn't the "blue" states have a say about how those funds are used? If we really are going down the block grant path, then lets make sure that the money either comes with strings attached or that the states that prefer "limited government" aren't being subsidized by the states that see more of a role for government programs.

- bMorHon

October 18, 2012 at 12:19pm

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Speaking of the safety rag, a close relative lives in a state with a rag. People suffer because of it, don't get help they need because there's so little available. Meanwhile that wonderful ER, where we're supposed to go for medical care, is very costly and they demand serious money for relatively simple fixes. People need to think what this all means in real human terms. It means people going without, period. I find that unacceptable in Exceptional America. And, it takes away whatever pretense people may have had to independence and self-control. That's why Romney has told his friends to advise their workers how to vote. Scared people with no resources are sitting ducks.

- Sophia

October 18, 2012 at 1:28pm

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Red states and blue states may not change identities over time. States that distribute funds to their residents as they see fit will undoubtedly continue those policies and practices that are already in place.

- Doug12

October 18, 2012 at 4:04pm

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