Republican led states take federal money, then the politicians from those states spend most of their time denouncing the federal government. Yet, it is actually more complicated than that, even, because historically the northeastern and far western, coastal states have helped to support the needs of the poor in the south and elsewhere, while providing massive assistance from the 1930’s and ‘40s onward for the development of states like Texas**, which then elect to leadership positions people like Gov. Perry who denounce the federal government as some kind of evil conspiracy against “freedom” and Texas. What a deal.

Why do the politicians from the historically industrialized states allow those from the formerly rural, agricultural states to get away with the charade? Why do they send money to help the poor in states that prefer to ignore the poor? Why do they vote for billions of dollars in farm subsidies while cutting the food stamp program at the same time?

If one looks back over the last 8o to 100 years, the answer very likely is that compromises were made between the richer states and the poorer ones that helped everyone move forward and kept a kind of controlled peace between the states. That peace has ended now, however, with politicians from the so called red states repeatedly threatening to shutdown the federal government and even damage America’s financial standing in the world if they don’t get their way. Still, the             cross- subsidization goes on. The agricultural support bill, recently passed by Congress, is considered a “bipartisan measure”.

Looked at another way, this bargain can be seen as the eastern and far western states keeping their end of the deal, with no promise from the southern and southwestern states to honor anything the other states want or need. “We’ll do our part, you work against us as hard as you can.” Meanwhile, as the article at the right makes clear, billions of federal tax dollars flow into states like South Carolina to keep them afloat.

Without the federal money that South Carolina receives, the state would sink like a ship with ten thousand holes in its hull. Many of the old south, previously all rural states get a lot more money back than they pay out while states like New Jersey send more out than they see in return.

Here’s the essence of the political nature of this problem: the richer states don’t have a good weapon with which to threaten the others. If someone threatens to underfund the so called social safety net, what do you do, threaten to take away the safety net from them? Throw agriculture into a mess by cutting off the subsides quickly? Stop sending money in for highway expansion and maintenance? They can threaten the industrialized states, but those states don’t have a good threat in return.

The newer Republican crowd in Congress, mainly inspired by the tea party eruptions, are engaging in a kind of blackmail. (Of course, they’ve backed off the more public threats for the moment, but the game continues behind the scenes or with lesser known legislation.) Blackmailing them in return doesn’t seem like a winnable option. The question still remains: why should the northeastern and far western states support those in the middle who consistently vote against what the eastern/western states need and want?  Why is this bad bargain allowed to go on and fester? This is an open, upfront “conspiracy” against the interests of the so called blue states. The Speaker of the House, John Boehner, won’t even allow a vote on the floor of the House for any bill he does approve or that is not supported by a majority of Republicans, effectively closing down legislation and cutting off compromise before it can even get started. Meanwhile, Boehner is attacked by members of his own party for repeatedly suggesting a mild level of realism, saying that Republicans cannot get their way when they only control one house of Congress.

Things are badly out of balance in our political system. The rejectionist, nihilist factions have taken virtual control of the Republican party and they want more power every day. They are playing for broke, so angry and upset that Obama is in the White House that they gladly risk their future as a political party by going “all in” when they have won a majority vote for president only once in the last six presidential elections.

Sooner or later, the traditional bargain between the blue and the red states is likely to come flying apart. Sooner or later, the red state politicians are going to have to decide if they want to still be part of the American system or whether they truly want to test out the idea that they can do everything themselves with no help, no “interference” from outsiders.

Doug Terry, 3.3.14

FROM CHARLESTON CURRENTS:

The politics of taking and refusing federal money in a poor state
By ANDY BRACK
Editor and publisher

FEB. 24, 2014 -- The eagerness that the Haley Administration showed in seeking federal disaster assistance during this month's Great Ice Storm makes one wonder whether there is any sense to what kind of federal money is OK to take and what isn't.

You'll recall that as hundreds of thousands of people lost power and sat in dark homes growing ever colder, Gov. Nikki Haley rightfully said South Carolina was in a state of emergency and requested the federal government to officially designate it as an emergency. The move, approved the same day by President Obama, opened the state for lots of federal assistance -- generators, bottled water, meals and more. Who would  pay? The feds would pay 75 percent and the state would make up the rest. In other words, it was a three-to-one match to speed assistance.

So if you're keeping score, it's fine to take money that helps everyone get over a bad storm.
 

What about the $2 billion in stimulus money that the state eventually received to help plug shortfalls during the Great Recession? Although then Gov. Mark Sanford railed and steamed about why the state should refuse the money, the General Assembly, facing millions in shortfalls, grudgingly took the money.

Then-state Rep. Nikki Haley voted for the money at first, but opposed it on final passage.
 

So despite a lot of political wrangling, the state took the money, which allowed South Carolina to not fire teachers, state troopers and prison guards, among many other things.
 

Score: Take the money, 2. Don't take the money, 0.
 

Some other issues:
 

• Unemployment bailout. Also during the recession, the state accepted nearly $1 billion in federal loans to bail out its unemployment insurance coffers, which ran dry because legislators earlier changed a formula to keep rates low for employers. 
  
   
• Port deepening in Charleston. The state has put aside millions, but it will match even more millions expected from the feds. 
  
   
• Highway bills. The state Department of Transportation in 2011 had to turn to the feds to ask for advance payments to pay some bills it couldn't.
   

Score: Take the money, 5. Don't take the money, 0.
 

In fact, if you look at the state's total budget, South Carolina accepts about $2 billion more in federal money each year than it does through its own tax structure. Here are some of the big ticket items the feds paid for -- and we accepted -- in the 2012 fiscal year:
 

• Medicaid assistance: $2.9 billion.
   
• Food stamps: $1.7 billion
   
• Road grants: $776 million
   
• Hospital subsidies for caring for poor: $326 million
   
• School services for handicapped: $273 million
   

Bottom line: As a state, we receive more than $7.7 billion a year in money from federal sources -- money that we paid in federal taxes that comes back to help us here.
 

But what won't we take money for? Medicaid expansion and an education grant. 
 

Last year, the legislature, prodded by Haley, refused to accept $11 billion over seven years to expand Medicaid to pay for health insurance for the poorest of South Carolinians. Not only was it money we already pay into federal coffers that would have been returning to the Palmetto State, but it would have been free for a couple of years and required a $1 match for every $9 received in the long run (much better than the 3:1 deal for disaster recovery.)
 

In 2011, state Superintendent of Education Mick Zais also refused to apply for $143 million in new federal funding available to pay for more teachers. So what happened? Our share went to other states.
 

Is there a rhyme or reason to what we'll take and what we'll fight? This seems to be the formula:
 

• If it is something we've taken for a long time, we'll take it.
  
   
• Or if it is something that helps a broad range of people, including the rich and middle class, we'll take it.
  
   
• But if it's something new that helps poor people, such as Obamacare or more teachers pushed by a president that many in the General Assembly don't like, we won't take it.
   

Overall answer: It's all politics.  Who would have figured?

Andy Brack is editor and publisher of Charleston Currents and Statehouse Report. He can be reached at: publisher@charlestoncurrents.com.

Emphasis added by The TerryReport

http://www.charlestoncurrents.com/index.htm

**It is fairly safe to assert that without the federal government, there wouldn’t be a modern state of Texas. First, rural electrification in the 1930s, ‘40s and ‘50s. Interstate highways. Cash aid to agriculture.  The “oil depletion allowance” tax break for the oil industry. The Johnson Space Center in Houston. Military bases north, east, west and south. Land grant colleges. The building of the great railroads and, later, airports. The list goes on.

The ending of slavery by the Civil War was kind of an important marker, too. Without this “intrusion”, which many Texans still resent, Texas could not have begun its long, slow march into the modern world. It is impossible to imagine a world where the southern states would have still be holding slaves after 1900. The Civil Rights movement of the 1960s, which did not play out much at all in Texas, helped to free the entire old south, including Texas, from the restraints of discrimination and a society built on reenforcing it. In short, in addition to creating a measure of social and economic equality for blacks,  civil rights freed the white population from the necessity of acting out discrimination through social, commercial and electoral means.  Of course, it is entirely possible to get something good and beneficial that you said you didn’t want and then resent the gift that has been presented. The human mind is a wonderful thing, bending and twisting to create the world as we want to believe it is or should be.

It is these historically nurtured resentments and grudges that form the basis for the “Texas mind set” to this day and woe be it to anyone who thinks they might be able to change the outlook of anyone else. Gradually, ever so slowly, things evolve and, perhaps, old resentments fall off like barnacles off a ship’s hull, one or two at a time. 

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