We Do Provide Lots of Aid To Rural Areas

One long-standing problem Democrats face is that many people have a very different definition of what constitutes government assistance:

Veterans benefits aren’t government aid (41%!?!)? How is that possible? One argument is that these programs are invisible:

Mettler argues that any real reform that involves these hidden non-state actors must begin with explicitly making the invisible visible to the eyes of the public. It takes time and effort to bring the machinery of the submerged state up into the light of day, but it’s necessary — and effective. Obama’s effort to restore direct federal funding of student loans was a good example of this. The banks were making billions each year off this program, at the expense of millions of students who should have been getting that money instead. He was able to pull this off because activists and journalists had already spent several years hauling the ugly wreck of a policy up into public view, which weakened the ability of banking lobbyists to defend their position. By the time Obama arrived, they were weak enough that he could demand — and get — a complete end to this lucrative subsidy.

I think this is overthinking the problem. This seems a case of willful ignorance by definition. Government aid is for lazy slackers, for ‘welfare queens’, and, in some people’s minds, for those people. Decent, hard-working people don’t receive government aid, even when they do. In other words, any program that helps middle-class people, people like themselves, is, by definition, not aid, because government aid is inherently pejorative.

Regardless, Democrats do need to emphasize, when in rural areas, that their policies are better than Republicans. That said, there’s another problem:

There is a view emerging in the wake of Donald Trump’s election that we need a rethink on how to help struggling rural communities that may have driven Trump’s surprise victory….

More concisely, Adam Ozimek defines the view in opposition to the idea that we need to help “people and not places.” Something must be done about struggling rural communities. Understandably we don’t know what that something is yet. All we know is that it can’t look like the traditional welfare state, because the welfare state robs people of their dignity. As Noah Smith points out, “people care a lot about community, respect, family, and other non-market goods that Bernie-ism [here a stand-in for redistribution] may not address.” Instead, the argument goes, we need to reinvigorate regional economies that will provide people with the dignity and social goods that come from a thriving community.

This strategy of helping communities and not individuals is bad politics. It is not new – the survival of many declining post-industrial and rural communities depends on a massive network of implicit and explicit subsidies. If anything, this strategy has entrenched resentment of minorities and the feeling of abandonment that lead to Trump’s rise. We already go far out of our way to normalize and legitimize the kinds of support that rural communities receive, while conventional direct assistance is incredibly visible. By burying these programs in the tax code and propping up Truman Show communities, we make them invisible to the people they support.

This dynamic of two welfare states – an invisible system for the white working class and a scarlet letter, bread line, FOOD STAMPS ACCEPTED system for urban minorities – leads to the perception among working class whites that the government does nothing for them while handing everything to minorities and immigrants.

And this is the end result:

Local tax incentives aren’t the only way we subsidize declining rural areas. HRSA has current aggregate awards worth $1.3 billion for rural health workforce development – literally compensating physicians to set up practices in rural areas through loan deferral and repayment. Another $279 million is awarded for rural health centers. The $11.9 billion DSH pool (Disproportionate Share Hospital) is critical for standing up rural hospitals where many are uninsured or rely on Medicaid and Medicare (whose payments don’t cover costs).

There are other examples that could be developed – the 30 year fixed mortgage and interest deductions are huge giveaways that disproportionately benefit rural areas. ICE TEA and our whole appropriations process for transport spending puts big burdens on cities that rural and suburban areas don’t face, biasing how funds are allocated.

Note that none of these programs are direct assistance – we spend billions to support places, not people. And precisely no one in these communities is aware of the storm drain of federal cash propping up their personal Potekmin village. Instead the invisible welfare state, designed to flatter their dignity and sensitivities, entrenches disillusion with what they believe (at best) is an unresponsive government. At worst, the government is very responsive – to an undeserving other, and never to “real” Americans.

As I’ve noted at a larger scale, the traditionally conservative parts of the U.S. receive a massive federal Keynesian stimulus at the expense of more liberal places (which often suffer from contractionary policy). This reality needs to be made more clearly, not to shame people, but increase solidarity.

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7 Responses to We Do Provide Lots of Aid To Rural Areas

  1. The starting argument (para 1) that utilization of one of the labyrinthine paths of avoiding confiscatory, compelled taxation (e.g. 529’s, home mortgage interest deductions, kiddie credits) is tantamount to “use of a government social program” rings a little circular to me. Indeed, in Table 3 of the referenced original article, 5 of the top 6 “government social programs” claimed to have been used at high rates are, instead, means of avoiding the payment of taxes, i.e. the forced taking of your stuff by the government to use as they see fit if we state it more plainly.

    The 6th in that gaggle – student loan programs – is a government-implemented subsidy to the higher education industry (seen the climbing walls, spas, and student centers of late?) and the banks (been to the Hamptons & Westchester lately)? Having a few degrees, and employing a few degree-holding people, I think the real market value of the outcome of this 6th is for debate, but that’s another thread.

    Further, I am not sure of the thrust of the Veteran’s Benefits argument in the cited article, but I don’t completely agree that Vet benefits are reasonably construed as “government social programs” any more than a policeman’s or cow-college professor’s pensions are. They are, instead, more like contractual obligations (reasonable, market based or not) that follow to the recipient predicated on a service provided to the public under contract. I cannot address or defend the asymmetry of the values of benefits to those services, but I suspect that you will agree that the lifelong bennies to a military vet – who volunteered to work for the military – is qualitatively apples to oranges vis a vis a poor welfare recipients section 8, EBT, heating subsidies etc. All without moral judgement to persons individually.

    That all said, morally we have to ask the question if the failing here is the lack of articulation re: the magnanimity of the government redistribution schemes, or whether it is that such forced redistribution and social intervention policies exist at all. Having spent much of my life in rural/farm communities and demes, I suspect that the individualist bumpkins will ask the latter, while the more urbanized intelligentsia wring their hands over the former. Ideological divergence between the the more self-sufficient individualists in outback versus the more collectivist sensibilities of the urbane, well, urbanites are not new. These will persist long after we are gone. Only the moral question is important: Is forced redistribution defensible at all?

    • Ken Barker says:

      “Only the moral question is important: Is forced redistribution defensible at all?”

    • the more self-sufficient individualists

      You mean the delusional people who think they’re self-sufficient while there’s a net flow of tax money from urban to rural areas?

      • If one takes corporate-welfare recipient farmers out of the mix, then look at the assertions in the OP versus your own comment: If the poor people in my rural area need a “net flow of tax money” from the urban wealthy, then this would reinforce my position that tax-incentives (termed “government social programs”) listed in the OP are of no relevance to them anyway and, therefore, these folks do not utilize “social programs”. That is, poor people pay no taxes regardless of where they live. Are you by chance conflating living in a rural geography with simply being in dollar-poor demographic?

  2. Chris G says:

    > As Noah Smith points out, “people care a lot about community, respect, family, and other non-market goods that Bernie-ism [here a stand-in for redistribution] may not address.”

    Smith believes that Bernie-ism does not address those things?! Pardon me, “may not address”. That is ignorance of the highest order.

    This is not about community, respect, family and other non-market goods? http://billmoyers.com/2014/10/30/sanders-richmond-speech/

  3. Tom_b says:

    “Ideological divergence between the the more self-sufficient individualists in outback versus the more collectivist sensibilities of the urbane,”

    Farm subsidies. Sub-market rate grazing access on Federal Lands. Medicaid. The “outbackers” get theirs. And do not receive much succor from the GOP. How many rural hospitals are struggling? How many wind farms ( supplemental income streams for rural areas) are delayed or canceled because Republican suck at the fossil fuel teat?

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