Will States Compete to Care for the Poor?

More

Federalism can stoke healthy competition for residents. But there's a perverse incentive to repel the poorest ones.

ryanbudget.banner.reuters.jpg

Reuters

In Reihan Salam's latest column, he offers a useful sketch of what separates Rep. Paul Ryan and President Obama on Medicare reform -- among other things, the president puts more faith in the ability of federal appointees to bring down costs -- and goes on to contrast their takes on the rest of the budget. "If Ryan is essentially matching the White House on how much he intends to spend on Medicare over the long term, how does he constrain the growth of federal spending more than the president?" Salam asks. "According to Obama, he does this by starving programs for the poor, like Medicaid and food stamps, and subsidies for higher education, among other things."

He goes on:

One view of the Ryan approach is that state governments and voluntary organizations will pick up the slack for meeting the needs of the non-elderly poor. State governments that do a good job of crafting cost-effective solutions will, over time, beat out state governments that don't, as households and firms migrate over time to those jurisdictions that offer the best services at the lowest cost. Moreover, the most successful state policies will presumably spread, just as the best management practices tend to spread across competing firms in a given industry.

Is that true?

Tech.Biz.Medicine.Ideas.
See full coverage

When it comes to job creation or building good transportation infrastructure or maintaining a clean environment or establishing a regulatory environment where affordable housing thrives, I have no trouble believing that successful state governments attract residents and that their practices tend to be noticed and mimicked elsewhere.

But caring for the non-elderly poor seems as if it might be different. If a state designs a program that poor people regard as especially beneficial to their interests, wouldn't a lot more poor people move to that jurisdiction? Isn't there a perverse incentive to adopt programs that repel rather than attract the non-elderly poor, who can be a drain on public resources when present in sufficient numbers and are everywhere objects of prejudice no matter how small their population?

This happens at the local level in Southern California municipalities with which I'm familiar. At the state level, it has been a problem in the past: During the Great Depression, as impoverished migrants made their way to California, the Los Angeles Police Department set up checkpoints on the border with Arizona and forbade fellow American citizens from entering the state! We're unlikely to witness a spectacle like that again, but less direct methods of keeping poor migrants away from a state seems like at least a theoretical problem for national policymakers to anticipate.

Also problematic is a federally run program for the poor that attempts one-size-fits-all programs to help populations as diverse as Hmong refugees in central California, laid-off auto workers in the Rust Belt, and Louisiana shrimp-boat captains suffering after Deepwater Horizon. Constitutional questions aside, I have no idea whether state governments or the federal government would ultimately prove to be the best option for bettering the lot of the poor. But I'd feel better about going the state route if that incentive problem were somehow addressed.

Jump to comments
Presented by

Conor Friedersdorf is a staff writer at The Atlantic, where he focuses on politics and national affairs. He lives in Venice, California, and is the founding editor of The Best of Journalism, a newsletter devoted to exceptional nonfiction.

Get Today's Top Stories in Your Inbox (preview)

A Delightful, Pixar-Inspired Cartoon About the Toys in Your Cereal Box

The story of an action figure and his reluctant sidekick, who trek across a kitchen in search of treasure.


Elsewhere on the web

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register. blog comments powered by Disqus

Video

Juice Cleanses: The Worst Diet

A doctor tries the ever-popular Master Cleanse. Sort of.

Video

Why Did I Study Physics?

Using hand-drawn cartoons to explain an academic passion

Video

What If Emoji Lived Among Us?

A whimsical ad imagines what life would be like if emoji were real.

Video

Living Alone on a Sailboat

"If you think I'm a dirtbag, then you don't understand the lifestyle."

Feature

The Future of Iced Coffee

Are artisan businesses like Blue Bottle doomed to fail when they go mainstream?

Writers

Up
Down

More in Politics

Just In