Saturday, January 14, 2012

Why do Blue states have poorer economy?

Blue states often have poor economies due to a number of reasons. Many Blue states are also home to large urban centers, of which most are in decline. These ubran centers support a large amount of people on welfare programs, which puts considerable strain on government resources. With such large portions of their populations recieving government aid, this means that they are also more likely to be unemployed. This usually develops into a situation where there are more people riding the wagon than their are pulling it, so people are less likely to start new businesses in these areas, because they will face higher tax rates to support the mes who are supported by the system. Red states usually prefer less governmental intervention in most areas, therefore keeping taxes a lot lower. A small government costs less to run. Businesses are attracted to these low tax, small government environments for obvious reasons. This creates a chain of growth that leads to economic success. The more businesses there are, the more people have jobs. The businesses are able to pay higher wages due the low taxes, which in turn gives the labor population more money to spend supporting business. It can also be noticed that Red states also tend to have a budget surplus rather than a deficit.

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