Here’s a thought. Democratic policies are good for coastal cities while Republican policies are good for the South. And the two should not project their economic policies onto the other. Federalism is the best way to compromise between the two factions. I don’t view America as a single nation so there cannot be a single one-size-fits-all policy

Red States, especially the South, are in economically booming. There is a massive wave of domestic emigration to the South and their economies are growing at a much faster rate. Republican policies focus on rapid growth by lowering taxes and regulations. These regions are more socially homogenous so they can focus on the economy. In other words, Republican policies work very well in the red states but are less useful for the blue states.

Likewise, Democratic fiscal policies and welfare programs are best applied to immigration clusters. These may not be the wisest economic policies. High-taxes with welfare slow economic growth and chase out the Middle Class. But there are significant social benefits. These welfare programs ease the transition of foreigners into the United States. The Democrats act as the “bridge” party to America. Once the immigrants assimilate and enter the middle class… they become Republicans and move south.

The US is a “high-trust” country. Property rights are formally recognized, capital is fungible, contracts are respected and enforced, and the police don’t take bribes. Native born Americans take this for granted and don’t understand how immigrants are shocked by sudden immersion into our way of business. It’s not just a language gap. Immigrants come from different legal and economic systems.

Most immigrants are from “low-trust” countries.  Their home countries that have large informal economies, where property rights are not official and finances are not secure.  Corruption is rampant and the only way to start a business is through bribery. Politicians in low-trust countries are often demagogues and ideologists rather than boring policy-wonks. Some don’t even come from democratic countries.

When these immigrants arrive in America, they tend to cluster together in the big coastal cities.  These clusters (Little Italy, Little China etc) share a common culture and language. They get a taste of America’s high-trust economy, but lack the skills needed to work in a new legal and economic environment. Even English-speaking immigrants are on unfamiliar ground, so they stick together in their little national communities.

Assimulation is a gradual process. Usually second or third generation immigrants are assimulated. The minimum requirement is speaking the native language for utilitarian purposes and respecting the native laws and customs. The jump from a low-trust to high-trust society is a difficult one.

Democrats have eased this transition for the past two centuries. In places like New York City in the 19th century, the Democrats virtually became the Irish Party. It aided future waves of immigrants, Italians, Russians, Jews, and today Mexicans. Democratic policies favored various welfare programs for job creation, redistribution of wealth, free public education and the like. The Democratic Party deals with concentrated foreign populations that are in difficult situations so they prioritized social benefits over economic ones.

The thing is, Democratic policies are counterproductive when urban policies are applied to the entire nation. The problems facing coastal cities are not the same problems facing the South. For instance, economic equality is rising rapidly in New York City and other major Democratic strongholds. Many Democrats noticed that the Middle Class “disappeared.” They Middle Class actually grew richer across the country, but inside the Democratic cities, they middle class left, the upper class stayed, while new foreign (and poor) immigrants arrived. This created the inequality gap the Democrats are noticing. The Middle Class basically went to the South, and today the South is relatively more egalitarian than urban cities. On gun control, the Democrats face high levels of urban crime and realize, perhaps correctly, that unassimulated foreigners shouldn’t be entitled to firearms. But this does not mean rural and suburban Americans should be disarmed.

The problem is that both parties are projecting their primary regional interests onto the entire USA. Their limited local experiences are not universal. I’m all for debate over the priority of national interests but we’re not seeing that at all. Instead, each party puts its own region first and does its best to vindictively screw over the other half.

Advertisements