JM: You needn’t look any further than the homelessness problem in many liberal areas of the country for an example. Santa Cruz, near where I live, is a magnet for the homeless due to a nice climate and a super-liberal politicat situation. In many ways it makes Berkeley look conservative. Yet SC has been clamping down harshly on homeless camps in recent years.
Trying to extract from this an actual answer to my question, I come up with something along these lines:
“The solution to the free-rider problem under these hypothesized circumstances is that blue states would end up abandoning their minimum standard of decency for social services, at least as applied to red-state immigrants. Poor red-staters would lose the incentive to migrate and would remain as a burden on the red states rather than siphoning resources from blue states.”
Fine. To which I reply: I think the social divisiveness and suffering this would entail would have a very negative impact on both types of states, and on the country as a whole. Largely-immiserated red states next to socially-responsible blue states sounds like a recipe for social unrest and economic inefficiency. If this is what neofederalism will produce, I’m against it.
Now you get to argue (if you want) your reasons for thinking that neofederalism wouldn’t produce largely-immiserated red states (in contrast to some of the liberal neofederalists here who seem to be supporting the idea mostly because they think it would). But I think they’ll need to be something more concrete than the usual blithe libertarian optimism about how the unfettered free market makes everybody rich and generous.
Leonard: *More government services and the higher taxes to support them would attract people and repel business. Low government services and lower tax rates would attract business and repel people. *
This sounds like only half the story, though. Don’t lower taxes also attract people? And don’t higher services also attract businesses?
Leonard: * If there were large differences, people would move. However, this movement is what will force the states to find an equilibrium. If the differences are great enough to cause a mass movement of people, then it will also cause a mass movement of business in the opposite direction. Red and blue states would have to bring their taxation/services closer to the same level.*
This is the same problem I’ve had with many other libertarian scenarios: the most probable outcome seems to be that we go through an awful lot of social, political, and economic disruption to wind up with a compromise that’s pretty close to what we’ve already got. I’ve never yet seen a convincing explanation of why we should bother.