While the Republican Senators from the south stumble over each other to denounce the auto bailout bill, I got to thinking why. The obvious reason is that they are trying to bust the UAW and protect their local, foreign owned manufacturers. But, what bothers me about their position is they don’t seem to care that America effectively subsidizes their states, and that subsidization allows them to give tax breaks to the very same companies they are now protecting. In short, we already do for the foreign owned car manufacturers in these southern states what we need to be doing for these manufacturers in the north. Let me explain:
In 2005, for every tax dollar received from taxpayers in Alabama $1.66 was spent in Alabama; $1.51 in Kentucky; and $1.39 in South Carolina. That’s an income transfer. Money from primarily north and eastern states, California and Texas was transferred to southern and western states. The money spent in these states was used for all kinds of things and, because of the multiplier effect of money, created additional tax revenue in these states that afforded them the chance to give foreign owned car manufacturers tax breaks. In short, they were able to forego tax revenues, in part, because their state received Federal money greater than what was paid in.
I see the two Senators from Alabama and I’d love to ask them whether they even realize that the rest us subsidize their state. What would happen if we took back the extra sixty cents Alabama gets for every Federal dollar they collected? Would they be so quick to give tax breaks to companies? Would they be so quick to waste their time doing their manufacturers bidding to the detriment of the rest of the country? I doubt it.
Let’s face it. The only way to fight these jokers is to address the inequity of the distribution of Federal money. Year in and year out we have sucked the eastern and the northern states of money and dumped them into the south and west. And what have they done in return? When bad times visited the northern, American manufacturing companies they turned their backs. They turned their backs on Americans. They effectively said "screw you, I don’t care". I say start distributing Federal money in more equitable ways and perhaps you will get few southern Senators to understand that we are all in this together and that the days of the Federal Government turning their backs on their citizens is over.