Wisconsin Forecasted to Lag Further Behind Minnesota: Live from Kaldi's Coffee CCCXXV: September 8, 2014
Menzie Chinn: Wisconsin Forecasted to Lag Further Behind Minnesota, and Kansas travels its own path...
...Bruce Bartlett brings my attention to this article noting Minnesota’s economic performance. This reminded me to check on the Philadelphia Fed’s forecast.... The cumulative growth gap between Minnesota and Wisconsin (relative to 2011M01) is forecasted to grow--rather than shrink--over the past six months.... The cumulative growth gap between Kansas and the Nation is also forecasted to rise, from the current gap of 2.7%, to 3.2%, in just the next six months...
The blue states have shot themselves in the foot with respect to overall economic growth--although not with respect to growth in per-capita income, and definitely not with respect to growth in per-capita wealth--via excessive NIMBYism. (And, I would argue, via blowback from Republican state-level tax-limitation initiatives like Proposition 13 and Proposition 2 1/2: with development population growth make the lives of state and local government officials harder and not easier, you greatly diminish the political voices for American pro-development boosterism. Blame Howard Jarvis for the fact that people from Texas cannot afford to move to the better-paying jobs waiting for them in California.)
Now the red states are shooting themselves in the foot definitely with respect to growth in per-capita income, definitely definitely with respect to growth in per-capita wealth, and now--perhaps--respect to the pace of overall economic growth as well. It will be interesting to see how much of a drag this "We don't need no infrastructure/We don't need no Medicaid expansion/No common core in the classroom/Biologists! Leave them kids alone!" red-state political equilibrium exerts on the regional distribution of economic activity over the next decade. Will it be enough to offset the Hispanic population influx and the continued transition to the full air-conditioning equilibrium?