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But Dennis, study this interactive map from the United States Conference of Catholic Bishops. Roll over South Dakota, and you'll find that, of the surrounding states, we are tied with Montana for the highest poverty rate in the region. The numbers:
- Overall Poverty: 13.6% (tied with Montana for 17th highest in the nation)
- Child Poverty: 16.8% (27th nationally; regionally, only Montana kids are worse off: 17.3%, 24th in US)
- Senior Poverty: 12.5% (9th nationally; worst in region)
Montana has a steep income tax and no sales tax, making its tax system among the most progressive in the nation.
ReplyDeleteWyoming has lower taxes than either South Dakota or Montana -- and its poverty rates are close to the nation's lowest.
Interesting: I wonder which way the causality arrow points. Does low income/high poverty move Montana to seek a more progressive system to ease the burden on those low-income folks, or does the progressive system reduce incomes and drive folks into poverty? Or is there no causal relationship?
ReplyDeleteWyoming: I can envision a curve where lowering taxes increases income and keeps people out of poverty... but is that a linear relationship, or does the curve bend back? Would there come a point where lowering taxes does more harm than good to GDP/income?
Montana offers quality of life opportunities that make paying taxes far more palatable. There are lots of good reasons for young people willing to make sacrifices to live where recreation abounds.
ReplyDeleteOn any one day there is more money in circulation in Gallatin County than in all of western South Dakota. except possibly during the Rally.
After looking at several states on the above-mentioned map and comparing what I know of their tax rates/structures with their poverty levels, I can't see a significant correlation between the two.
ReplyDeleteSo in answer to your question, Cory, I'm not convinced that we have any "causality arrow" to talk about, at least in this simplistic model.
However, it seems reasonable to suppose that some factors or combination of factors must cause poverty or, conversely, reduce it. Larry's explanation makes some sense to me. But -- is it true, or not?
Someone must have undertaken a study in an unbiased attempt, a truly open-minded attempt, to find out what causes poverty or prosperity in various states. What's really at the root of all this? Can we even break things down meaningfully along state borders?
South Dakota's higher poverty rates might be attributed to having the largest percent of Native American population of any state in the region. Third World poverty rates among Native Americans hurts the state's standing in these sort of statistics.
ReplyDeleteNative poverty is a long standing problem and anyone who can develop a way to lift the native population out of poverty deserves the Nobel Prize in Economics.