Atiba Pertilla writes,
I read your paper “Rich state, poor state, red state, blue state” with
a great deal of interest. I think it’s very important to cut through
facile generalizations about income levels and voting behavior.That said, I would like to know if you’ve ever thought of looking at
housing costs as one way of controlling for variation in economic
conditions from one part of the country to another. In other words, a
$60,000 salary can provide you a lot more house in Laramie, Wyoming
than it does in Marin County, California. I know that your argument is
in part about people’s perception of their income relative to those
richer and poorer than them, but it seems important to note that the
standard of living provided by a certain income is likely to vary
considerably from one part of the country to another regardless of how
people perceive their income relative to the folks in the next
subdivision over.Data that might help you investigate this possibility could be taken
from HUD’s studies of fair market rent conditions around the country.
My reply:
Yes, people have raised this issue, in particular when I spoke on the paper at the family policy seminar in the social work school here. I don’t think cost of living could explain things all by itself: the difficulty is that, if the cost of living is high in Calif. (and thus, people in the top income category aren’t so “rich”), then people in the lowest income category will be even worse off. So the cost of living, by itself, doesn’t change the relative difference between rich and poor. There’s a related argument, that the subjective difference between rich and poor is greater in Mississippi than in Connecticut, but this would require some differential effect.
Not entirely unrelated, but I thought at the time that you might have to control for household _wealth_, which could be approximated by using local housing data. Or a grad student with access to Zillow.com and a lot of time on his/her hands. :^)
Isn't it typical of overheated housing markets like the coasts that house prices have raced far ahead of rents? The rent-purchase ratio is one important measure of the valuation of the real estate market. So people who buy houses for investment purposes take losses on rent while hoping for future capital gains (and the market not to crash).
Given this, the poor may not be as relatively worse off in CA than they are in say, IL. The poor in CA may be renting at reasonable rates, while the "rich" are foolishly paying millions for buying property that may crash …
1. I don't think anything explains it all, by itself.
2. I know this will make you cringe (both by association and by expertise) but Steve Sailor has an interesting take on this.
3. I'm not sure EXACTLY how this comes into play, but I (who am pretty Repub/Libertarian) but pay all my taxes rigorously have noticed that some of my liberal friends will use every legal trick to avoid taxes and even (I think) in some cases do things that are not strictly honest. I don't think Bill Clinton's used underwear donated to charity had a $5/pair value, used underwear is a rag…also my very liberal (thought millionares should all have wealth confiscated) buddy in the service when it came to tax time had his uncle the accountant ship him all these manuals from the IRS…when the rest of us were doing the EZ form. There is also an interesting comment in The Bell Curve (I know this will make you cringe) that Byzantine complicated rules systems for taxes and business help the high IQ more as they can game them better, comply with them better. It ends up being a competition barriar. I don't want to sound too one-sided so will point out that my service buddy, did volunteer in Peace Corp. Similar to this is some of the writing on "moral free ridership". not sure where all this is going, but it intuitively feels relevant.
4. There are a lot of other interesting blue/red state things (rural, versus non-rural, military service, etc. etc.)