Sunday, February 13, 2011

Socialism Texas Style

The west Texas town of Miles, population 800, taxes its citizens to the tune of $710,000 per year to pay for local schools.  The rest of Texas chips in another $2.5 million(1) to make sure the children of Miles have a decent education. Despite the socialism of this system, the Socialist Party of America doesn't do well in local elections.

This vignette plays out throughout rural and small town America.  There, staunch conservatives live in a bubble - viable only because of socialist taxes on city-based people and corporations. The state and federal money going into rural/small-town America is always greater than their taxes paid(2).  Indeed, the modern infrastructure of rural small town life would not exist but for water projects of the Bureau of Reclamation, the electrical grid subsidized by the Rural Electrification Administration, and the interstate highways of the Transportation Department.  All these socialist policies provide transfer of wealth and services from cities to rural communities. Without socialism, we would be talking about ghost-town rather than small-town America.

What would happen if we dropped the socialist support for small-town schools?  Towns would have to substantially raise local taxes or reduce the quality of education - making them less attractive to new businesses, residents and young families.  In a true free market, the local businesses, farms and ranches would have to pay higher wages to attract workers to live in a higher tax/poor-education town. Rural businesses, farms and ranches paying higher wages couldn't compete in a global marketplace. Many towns simply wouldn't survive. Indeed, the transfer of wealth from cities to rural America is simply an indirect subsidy of rural landholders and businesses, keeping their costs artificially low and their businesses competitive.

Personally, I do not mind the socialist transfer of my wealth for rural America's infrastructure and education. There are good social and economic reasons for maintaining a vibrant rural community. I do, however, resent the attitude among the rural elite who pretend they are more self-sufficient and morally superior to those who are actually picking up a good bit of the tab for their community.


(1) Data from Austin-American Statesman article "Budget cuts menace rural schools and communities" by Kate Alexander, February 13, 2011.

(2) The notable exceptions are rural areas with mineral/oil/gas extraction industries, where upfront royalties are generally greater than ongoing infrastructure costs. However, such royalties rarely cover the long-term environmental clean-up costs (which again are usually covered by taxpayers or corporations in cities).

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