Christopher Kutz, UC-Berkeley School of Law
Building an alternative semi-national identity
The basic proposal is to form a Compact of Compacts: a set of western states, including California, Oregon and Washington, possibly Nevada, and for some purposes Hawai’I and Alaska, to engage in deeply-linked domestic policy initiatives and multi-state institutions and regulatory policies. If the idea were extended non-regionally, non-contiguous states could link in for a variety of initiatives, e.g., CO2 emissions.
The chief advantages over the alternative, of California going it alone, are that (a) there are substantial benefits to other states in linking to California (with perhaps some significant synergies for California); and (b) such a union presents a more coherent “shadow” alternative identity for the country as a whole.
As a symbolic matter, the Western Union can define and defend a vision of inclusive, science-based policies and institutions with massive democratic support – they can thus present both a concrete form of resistance and persistence, and project an alternative national identity for the United States.
Below are some areas where coordinated policy may be helpful or interesting. The key questions in each are, I think, articulating the benefits for each partner, and being able to make a case that the benefits of coordination exceed the transaction costs. (I assume that a variety of legal forms, including formal compacts, will be available, and choice of form will be a function of the transaction costs, or uncertainties about being able to sustain coordination.)
It seems to me that there are two sorts of arguments one needs to make for this effort. The first involves articulating the substantive areas of beneficial cooperation. I am eager to know whether this list should be longer or shorter, and how one might evaluate possibilities. The second sort of argument is symbolic, and will use work by historians, sociologists, and political scientists. It must address the question of how group identities can function to sustain redistributive demands, or other political strains – and what particular resources there are in American (or US-western) political culture to supply these identities. A first step is establishing a framework or matrix of shared public values. Again, I am eager for your thoughts on this matter.
(1) Environmental Policy:
Premise: while California alone is the biggest actor on the coast in relation to climate risks, there are substantial advantages to a multi-state initiative, including expanding the environmental consortium to include Canada, the Northeast, and other potential partners. Asian counterparts could also be found, especially if the coalition at the state level grows to include Northeast and Canadian regions.
Proposal:
(1) Emissions caps/reductions: Strengthen and reaffirm the Pacific Coast Collaboration, keying it to reduced effort on the national front, and revisiting the Western Climate Initiative. The initiative might come to include a region-wide carbon tax as well as a cap-and-trade component, especially in relation to foreign partners.
Questions: Do multi-state carbon taxes or cap-and-trade reduce race-to-the-bottom concerns with movable industry? Why did the WCI fail?
(2) Strengthen the collaboration for research innovation and smart grid investment. Carbon tax revenue could be pooled regionally for investment purposes.
(2) Immigration:
Premise: The western states all depend heavily on both authorized and unauthorized immigration for their labor forces, both skilled an unskilled. Further, all the western states have a generally tolerant and welcoming ethos in relation to immigration, finding it a force of strength.
Proposal:
(1) The Union can coordinate policies of federal non-cooperation, and can share the burden of defending those policies legally. The Washington-led litigation of the Executive Order shows some possible benefits of multi-state coordination, where the issue can be linked to labor, employment, and taxation. (Much will depend on whether the Supreme Court upholds the standing theory of the states.)
(2) Movement of unauthorized migrants can be facilitated through multi-state recognition of identity papers, and coordinated “Dream Act” policies in higher education and employment. Health care benefits (per (3) could also be extended through the region, which might help seasonal/agricultural labor.
(3) The potential financial burdens of forgoing federal money (as threatened) could be compensated through shared tax revenues.
(3) Health Care:
Premise: The Western Union states are ideologically favorable to universal health care policies, and significant numbers may be favorable to motion towards a single-payer plan/public option. In addition, while the California health exchanges seem to be relatively healthy, there have been serious problems of reduced choice in Oregon and perhaps Washington. The most serious problem facing the states will be the loss of ACA subsidies, and tax pooling (per 4) may be unable to compensate.
Proposal:
(1) A mini-Obamacare are consortium could be enacted, with flexibility on the mechanisms of establishing coverage and recruiting/retaining younger and healthier members, as with Romneycare. A single-payer network, sharing administrative burdens, could be built out, or a “public option” alternative to private plans.
(2) With a multi-state system, portability in the Western Union could be assured.
(3) Drug purchases for Medicaid/Medicare could be coordinated, enabling economies of scale (or at least allowing OR and WA to benefit from California economies).
(4) While most of the benefits would flow to those riding CA’s coattails, there might be administrative efficiencies that would allow some return to CA.
Questions: It appears that the ACA did a lot of redistribution to California, through its supplementary taxes and Medicaid expansion. What are the limits of surtaxing regional incomes for health care? Are the complications of establishing multi-state insurance plans and coverage requirements greater than the benefits of the single-state model? Will proposed legislation enabling cross-state sales support such policies?
(4) Fiscal policy
Premise: Federal expenditures and subsidies for policing, health and housing, and retirement may see large reductions, creating large burdens on state policy. Federal enforcement of labor conditions, civil rights, and environmental compliance may soon be reduced as well. Federal income tax rates may also be reduced.
Proposal:
(1) While the states may wish to retain different marginal tax rates, they may wish to coordinate a revised income tax policy keyed to reductions in federal income rates. States in the Union could increase income tax rates in proportion to federal reductions, in order to fund efforts that backfill from federal withdrawal.
Questions: Given the politics of tax increases, will attempts to coordinate increased marginal rates (even if the states retain different rates) founder at the state level?
(5) Labor policy:
Premise: The states of the Western Union have each experienced quickly widening gulfs between the highest and lowest paid workers in their economies, resulting in a set of shared concerns especially in relation to low-wage work and food and housing security. Moreover, the announced Labor Secretary nomination of Puzder suggests lack of federal effort to police standards involving low-wage workers.
Proposal:
(1) The states may want to coordinate living wage policies, especially since all share a sharp differentiation of living costs between urban/coastal and rural/inland regions.
(2) There may be benefits in coordinating enforcement of labor conditions with multistate employers, replacing federal efforts.
(6) Education
Premise: all three states would benefit from coordinating access to higher education among their student populations. Moreover educated young people are likely to move among the different coastal cities.
Proposal:
(1) The Union states could coordinate a mutual in-state tuition benefit, in exchange for cross-subsidization of enrolled Union students. (The EU Erasmus project is potentially a model.)
(2) The Union states could coordinate higher education financing, for example through a coordinated income-based repayment program.
Question: Would cross-state enrollment undermine or support political support of public education? Do the campuses and systems now have so much autonomy that coordinating a scholarship policy will be too difficult? Given the difficulties of coordinating just within the UC system, are gains likely?
(7) Retirement systems:
Premise: Private retirement systems (Vanguard, TIAA-CREF) are already multi-state, as are college savings programs. There would seem to be no reason not to pool state retirement systems and pensions.
Proposal: The Western Union creates a shared retirement system, or set of retirement options. Pooling would most benefit the smaller states, but there might be management benefits (or risk spreading) for California as well.
(8) Political reform:
Premise: All three states suffer from some of the common ailments associated with a referendum-friendly political system. At the same time, the tradition od progressive populism in all three states can support, for instance, redistricting commissions and other innovations that can reduce polarization and political gamesmanship.
Proposal: The union of states can explore questions of constitutional and electoral reform together, in a coordinated way, treating the whole space as one for political and structural experimentation. The states can also pool techniques for increasing voter turnout and enhancing public discussion of policy issues.
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