I agree that state-level economic (or economic-geography) modeling in an integrated national economy is tough. But differences can be subtle and are almost always at the margins, and state-level policies have their effects at the margins. It’s more like a joint variable than an independent one but there is nonetheless some identifiable effect.

Regardless, a lot of domestic migration modeling has already been done. We needn’t remake the wheel. The biggest predictors are identified (e.g. climate). I’ve yet to see state tax regime listed among them.

There are two perspectives that make this clear:

1) Cities within the same state (same constraints) demonstrate significant variance in economic performance.

2) Rust Belt cities, regardless of state (variance of constraints) exhibit the same pattern of economic struggles.

State policy is a poor predictor of urban performance. Just look at how people vote with their feet.
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Some variances within a state can be explained by historic and developmental forces outside of state-level policy (especially historic concentrations of industrial specialization). Compare Warsaw, IN with Elkhart: the difference is that one specializes in RVs and the other in biomedical implants.

Further, similar “patterns” of economic struggles can have varying “frequencies” and “amplitudes”: compare Indianapolis and Lansing. Lansing got pounded much worse by GM’s failure, and that’s arguably an artifact of one state’s policy embedding lots of bias toward the US legacy auto manufacturers.

The reason I shrug off the possibility of a privileged 1/6 of the population keeping the rest down is that it’s only been observed in one modern country, Apartheid South Africa. And in several respects, US whites just don’t have that power. First, South Africa instituted apartheid while it was still a colonial state. And second, blacks in South Africa were poor; blacks are poor in the US as well, but as long as the racists can’t find it in them to appeal to educated immigrants, they’re fighting a losing game.

It is becoming a passing notion, just like it became a passing notion temporarily in the 1920s. But like in the 1920s, the in-group is a declining majority. By 2050, the US is expected to have a nonwhite majority, which means that today’s nativists will have to redefine Americanness to include most new immigrant groups.

Your optimism is unflappable, I’ll give you that.

I am skeptical that demography will solve the American political crisis.

I see the view that America is in a beautiful twilight. After the twilight comes the dark age.

The “Real Americans” have crystallized the who and what of membership requirements. History also tells us that, across time and space, these movements tend to thrive in crises.

Demographics may dilute their numbers but not their power. Whites could become 1/6 of the total population, but the point is moot if each one carries a revolver.

Other warning signs:
1. The proportion of crisis areas (rural and urban areas in decline) has grown in tandem with growth areas.
2. The United States has evolved socially and economically, but not politically. Despite our social and economic transformation, the governing structure is still stuck in the 18th century. This system magnifies the political power of crisis areas at the power of vigorous industrial areas. This in turn amplifies the power of crisis areas. Attainment of power confers validity.
3. This particular movement has underpinnings of a group mythology rooted in violent romanticism and possessing social dominance orientation. The latter is a common trait in nations with a strong timocratic social order — in both militaristic and propertied senses of the word.
4. This particular movement is measurably regressing in intellectual and social development. What Americans are erroneously calling an ideological backlash is actually one that is tribal.
5. We also must deal with the problem of a group that feels it has fallen from its origins. Godwin’s Law forbids me from mentioning a particular political party or its ideology to make a point, but there are other movements with similar grievances: irredentism, revanchism, theocracy and even its more extreme extension of thearchy. A need to recapture a common glory is a dangerous thing.

What has happened to these movements? The horrors of 20th century Europe were highly intense but of short duration. On the other hand, the Middle East threw a Tea Party in the 15th century that continues through this very day.

Should we be forced to choose between these two fates?

This is no different from how in the 1960s and 70s the Republican Party redefined itself to appeal to non-Jewish ethnic whites. In the 1920s and 30s, the racist demagogues hated Italians and Poles, and often Catholics in general. In the 1970s, they hated only Jews and blacks. A declining majority can be uncanny in making sure it remains a majority.

The US does benefit from its choice to define Americanness in non-ethnic terms (and so does Canada).

I grow worried that this is becoming a passing notion, especially after the Iraq war started, continues today, and is growing worse as the downturn prolongs.

We’ve heard many demagogues make in no uncertain terms what Americanness “really” is. It was made clear in its group identity and its belief system, which at its heart features a mythos of violence and social dominance orientation.

It’s cold comfort to say that Americanness is not unique in time or space, or “just a phase that will pass”, because it usually passes in a bad way.

I’m not sure how much I buy the weak social welfare hypothesis. The US does have entrenched unemployment among the inner-city poor. Even in 2000, Harlem had 20% unemployment; inner-city Baltimore had 40% unemployment. Underclass unemployment in the US isn’t much better than in France. Where the US does better is that its minorities are more likely not to be in the underclass to begin with.

Besides, Israel has social welfare, but most recent immigrants, who are Jewish, do not slip into welfare dependency; the group that does suffer from high welfare dependency is ultra-Orthodox Jews who’ve been in the country almost since independence. While Israel is more racist than the US and Canada, it’s not so racist against Jewish immigrants (unless they’re Ethiopian, and the Ethiopian-Israeli community does have high unemployment).