pktechgirlbackup | If people are starving in Africa, they should move to France

Unemployment is high and this bad. But unemployment is not high everywhere. For example, it's only 3.3% in North Dakota, as opposed to Nevada, which has an unemployment rate of too serious for numbers. A 3.3% unemployment basically means all unemployment is frictional and anyone will get a job relatively quickly, so an easy solution is to move people from Nevada to North Dakota. Yes, the weather sucks, bu so does unemployment. The problem is, moving is expensive. Not necessarily super unbelievably expensive, but since it's the people with the least money that most need to move, this is potentially significant obstacle. It's also a drag on the economy: a 3.3% unemployment rate means jobs are going undone in ND. An excess of people in one area and an excess of jobs in another is an arbitrate opportunity waiting to happen.

How do we fix this? With money. I'm not the first to think of this:Modest Needs specifically has a category for relocation grants. I would really like this niche to be filled by private charity because I would like every niche to be filled by private charity, but this is like the least objectionable form of public assistance I can think of, and it's not being adequately served by private charity, so let's talk about it as a potential government program.

First, grant or loan? I can see arguments for either. This deserves its own post, but all of poverty research agrees on two things: you get the best outcomes if you just give money (as opposed to in-kind services), and people value things more and use them better if they have to work for them. So that would argue for a student loan type system, which should also make people think harder before moving, which is a good thing. On the other hand, it's not that much money, the infrastructure to collect is expensive* relative to the money earned, and it will screw people who get unlucky. On the third hand, you can't punish people who make bad choices (say, moved to a depressed area to be with a boyfriend) without punishing people who got unlucky. So I'm leaning loan, but if we wanted to entitle every American to a one time $5000 grant, I wouldn't fight it too hard.

Second, we need to consider what restrictions to put on the loan/grant. If it's a loan, my answer is "almost none." We could do something fancy like say "you must live in a county with >=n unemployment and be moving to a county with <=m", but why? n and m would not be updated in a timely manner, and things like having a social network can be more important than a percentage point of unemployment.

Nor would I put distance restrictions on them. Moving to get closer to a job you could technically commute to from your current place is a valid financial move, and generates some positive externalities. Ditto for moving from a low-initial cost high continuing cost location (i.e. long term motel) to a high-initial cost low continuing cost location (apartment with security deposit).

Once again, this won't solve everything, and it comes at some costs. As discussed in this comment thread, the poor and working class usually have deeper, more localized social networks, and breaking those up is a real cost, in both human and financial terms. On the other hand, nothing in the world is going to make Michigan better except pulling a Pittsburgh and shrinking to its new natural size. And government loans would make it easier for large chunks of a network to move together, relative to everyone scraping up the money themselves, or informal loans.

*alternately, it can end up being free money for banks, which I'm against. So I guess when I say "student loan type system" I mean "student loans like the kind in my head which are similar to but distinct from actual student loans