Even though we all think of the recession as being worse in the sand states that went nuts on real estate during the boom, wholemsome midwest states are really suffering. After California, the biggest increase in new jobless claims this week were in Missouri, Kansas, Oklahoma and Iowa.
But Iowa may have found a way out of its economic ruin. Today Iowa’s state supreme court ruled that the state’s same-sex marriage ban violates the constitutional rights of gay and lesbian couples. This makes Iowa only the third state where gay marriage is legal. Countless studies have shown that legalized gay marriage is a boon to state budgets and economies, encouraging same-sex couples to visit and marry there.
Of course, this boom from same-sex marriage depends on the continued ban in nearby states. A nationwide ruling along the lines of the Iowa court decision would stem the state-specific same-sex marriage benefits. It’s an arbitrage opportunity that will quickly vanish if it becomes too popular. In short, same-sex marriage is a zero-sum game that can only deliver returns when it is isolated in a few progressive pockets. States like Vermont and Connecticut are already threatening to make Iowa’s same-sex marriage advantage vanish.