Maybe, but I’m talking about incentives imposed by federal policy on the states, not incentives imposed by federal policy on federal policy.

Full deductibility means the sign of the net benefit of State policy doesn't change due to federal tax policy, no deductibility, or the actual current policy of limited deductibility, loses that effect; this is undesirable if you take a bottom-up federal view preferring local control of policy in general, the way Republicans like to pretend, it's arguably desirable if you prefer a top-down feudal order where the states are more firmly subordinated, the way Republicans tend to like to accuse Democrats of doing.

> If people can deduct all their state taxes, then the federal government will get less from some states than others due to state policies, not simply due to income differences

Which is a lot more meaningful if you think state policies have no impact on economic outcomes.

Once you acknowledge that they can, you have to acknowledge that any policy which limits deductibility necessarily disincentivizes some set of state policies that increase aggregate income of state taxpayers after state taxes, and thereby increase both federal revenue and (given federal marginal tax rates <100%) state taxpayer’s income after all taxes.

> So if we determine that the federal government doesn't want to get less money, wouldn't they be likely to attempt to meddle in state policy to prevent this kind of tax imbalance?

They can't be more likely to than they would be with limited/no deductibility, because they are 100% likely to meddle with limited/no deductibility, because both of those are forms of meddling.

To your first point, yes, I agree, minus the partisanship - I am not a Republican, nor am I a Democrat, but that said the aggressiveness of your response made me much more likely to just take the opposite position, regardless of the merit of your points - that's one of the reasons I waited.

Beyond your first point -

first, you imply that State policies necessarily have a POSITIVE effect on economic outcomes - I think you'd probably agree with me that while some state policies do, it doesn't apply to all state policies.

Second, while I acknowledge the ability of state policies to have an impact on economic performance, I do not HAVE to acknowledge that this effect is positive. Let's assume that it is, for the moment, though; from there, I logically agree with your premise, given of course that there were no alternative policies (federal, or individual) that would result in better returns.

Finally, to your last point - this doesn't actually make sense to me. Are you saying that because federal governments give a deduction of some kind, this means that they 100% involve themselves in state policy?

I agree, if you have a 1/0 idea of involvement. But if you take a more nuanced view (which I recommend) and understand that there is a gradient of involvement, your statement has no real value - could you clarify or expand it?

[by the way - I know you comment and work here a lot and assume based on your writing that you're an intelligent person - I have been drinking so please forgive me, but do you recognize that the way you write invites immediate aggressive responses and is needlessly complex? For example: "Full deductibility means the sign of the net benefit of State policy doesn't change due to federal tax policy" - this doesn't actually mean anything. I feel like you must know this but I have to be sure. I hope this isn't offensive.]