This study explores how politics affects the propensity of the American states to pursue equity in local outcomes. Using state education finance as an object of analysis, we develop a theoretical model that emphasizes the social welfare implications of equity versus allocative efficiency and distributive politics. We then hypothesize that the relative liberalism of a state's citizens and institutions should affect both the weight attached to equity in the social welfare function and the ability of the courts to alter those weights. Using a panel design, we explain state funding allocations to 8,048 local school districts from 1992 through 1996. The statistical results show that the relative emphasis on equity differs substantially across states based on political values. States with conservative citizens and institutions place less emphasis on revenue equity than states with liberal citizens and institutions. Judicial mandates are generally unsuccessful in producing more equal allocations but are more successful when accompanied by receptive citizens and institutions. The larger implication is that responsiveness to political values is a major determinant of state propensity toward equalizing outcomes across local jurisdictions.