In the News

Demonstrating Paths to Freedom & Prosperity: Jonathan Williams on Prosperity 101

Our goal at ALEC and with Prosperity 101 is to get government out of the way so people and businesses can flourish.

What policies promote freedom and prosperity? How do we identify policies that will help individuals, businesses, and communities to thrive?

ALEC Executive Vice President of Policy and Chief Economist Jonathan Williams talked to host Linda Hansen of the Prosperity 101 podcast about the importance of free markets, limited government, and federalism in promoting economic growth and prosperity. They also discuss the Biden administration’s efforts to centralize power and undermine federalism, as well as the potential consequences of allowing 2017 Tax Cuts & Jobs Act to expire.

Listen to the full interview.

The Land of Make Believe

Williams refers to Washington, D.C. as the “land of make believe,” echoing Ronald Reagan’s sentiment that it is an “island surrounded by reality.” This term reflects the disconnect between the economic perspectives in Washington and the rest of America. According to Williams, Washington tends to consume and redistribute wealth, imposing bureaucracy and regulations, while organizations like ALEC advocate for free markets, limited government, and federalism. This divergence in economic thinking underscores the importance of getting government out of the way to allow people and businesses to flourish.

“Well, in the land of make believe, Reagan called it ‘an island surrounded by reality.’ So, I think it’s a good way to think about the way Washington thinks versus the reality that the rest of America feels. Washington doesn’t create, it will just redistribute and consume wealth, and put bureaucracy and regulations in people’s way. Instead, our goal at ALEC and with Prosperity 101 is to get government out of the way so people and businesses can flourish. There’s a disconnect between the way DC thinks about accumulating power and taking more from individuals and businesses when we should be thinking about the absolute opposite. That’s why we call it the land of make believe.” -Jonathan Williams

Economic Policies and State Competitiveness

Williams emphasizes the importance of states as “laboratories of democracy,” a concept rooted in the decentralized power envisioned by America’s founders. This decentralized power allows states to experiment with different policies, providing clear examples of what works and what doesn’t. Rich States, Poor States: The ALEC-Laffer Economic State Competitiveness Index, which Williams co-authors, highlights these differences by comparing states like Texas and Florida, which embrace freedom-loving policies, to states like California and New York, known for their big government approaches.

The Impact of Inflation and Tax Policies

A critical issue discussed is the impact of inflation and the potential expiration of the Trump tax cuts. Williams points out that the average U.S. household now needs an additional $1,085 per month to maintain the same consumption levels as in January 2021, due to inflation. The expiration of the Trump tax cuts, which include provisions like lower marginal income tax rates and an increased standard deduction, poses a significant threat to the economy. ALEC legislators are actively advocating to prevent this expiration, emphasizing the need for continued tax relief amidst the current economic challenges.

“We have just launched a letter signed by over 350 state legislators from across America, stating that it is not acceptable to allow this tax relief to expire during this time of Bidenomics and stagflation. This could be the last thing our American economy can withstand, and allowing the tax cuts to expire might push us into a recession. Beyond the macroeconomic effects at the national level, the impact on the average taxpayer could be absolutely crippling, especially considering inflation and the other challenges that hardworking families have had to navigate over the last several years.” -Jonathan Williams

The Debate Between Keynesian and Free Market Economics

Williams contrasts Keynesian economics, which advocates for increased government spending to stimulate economic growth, with free market economics, which promotes empowering individuals and businesses. He criticizes the Keynesian approach for its reliance on government intervention, arguing that it often leads to inefficiencies and fails to produce sustainable economic growth. Instead, he champions a free-market mindset where prosperity is driven by the creation of goods and services that benefit others.


In closing, Williams urges employers to stay informed about policy developments at both the state and federal levels. By doing so, they can better advocate for policies that support a thriving economic environment. ALEC’s resources, including Rich States, Poor States, offer valuable information for understanding and influencing economic policy.