Tax Reform

The Key to Unlock Your State’s Potential: Rich States, Poor States

How can state policymakers best position their states to thrive?

The answers can be found in today’s release of Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index. Co-authored by economists Arthur B. Laffer, Stephen Moore and Jonathan Williams, the report, now in its 13th edition, ranks the 50 states on Economic Performance and Economic Outlook. These rankings are based on  equally weighted policy variables that have a proven impact on the migration of capital – both investment and human – into and out of states.

For example, what are the top personal and corporate income tax rates in a state? Does the state levy an estate tax? How large is the property tax burden? What is the state minimum wage? Is there a Right-to-Work law? In total, 15 policy variables are examined to calculate the Rich States, Poor States ranking on Economic Outlook, which is a forecast on state economic growth.

Once again, Utah has the claimed number one ranking for Economic Outlook, followed by Wyoming and Idaho. The worst state for Economic Outlook this year is New York, followed by Vermont and Illinois.

Rich States, Poor States: Economic Outlook (13th Edition)

Top Ten Bottom Ten
1.      Utah 41. Rhode Island
2.      Wyoming 42. Oregon
3.      Idaho 43. Montana
4.      Indiana 44. Connecticut
5.      North Carolina 45. New Jersey
6.      Nevada 46. Minnesota
7.      Florida 47. California
8.      Tennessee 48. Illinois
9.      Oklahoma 49. Vermont
10.   Arizona 50. New York

The Economic Performance ranking reveals how state economies are currently performing. This ranking is based on three variables: Cumulative GDP Growth, Cumulative Domestic Migration and Non-Farm Employment Growth. In other words, how much is a state’s economy producing? Are citizens moving to the state or fleeing to greener pastures? Are jobs being created?

Rich States, Poor States: Economic Performance (13th Edition)

Top Ten Bottom Ten
1.      Texas 41. Kansas
2.      Washington 42. Illinois
3.      Utah 43. West Virginia
4.      Colorado 44. Louisiana
5.      North Dakota 45. New Jersey
6.      Florida 46.Wyoming
7.      South Carolina 47. New Mexico
8.      Oregon 48. Alaska
9.      Tennessee 49. Mississippi
10.   Georgia 50. Connecticut

In addition to the latest rankings and data, features an “Adjust Policies” tool that allows users to see how a policy change would impact their state.

As legislators grapple with the economic fallout from COVID-19, it is more important than ever to adhere to free market and limited government principles that empower states and their citizens to thrive. To that end, the new edition of Rich States, Poor States will serve as a valuable guide.

In Depth: Tax Reform

Mainstream economists, small business owners and taxpayers across the country understand that growth-oriented reforms mean increased opportunity for all. As demonstrated by the annual Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index, sound tax and fiscal policies are critical to economic health, allowing businesses and households to flourish. A…

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