2022 State Economic Competitiveness Rankings Reveal Taxpayers Voting with Their Feet
The trends highlighted in Rich States, Poor States tell a story of the free-market ideals that win for taxpayers, and the consequences that follow when they’re ignored. Rich States, Poor States economic outlook scores are a leading indicator of what’s to come. People are voting with their feet. They’re headed to opportunity states.
Top-ranked Utah and bottom-ranked New York tell story of migration into well-run states and exodus from poorly-run states
Arlington, Va. – (April 18, 2022) The American Legislative Exchange Council (ALEC) releases today, the 15th edition of Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index – its newest publication in an annual series illustrating each state’s competitiveness and economic outlook. Used by lawmakers across the states since 2007, Rich States, Poor States is authored by Reagan Economist Dr. Arthur B. Laffer, FreedomWorks economist Stephen Moore and ALEC Chief Economist Jonathan Williams.
The 15 economic policy variables used by the authors to rank the economic outlook of states have proven over time to be influential for state competitiveness and growth. This report shows that cutting taxes, paying down debt and maintaining free market policies have significantly helped states attract new residents.
|Top 10 States||Bottom 10 States|
|1. Utah||41. Oregon|
|2. North Carolina||42. Maryland|
|3. Arizona||43. Hawaii|
|4. Oklahoma||44. Maine|
|5. Idaho||45. Illinois|
|6. Nevada||46. Minnesota|
|7. Indiana||47. Vermont|
|8. Florida||48. California|
|9. North Dakota||49. New Jersey|
|10. Wyoming||50. New York|
“Americans continue to vote with their feet toward states that have lower tax burdens and value economic competitiveness,” said Jonathan Williams, ALEC Chief Economist and Executive VP of Policy. “Rich States, Poor States teaches us that states with lower taxes, especially those that avoid personal income taxes, have seen significantly better rates of in-migration than states with high income tax rates.”
Utah has been ranked #1 for the past 15 years in a row. Utah has a strong track record of pro-taxpayer reforms in recent years, including the adoption of a flat personal income tax rate, pension reform for its previously endangered system, and the state’s innovative approach to property tax reform.
“If you believe incentives matter, and I do, state policies have the effect of changing those incentives at both the state and local levels,” said Dr. Arthur Laffer. “Those changes in incentives have consequences. This ranking of states is a tried-and-true formula. I think it is a great way of picking winners and giving guidance on how states should be effectively governed.”
North Carolina has now achieved its best ranking to date, landing at 2nd overall for economic outlook. Since the passage of historic tax reform in 2013 when the state ranked 22nd, North Carolina has continued to lower taxes and foster economic growth.
“This study has had a big impact on what state officials, governors and legislators are doing,” noted Stephen Moore. “This is a magic moment for tax reform at the state level. I think even in some of these blue states that have been traditionally very liberal, they’re looking at reforms that could really make their states more prosperous. I think the direction is good, and I think a lot of that direction is a result of the Rich State, Poor State rankings,” Moore concluded.
“The trends highlighted in Rich States, Poor States tell a story of the free-market ideals that win for taxpayers, and the consequences that follow when they’re ignored,” said ALEC CEO Lisa B. Nelson. “Rich States, Poor States economic outlook scores are a leading indicator of what’s to come. People are voting with their feet. They’re headed to opportunity states.”
The American Legislative Exchange Council is the largest nonpartisan, voluntary membership organization of state legislators in the United States. The Council is governed by state legislators who comprise the Board of Directors and is advised by the Private Enterprise Advisory Council, a group of private, foundation and think tank members. For more information about the American Legislative Exchange Council, please visit: www.alec.org.