South Dakota ranks second while Virginia leaped five spots from last year to third. The bottom three consists of the usual suspects: Maine, Vermont and New York rank No. 48 to No. 50 respectively.
Until the full report becomes available on Wednesday, we won’t know for sure if Kentucky has improved from last year’s ranking of No. 40. However, if we can get any indication from former Reagan administration economist Arthur Laffer’s repeated comparisons of Kentucky with neighboring Tennessee, a region free of state income taxes, Kentucky’s odds of significant improvement are long.
The ALEC-Laffer State Economic Outlook ranking is a forecast based on level of current state spending, mode of taxation, and what the states are actually spending on. Here is a link to the 2010 report.
Urging advocates to continue the good fight against excessive state taxation, Laffer left reporters with an unexpected nod to the Rastafarian, Bob Marley: “Those who are trying to make the world worse never take a day off. How can we?”
Visit back this Wednesday for an update on Kentucky’s 2011 economic outlook.
By Phil Impellizzeri, Bluegrass Institute intern