The 27th State: Missouri’s Place in “Rich States, Poor States”
For folks in the free-market movement, the annual publication of Rich States, Poor States (RSPS) in many ways marks time. The book is part almanac and part analysis; it explores the minutia of state economic policies nationwide, highlights ongoing state economic successes or failures, and assesses the prospects of states succeeding economically in the future.
It always makes for interesting reading, and this year’s edition (released last week) is no exception. Missouri’s economic performance has bounced along RSPS’s bottom quintile of states since its first edition, and unfortunately Missouri hasn’t made much progress since 2008; Missouri now ranks 42nd of 50 states in economic performance for 2015. That finding is consistent with economic assessments we’ve shared with readers in the past. Simply put, the state hasn’t made a lot of economic progress over the last decade relative to its peers.
Missouri is seeing movement in its “economic outlook”—but it’s all in the wrong direction. In 2012 Missouri ranked 7th for how bright its economic future appeared, which at the time I noted that the ranking looked a bit like an aberration. Only three years on, however, the state has dropped back to 27th overall. That is the worst Missouri has ever done in RSPS’s outlook ranking, dating all the way back to 2008 when the state ranked 25th. Suffice it to say, a weak economic track record paired with a mediocre economic outlook doesn’t inspire a lot of confidence in the status quo.
The fact is not a whole lot changed from 2013 to today, which is sort of the problem. States across the country are pursuing tax cuts and regulatory reforms in earnest, and yet Missouri has been slow to respond for years. Last year’s tax cut was an important first step toward turning the economic tide, but it is too small and being too slowly instituted to be a last step. Time is running out for the legislature to do much on the tax issue this year; it will be interesting to see if the body chooses to do nothing.