Click here to download the guide.

The post Missouri’s Free-Market Policy Guide appeared first on Show-Me Institute.

Think of some of the top GDP growth states in the nation: Florida, Texas, Tennessee. None of these states have a state income tax. Free markets really do matter, and it has been demonstrated time and time again around the world and in the United States.

The Fraser Institute issues a periodic ranking of states according to “economic freedom.” According to its most recent ranking, Tennessee came in third—right ahead of number four Texas, but behind number one New Hampshire and number two Florida. Missouri came in at a respectable, but distant, number 15 ranking. Almost all of the “least economically free” states in Fraser’s report (New York, California, Illinois, West Virginia, and New Mexico), saw population loss.

Not coincidentally, Texas, Florida, and Tennessee have also dominated the U-Haul Growth Index, which measures the ratio of one-way, inbound U-Hauls versus one-way, outbound U-Hauls.

Granted, it is hard for Missouri to be Texas or Florida when we do not have the geographical gifts that those states enjoy.

But Tennessee is right on Missouri’s border and has much in common with the Show-Me State. Tennessee eliminated taxes that hamper growth (such as the Hall Tax, which taxed stocks and bonds), prioritized education reform to increase school choice and accountability, and its leaders are embracing its identity as a pro-growth, freedom-loving state.

Missouri has made recent progress in lowering the income tax burden. Since 2017, the top income tax rate has decreased from 6 percent to 4.7 percent for 2024.

Bringing the number down to zero should not just be a talking point—it ought to be a serious goal. If we want to be a top growth state, a nationwide destination for families, and attract more businesses, lowering the income tax is a great place to start.

I can speak from experience: having no state income tax is a luxury and a draw. Don’t we want that in our state too?

The post Slashing the Income Tax to Zero appeared first on Show-Me Institute.

Missourians have little recourse to deal with these rising costs. Missouri’s retail electric markets are monopolized, meaning that each Missourian only has one possible electric service provider.

But it doesn’t have to be this way. As I have written previously, thirteen states and the District of Columbia allow customers to choose between competing electric service providers. Looking at the time since competitive markets matured in 2008, the results have been quite encouraging, as shown in the graph below.

Source: Energy Information Administration

Missourians are losing ground when it comes to overall electric prices, too. In 2008, Missouri’s prices were quite low—43rd-highest overall electricity prices nationwide. Missouri’s prices now sit in the middle of the pack at 29th, due to the rapid price increases shown in the graph above.

Across every sector, competitive states are outperforming monopolized states—and especially Missouri—when it comes to lowering prices. Competition has helped make the electric service industry in those states more efficient and has passed on savings to customers. If lawmakers want to reduce the cost of living for Missourians while enhancing their economic freedom, they ought to consider embracing retail electric competition.

The post Why Missouri Should Embrace Retail Electric Competition in One Graph appeared first on Show-Me Institute.

In Mississippi, eyebrow threaders, eyelash technicians, and makeup artists can now operate without an esthetician license. Niche occupations such as these often get lumped into a license for which the training and education requirements are overly broad and don’t relate to the specific occupation. Missouri lawmakers fixed one example of this problem this year—a shampooer no longer needs to be a fully licensed cosmetologist or barber. In the future, lawmakers should review occupational licenses to make sure other niche occupations are unfairly burdened by license regulations and standards.

Ohio will enter the Interstate Medical Licensure Compact this year (and the Nursing Licensure Compact, of which Missouri is already a member), allowing workers to move and work more freely between states. Though Missouri has universal licensing reciprocity, compacts such as these would make it easier for Missouri licensed workers to work in other states that may not have universal reciprocity, but are in the same compact.

South Carolina will soon allow licensed barbers to apply for a license to operate out of a mobile unit and Nebraska repealed locksmith registration requirements after a licensing review found many problems with the current state of locksmith registration. Both measures increase opportunities for workers and consumers, which can ultimately promote economic freedom and growth in these states.

Missouri has another chance to do right by its workers next year. Though lawmakers have taken steps to curb the negative effects of occupational licensing, that forward momentum should continue. Missouri could create opportunities for workers and consumers and spur economic growth by ensuring niche occupations are free from broad licensing requirements, participating in interstate licensing compacts, and eliminating overly burdensome and ineffective licenses and restrictions. Using other states as a guide, we should pursue similar occupational licensing reforms next year.

The post Additional Opportunities in Occupational Licensing appeared first on Show-Me Institute.

The Mercatus Center’s latest version of its State RegData project analyzes state-level regulations by running a program that counts the number of times the words and phrases “shall,” “must,” “may not,” “required,” and “prohibited” appear in each state’s regulations. These words usually translate to regulatory restrictions, as these phrases, when included in regulations, typically tell you what you can or cannot do.

These words appear 93,915 times in Missouri state regulations, which translates to roughly 93,915 regulatory commands in our state. That’s almost 94,000 times where the state is telling you what you can and cannot do!

As you can imagine, some of these 94,000 regulatory restrictions seem inconsequential, unnecessary, and even ridiculous. A retailer may not participate in the sales tax holiday unless more than 2 percent of its merchandise qualifies for the tax holiday. The dental board may not issue any temporary license to practice as a dental hygienist in Missouri, though many other licensed occupations allow temporary licenses. The possession or use of beer bongs is prohibited on some rivers in Missouri but not others. Is this really what the state needs to be regulating? These are just three of the 94,000 instances where Missouri controls the actions of its citizens. To make matters worse, this number only includes state-level regulations; regulatory restrictions can be placed at the county and municipal levels, too.

Regulations are more often than not just red tape that Missourians must fight through to live their lives, and 94,000 pieces of red tape sure is a lot to fight through! Missouri saw some regulatory reduction during the “No MO Red Tape” initiative, but generally bureaucrats are much quicker to add regulations than to take them away. Regulations compound to suffocate businesses and workers, controlling what they can do and taking their resources. Why is Missouri making it harder for Missourians to run businesses, earn a living, and live productive lives?

The post Missouri Tells You What to Do 94,000 Times appeared first on Show-Me Institute.

The study found Missouri’s top two cities to be middle of the pack when it comes to economic freedom; of the top 52 metropolitan statistical areas (MSAs) Kansas City and St. Louis ranked 24^th and 22^nd respectively. Note that these are measurements of the city and the several counties around them, and so the policies of suburban communities like St. Charles and Johnson County are contributing to the whole.

The freedom index looked at three areas, each with three measures. Below are the three measures for each category, and St. Louis and Kansas City’s ranking in each category:

Government spending (Kansas City ranked 16^th, St. Louis 20^th)

• General consumption expenditure by government as a percentage of personal income
• Transfers and subsidies as a percentage of personal income
• Insurance and retirement payments as a percentage of personal income

Taxation (Kansas City ranked 30^th, St. Louis 20^th)

• Income and payroll tax revenue as a percentage of personal income
• Sales tax revenue as a percentage of personal income
• Revenue from property tax and other taxes as a percentage of personal income

Labor market freedom (Kansas City ranked 32^nd, St. Louis ranked 33^rd)

• Minimum wage (full-time income as a percentage of per capita income)
• Government employment as a percentage of total state employment
• Private union density (private union membership as a percentage of total employment)

All the urban core areas studied likely scored worse than the larger MSA they were in due to higher sales, property and income taxes, lower incomes, greater government employment and the resulting higher costs of public pensions.

The irony of municipal public policy is that cities are filled with the doyens of “do something.” They argue that cities must increase taxes here and there to fund programs that do this and that to solve real and imagined problems. But the real success is not in top-down command-and-control economies but rather in open and free economies where the people are free to earn and invest. It’s true of nations and it’s true of cities.

The post Free Your City and the Growth Will Follow appeared first on Show-Me Institute.

Cities across Missouri, including Kansas City and towns around St. Louis, have banned Airbnb outright in some areas. As we’ve written previously, this is an onerous and likely unconstitutional restriction on property rights. In 2017, home sharing advocates supported state legislation that would have pre-empted localities from imposing fees or prohibiting STRs outright, while permitting those subdivisions to impose “reasonable regulation” to “protect the public’s health and safety.” It may have been those undefined regulatory allowances that killed that bill, as supporters abandoned the effort at the end. A similar bill is being considered by the Missouri legislature this session.

The economic case for home sharing is compelling. Contrary to opponents’ fears, home sharing seems to increase home values in the surrounding area. However this has raised the concern that it increases rents as is displaces available housing units, although it hasn’t seemed to affect the hotel industry as much as hoteliers feared. As the industry matures, we will learn more about the consequences, intended or otherwise, of this new opportunity for homeowners.

Our guiding principle, however, must not be fear of change or of disruption, but protecting the economic freedom and individual liberty of Missourians. Protecting property rights against neighborhood NIMBYs remains a worthy endeavor.

The post Hoosier State Helps Home-Sharing appeared first on Show-Me Institute.

In his First Thanksgiving 1621, we see prosperous, black-clad Pilgrims in the company of new-found friends – bare-chested Indians in feathered war bonnets (one of several historical inaccuracies). The “thanks” here are for a bountiful harvest and the early realization of America as a land of milk and honey.

But how could it have been so easy for the settlers to carve a life out of the wildness in a cold and unknown land far from home?  Simple answer: It wasn’t, as most people instinctively recognize.

Out of 102 passengers on the Mayflower who arrived in Plymouth, Massachusetts, in December of 1620, 51, or exactly half, died from malnutrition or disease within a few months. The bereaved survivors must have been painfully aware of the precariousness of their own existence. They included William Bradford, the author of the classic Of Plymouth Plantation, who went on to become governor of the colony for many years. Gravely ill, his young wife, Dorothy May, either fell or threw herself to her death as the Mayflower lay at anchor in Cape Cod.

The Pilgrims did not build on a record of success.  As Donna Curtin, the executive director of the Pilgrim Hall Museum points out, “Many other colonies (in the Americas) had failed terribly.” Set up in 1607, the original English settlement in Jamestown, Virginia, had all but collapsed three years later – with 80-90 percent of its inhabitants lost to starvation and disease. In Ms. Curtin’s words, “They had murder, cannibalism, you name it – horrific, brutal conditions.”  No fewer than 10 colonies set up before Jamestown by the Spanish and French had also ended in disaster.

The Pilgrim leaders were well aware of this string of failures, as we know from Bradford’s journal. Coming with intact families and a strong sense of community, the Pilgrims bore more than a passing resemblance to the ancient Jews who sojourned in Egypt before going on to find their new home. Having fled religious persecution in England, the Pilgrims spent a dozen years in the Netherlands before fresh troubles there prompted many of their congregation to pin their hopes on the new world.

However, within three years of their landing, Pilgrims faced major problems of their own.   Bradford wrote:  “Famine began to pinch them [the Pilgrims] sore.”

The investors who paid their passage hoped to get an adequate payback on their investment in the founding company.  Fearing that would not be possible if people were free to farm their own land, they insisted upon “a common course and conditions” over the first seven years – under which there were no individual property rights and each member was entitled an equal share of total output.

Bradford recognized the demoralizing aspect of this arrangement. The industrious would subsidize the slackers; the most productive would get no more “in the division of the victuals and clothes” than the least productive. Instead of fostering harmony, communal property led to laziness, envy, thievery, poverty, and social dysfunction – just as it would in the 20^th Century through the spread of communism.

In 1623, Bradford and other leaders assigned to every family “a parcel of land” for its own use. With private property came economic freedom and individual initiative. “This had a very good result,” Bradford wrote, “for it made all hands very industrious” – leading to a big increase in corn production and far greater “contentment” for the community as a whole.

That’s how private property and economic freedom saved the Pilgrims. Happy Thanksgiving!

The post A Thanksgiving Reflection: How Private Property and Economic Freedom Saved the Pilgrims appeared first on Show-Me Institute.

HB 130’s passage means that Missouri will be an easier place to earn an extra income and get around. Rather than navigate a patchwork of rules and regulations—or none at all—TNC drivers and riders across the state will now all follow the same, reasonable rules. In some cities, like Kansas City, St. Louis, and Columbia, bureaucrats and special interests have attempted to regulate TNCs out of existence, killing jobs, slowing economic progress, and reducing consumer choice. HB 130 eliminates unnecessary barriers to market entry, thereby expanding economic opportunity (especially for the disadvantaged) and efficient transportation choices.

I commend the Legislature and Governor for advancing liberty and economic freedom by making HB 130 law. (The law’s swift progression has even prompted ossified and cartelized taxi firms to call for deregulation.) We’re hopeful this is just one of many free-market transportation reforms to become law over the next few years. 

The post HB 130 a Win for Transportation and Economic Freedoms appeared first on Show-Me Institute.

Read the full essay:

The post Is There a Link Between Economic Freedom and State Economic Growth? appeared first on Show-Me Institute.

Greg Glassman is a true entrepreneur. He is the CEO and founder of Crossfit, a rapidly growing fitness program (of which I am a huge fan). This week I heard him speak at a conference about the development of his business.

If I could recite his whole speech for you I would, but here is my takeaway: Glassman uses freedom to grow the Crossfit movement. Standardization works for some businesses, such as McDonalds, but Glassman realized that Crossfit would touch more lives if he allowed affiliates to use his fitness program and run their businesses how they chose.

None of the Crossfit methods are protected, and affiliates only pay to use the Crossfit name. There are no requirements to use a certain brand of equipment, to operate specific hours, or to run the gyms in any specific way.

Because of this, Glassman has enabled thousands of Crossfit gyms to open in the past few years. Glassman gives all of his affiliates an equal opportunity to survive and thrive on their own. This is important. Entrepreneurs like Greg Glassman create jobs, not the government.

Missouri, please learn from Glassman’s success. Show-Me Institute analysts have written about the importance of treating businesses fairly and allowing them to grow or fail on their own. Business growth means more job creation, less unemployment, and happier Missourians. Entrepreneurial growth such as Glassman’s means all the above plus more individual and economic freedom for all. Isn’t this what all of us want?

The post Crossfit Creates Jobs appeared first on Show-Me Institute.

The post How Economic Freedom Helped Rebuild Joplin appeared first on Show-Me Institute.

I have highlighted before on Show-Me Daily how Washington, D.C., and Saint Louis city place fewer restrictions on food trucks than certain municipalities in the broader Saint Louis area. This results in a lot of benefits, such as more food trucks, more choices for consumers, and more economic freedom.

Indian food and cupcakes are complementary goods (i.e., not subsititutes), so it’s more likely that both businesses are benefiting from their arrangement instead of one stealing business from the other. As I discussed recently, both businesses likely benefit from economies of agglomeration. Despite this, bricks-and-mortar restaurants are typically the biggest supporters of increasing restrictions. Instead of competing with food trucks on a level playing field, they attempt to convince the government to kick them out.

The post Food Truck Sighting in the Central West End! appeared first on Show-Me Institute.

The post Economic Liberty and Occupational Licensing appeared first on Show-Me Institute.

I want to keep this post concise, so I’ll just point out that Sen. Bill Stouffer has introduced legislation, S.B. 58, to change Missouri’s system. It does a number of good things. Most importantly, it removes the insane provision that anybody who wants to be a mover in Missouri has to prove to the government that there is a need for the new service. That is a decision for markets, not governments, to make.

This proposal would be a victory for economic freedom in Missouri. The bill is still in the early stages. It will likely have some changes, and in the end it may not be perfect. But the perfect needn’t be the enemy of the good, and so far the proposal looks promising.

The post Best Proposal of the Legislative Session So Far appeared first on Show-Me Institute.

For anyone who can’t make it to the Show-Me Forum, consider tuning in to Mike Ferguson’s radio show on Monday afternoon between 4:20 and 4:40, when Mr. Ferguson will interview me and Mrs. Brooke Gray, an equine dentist who has found herself in the crosshairs of the Missouri Veterinary Medical Board.

The post Come Meet Some (Alleged) Criminals! appeared first on Show-Me Institute.

Not a week after the health care bill’s passage, the Congressional Budget Office announced that Social Security would reach an ominous milestone: This year, Social Security will pay out more in benefits than it takes in from payroll taxes. Originally predicted to occur in 2016, the economic events of the past several years have hastened the crossing of this accounting Rubicon.

What does this imply? For one, the fund’s deficit will increase faster and be much greater than earlier projections. A few years ago, the CBO projected that the fund would run a deficit of about $50 billion in 2019. The new numbers push that estimate closer to $60 billion. The bottom line is that unless revenues are increased or payments are cut, Social Security will become insolvent earlier than the 2037 projection made several years ago. And, given the demographic characteristics of the population, that day is more likely to come even sooner.

What does Social Security have to do with health care? When we see that Social Security will become a larger budget burden in the future, it presages what we can expect from the move to socialize medicine in the United States. The problems arise from the fact that those who pass such legislation do not have the time horizon required to plan for long-term consequences.

In its rush to pass the first national medical plan Medicare and its companion Medicaid Congress sought the kind of political deals that get legislation passed but may ignore long-term economic consequences. Witness the financing difficulties that these programs face today. Some have argued that it is because of these programs that the delivery of health care has become so expensive: If the government is paying for it, why not run redundant tests?

How many times in the recent health care debate was it mentioned that failure to pass the bill (and vice versa) would have dire consequences for this fall’s election? If your time horizon is two years, should we expect someone to worry about consequences that may take decades to happen?

For those who believe that increased government involvement in their lives is a good thing, look to Great Britain. The government accounts for more than 50 percent of the economy’s gross domestic product. The economic crisis of the last few years has exposed the weaknesses of its extensive welfare system. Recipients of government services and those who administer them see no reason that services should be cut or taxes raised. As reported by the New York Times, Britain’s Chancellor of the Exchequer Alistair Darling said that “cuts in [government] spending would be wrong and dangerous.” Union leaders have averred that they will accept no cuts in pay. How, then, will increased deficits and a burgeoning government debt be financed? With weak economic recovery a likely scenario, it must be through higher taxes.

The United States is not Great Britain. Unfortunately, it does not appear that we are learning from their mistakes.

The shift to increasing the government’s presence in our daily lives seems inexorable. What makes this questionable is the revealed ineptitude of those who “run the business.” In good times, politicians spend money to curry political favor without due regard to potential risks. The multiple news stories depicting the plight of local school districts and state university systems facing shortfalls in state appropriations should give pause before we eagerly assign additional duties to the state.

The United States has long enjoyed a broad-based commonality with the British. Too bad that this will now extend to a decline in our economic freedom.

Rik W. Hafer is distinguished research professor and chair of the Department of Economics and Finance at Southern Illinois University Edwardsville and a scholar at the Show-Me Institute.

The post Health Care Reform Another Step in Decline of Our Economic Freedom appeared first on Show-Me Institute.