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Michigan’s economic performance ranked in national report

Michigan’s economic climate and future outlook are ranked 35th and 17th nationally in a newly released report from the American Legislative Exchange Council.

The report says that “cutting taxes, paying down debt and maintaining free market policies have significantly helped states attract new residents.”

Economic climate analyzes past state financial performance – including State Gross Domestic Product (GDP), absolute domestic migration, and non-farm payroll employment – weighted equally. These variables are highly influenced by state policy.

“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.”

The report uses 15 economic policy variables, including tax burden, the legal system, the minimum wage, the size of government, the role of labor unions, and public debt, to rank the economic outlook of states.

“Generally speaking, states that spend less – especially on income transfer programs – and states that tax less – particularly on productive activities such as working or investing – experience higher growth rates than states that tax and spend more,” the report said.

The report gave Michigan high marks for tax cuts, enacting Right-To-Work laws, and pension reform. Michigan’s economic outlook has increased 17 spots from No. 39 in 2009.

Rich States, Poor States is authored by economist Dr. Arthur B. Laffer, FreedomWorks economist Stephen Moore, and ALEC Chief Economist Jonathan Williams.

Top five states:

  • 1. Utah
  • 2. North Carolina
  • 3. Arizona
  • 4. Oklahoma
  • 5. Idaho


  • 45: Illinois
  • 46. Minnesota
  • 47. Vermont
  • 48. California
  • 49. New Jersey
  • 50. New York

This report argues that cutting taxes, paying down debt, and maintaining free-market policies have significantly helped states attract new residents.

“If you believe incentives matter, and I do, state policies have the effect of changing those incentives at both the state and local levels,” Laffer said in a statement. “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 ranked 2nd overall for economic outlook, which one researcher credited to 2013 tax reform when the state ranked 22nd.

“This study has had a big impact on what state officials, governors and legislators are doing,” Moore said in a statement. “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.”

This article was originally posted on Michigan’s economic performance ranked in national report

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