All Of A Sudden, Louisiana Has Made The Top 20 In The Rich States, Poor States Rankings

This doesn’t mean we’re the 18th-richest state in the union, but it does mean that Art Laffer, Stephen Moore and Johnathan Williams, who annually produce the American Legislative Exchange Council’s “Rich States, Poor States” report, do hold recent changes in tax and regulatory policy in fairly high esteem.

The report ranks states using 15 different policy variables, and the rankings for 2025 aren’t based on current performance so much as a future projection based on the policies each state is pursuing.

For example, Louisiana ranks 50th, dead last, in the report’s state economic performance rankings for the period 2013-23. We were 48th in state gross domestic product, 43rd in absolute domestic migration, and 47th in non-farm payroll, and those metrics combined to put us in the cellar.

That said, the writeup of Louisiana’s prospects for 2025 was awfully sunny…

If you look at the graphs on the left, which indicate Louisiana’s actual performance, what you’ll see is what an utter disaster John Bel Edwards was as the governor of this state. Our GDP performance was a little better than average nationally mostly because Edwards raised taxes through the sky and put Louisiana on the Obamacare Medicaid expansion in 2016, his first year in office, and in so doing he grew government spending so much that it artificially inflated the state’s economy. But that was a sugar high; by 2019 we were back to underperforming the national average and our economy was crashing even before COVID hit. And when COVID hit and Edwards’ lockdowns kicked in, he just about killed this state.

The bottom graph shows the non-farm payroll employment trailing below the national average pretty consistently other than in the immediate post-COVID bounce. And the middle graph on the left, showing net migration, is an absolute horror show.

Bobby Jindal might have been many things and not all of them were good, but when Jindal was governor Louisiana’s outmigration problem had been kept in abeyance. Some years we were positive on net and some years we were slightly negative, particularly at the end when oil prices took a dump and folks in the oil business started moving to West Texas where the money is now, but we never had a wholesale outmigration when Jindal was governor.

With Edwards, it was a full-on Texodus, and that graph shows it.

It’s not just that Laffer, Moore and Williams love Jeff Landry, though here’s a really nice quote

In addition, the report “[highlighted] impressive upward mobility” for Louisana, West Virginia and Arkansas. Louisiana jumped 13 spots in economic outlook, from 31st in 2024 to 18th in 2025 due to a “sweeping tax overhaul [that] boosted its competitiveness across major tax categories,” according to ALEC. Tennessee also earned its best ranking ever, placing second for economic outlook. West Virginia also finished 16th, seven spots above 2024, for “continued improvements in fiscal policy.”

Louisiana’s results marked “an incredible turnaround for what had been a laggard state in the Southeast, which is an incredibly competitive region,” Williams told The Center Square. The state’s recent passage of a flat tax was a big part of why it climbed so far in the rankings.

…but the state has had a pretty consistently better prospective ranking than performance in the annual Rich States, Poor States rankings. That’s troubling, as it indicates we’re underachieving based on policy.

The states ranking at the top of this year’s study – Utah (3) is first, followed by Tennessee (12), Indiana (21), North Carolina (11), North Dakota (46), Arizona (2), Idaho (4), South Dakota (16), Texas (7) and Arkansas (19) – are generally pretty high performers as noted by the numbers in parentheses which indicate their performance rankings from 2013-23.

Louisiana has generally been fairly middle-of-the-pack in its prospective ranking while at the bottom of annual performance, which tells us that while these rankings are generally pretty decent predictors of how a state will do (North Dakota being an outlier, but that’s explainable by the fact that the Bakken oil boom cooled pretty rapidly over the past few years and the state’s rapid growth fell off along with it despite the fact they’re doing lots of things right from an economic policy standpoint), they don’t predict Louisiana well.

We should be doing better than we are. Laffer, Moore and Williams think we ought to be changing that soon. Let’s hope they’re right. We’re concerned that there are factors not in this report, like insurance rates and political corruption, which are in our way.

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