Kentucky

Kentucky Governor Matt Bevin (R) took office in 2015 and immediately worked to implement numerous radically redistributive economic policies favoring corporations at the expense of workers, promising an abundance of jobs and prosperity. But the commonwealth still hasn’t seen tangible benefits after three years of Bevin’s administration.

“We are going to get rid of the very things that frankly send the message to the outside world that we’re not serious about being a business-friendly state,” Gov. Bevin said during his inauguration speech in 2015, promising to repeal the estate tax (which affects only the very wealthiest) and cut budgets for state agencies. “We’re going to break those things down and we’re going to turn this state into the type of place that people not only want to come to, but they want to stay. We are already.  We could be much greater indeed.”

However, after three years of Gov. Bevin’s administration — in which he cut tax rates for the commonwealth’s wealthiest individuals at the expense of tax rate hikes for the other 95 percent of Kentuckians, and signed across-the-board budget cuts for state agencies including K-12 and higher education — those promises haven’t panned out.

Last week, the Louisville Business Journal reported on a new study from financial site WalletHub, which ranked each state’s economy using 28 different criteria including GDP growth, startup activity, growth of good-paying jobs in high-tech industries, and entrepreneurial activity. Kentucky ranked #41 on WalletHub’s list, scoring a mere 35.88 out of 100.

Source: WalletHub

The commonwealth scored relatively high in categories like exports per capita (#5) and economic activity (#25), but remarkably low in other categories like economic health (#42), innovation potential (#47), and government surplus per capita (#48).

Comparatively, some of the highest-scoring states on WalletHub’s list are states with some of the highest tax rates in the country. While Washington state (#1 according to WalletHub) doesn’t have a state income tax, its sales tax is one of the nation’s highest. Massachusetts (#3) and California (#4) have progressive tax rates in which the wealthy pay proportionally more as a means of funding public services. Both Washington state and Colorado, which ranks #5 on the list, has a booming legal marijuana industry (along with Massachusetts and California), in which the state collects hundreds of millions of dollars in revenue each year to be invested in K-12 education and healthcare.

Out of the seven states that neighbor the commonwealth, only West Virginia’s economy (#48 overall) ranked lower than Kentucky’s. Illinois came in at #35, Ohio’s economy ranked #31, Missouri’s economy is ranked #29, Tennessee is #26, Indiana ranked #23, and Virginia is ranked #19. While many of these states are host to industries and highly skilled workers that allow them to rank high in certain economic criteria (Virginia is home to the Department of Defense, for example), the fact that all but one of Kentucky’s neighbors outperforms the commonwealth economically is hard to ignore.

Gov, Bevin can at least take solace in the fact that his state’s economy isn’t as bad as the economies of Louisiana (which ranked #51 out of all 50 states and Washington, DC), Mississippi (#50), and Alaska (#49), all of which are Republican-controlled states with regressive tax systems in which corporations and the wealthy pay almost no taxes.

 

Tom Cahill is a contributor for Grit Post who covers political and economic news. He lives in Bend, Oregon. Send him an email at tom DOT v DOT cahill AT gmail DOT com.

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