The Problem
With its resources, location, expansive farmland, and first-class towns and cities, Illinois should be a leading economic powerhouse in the United States. Unfortunately, thanks to an unfriendly business and regulatory climate, Illinois has been underperforming for years. “Rich States, Poor States,” a comprehensive economic performance index authored by Steve Moore, Art Laffer, and Jonathan Williams spells out the startling facts about Illinois. Out of the 50 states, Illinois ranks 48th in economic performance. According to the 2010 ALEC-Laffer State Competitiveness Index, Illinois is doing better than only two states: Michigan and Ohio.

According to this report, as well as government data, Illinois also ranks:

• 47th in economic outlook. Neighboring Missouri and Indiana rank well ahead in terms of future opportunity, at 15th and 20th respectively.
• 44th in GDP growth, averaging only 4.95% per year from 1998-2008 while the U.S. average was 6.59%.
• 37th in debt burden. Illinois continues to spend government revenue growth on government expansion rather than funding past debt obligations, including pensions.
• 36th in personal income per capita growth, averaging 4.5% in 1998-2008 while the U.S. average is 5.1%.
• 48th in employment growth from 1998 till 2008, ranking ahead of only Michigan and Ohio.
• 48th in absolute domestic migration, with 637,979 people leaving the state from 1999-2008. Only two states—California and New York—lost more people.
• 47th in the U.S. Tort Liability Index for 2010.
• 7th highest in median property taxes paid on homes in 2009.
• 14th highest in number of days spent working in 2010 to pay federal, state, and local government taxes.
• 11th highest in property tax burden per capita.
• 6th highest gas tax burden—approximately 39 cents per gallon.
• 1st in sales tax burden (Chicago & Cook County) of a major U.S. city.
• 6th highest combined state and average local sales tax rate, at 8.4 percent.

Illinois is shrinking in wealth, once ranking as high as 6th in per capita personal income and dropping to 13th in 2009. The growth of the Illinois economy has lagged the rest of the country for the past three decades.

Our Solution
The solution: lower taxes; responsible spending; transparent, accountable government; and a business-friendly environment that empowers entrepreneurs, investors and workers instead of expanding government bureaucracies.

Why This Works
Low-tax, low-spending, low-regulation states have fared far better economically over recent years. If Illinois is to reclaim its place as a land of prosperity, leaders must consider smarter policies that maximize liberty and keep the state in check.