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The Best and Worst Run States in New England

Saturday, November 23, 2013


Rhode Island ranked last in New England for 24/7 Wall Street's "Best and Worst Run States" -- see who was first.

Rhode Island this week ranked #47 on 24/7 Wall Street's "Best and Worst Run States in America" survey of how well states are managed -- and ranked in the top five nationally for budget for debt per capita, as well as unemployment.

What makes one state better than another, in terms of how its run? According to Wall Street 24/7, it in part involves looking at criteria including fiscal measurements, such as a state's budget deficit and debt per capita, as well as quality of life, including unemployment and median household income.

24/7 Wall Street noted that "many of the best-run states in the nation benefit from an abundance of natural resources" -- and that states must deal with the cards it is dealt, and governments must plan for worst-case scenarios, including the collapse of an industry. URI Distinguished Professor of Business Edward Mazze, said, however, that for Rhode Island, the "worst-case scenario" has arrived.

"We are stuck in neutral. How do we get out of this situation? Let's look at a five county government structure, a smaller legislature and term limits for political offices. Then we can focus on the things we need to do to create jobs. We need our "best and brightest" to come up with solutions to our economic problems rather than the "same old, same old."

See How the New England States Ranked BELOW

Just how severe is the current situation in the state? 24/7 Wall Street writes that Rhode Island had more debt per resident than any other state except for Alaska and Massachusetts as of fiscal 2011 -- and Moody’s cited the state’s eight consecutive years of budget gaps as part of its justification for its relatively poor credit rating."

While Rhode Island ranked last in New England on the best-to-worst list, Mazze thought that the state's resource assets have not been fully utilized. "Rhode Island's sustainable competitive advantages are its location and nearness to major markets, seaport and airport, universities and medical facilities and workforce. These advantages have not been effectively used to attract and maintain businesses or to create jobs."

"There is no vision and no leadership (other than sound bytes) by state officials and others in office and running for office on what Rhode Island could be. Our strategy to compete with Massachusetts regarding casinos.....is no different than how we do most things.... watch what happens and then take action or add more table games. We do not have a focused strategy for economic development....we have meetings and more meetings and legislation and more legislation. One year its biotech, the next year it is the knowledge district," said the Professor, after outlining above what he saw as needing to get done.

However, at least one industry leader in Rhode Island said he believed that the state's resource assets were numerous -- and attracting business

The RI Film and Television Office's Steven Feinberg talked about Rhode Island's assets -- which benefit the film industry.

Steven Feinberg with the state's Film and Television Office said that Rhode Island has had success in landing projects in the state -- because of its unique assets.  

"We have diverse locations in close proximity -- our city/state set up makes a number of different locations possible," said Feinberg. The producers of Infinitely Polar Bear told me that not only does this provide a great location, but we're able to control the environments."

"I like to say in big cities you're a number, but here you're a neighbor," said Feinberg. "We're the smallest state, but we've got the greatest backlot. If we need to close down a street, I can go to (the Office of) art, culture, and tourism, Colonel Pare, Chief Clements."

Feinberg was most excited however, about the future of the industry in the state. "Back in 2004, I think there was one college with a film program. Now they all have them. High school kids are getting involved. Digital media production is the norm. And then we have Wes Anderson filming here, and Rhode Island film student interning with him.

"I tell students who want to leave for New York, LA -- what's wrong with going down the street? Get your hands dirty here and be a big fish in a small pond. I've seen PAs become location managers, then production managers, in short order. You can grow here, and quickly."

Asset Management, Growth

As Rhode Island looks to climb out of the last spot in New England for "how it's run", Mike Stenhouse with the Center for Freedom and Prosperity offered his thoughts that the state could do better with its assets -- and that the climate itself would have to change.

"Indeed, Rhode Island is not capitalizing on its greatest assets - our natural resources and our people. With a high state sales tax, and an even higher meals and hospitality tax, we are unwittingly stifling job creation and actually harming our vital tourism industry by creating financial disincentives for people to visit our beautiful state. Imagine how many more people would jam up I-95 to vacation, shop, work, and live and in our state if we eliminated the sales tax.

With regard to planning for the future, we are already at the worst case scenario: now is the time for a new public policy culture. If we are ever to significantly change the economic dynamic in our state, we have heard repeatedly from local and national experts that our state must be bold enough to embark on a fundamental shift by moving towards a lower tax-and-spending approach to improve our business climate.

"The only way we can ever hope to pay for all the commitments our state has made, and to survive the budget challenges ahead, is to rapidly expand our state's tax base through aggressive economic growth policies. We must give families and businesses a clear reason "why" they can prosper in our state. 


Related Slideshow: Best and Worst Run States in New England

How well do the New England states stack up against each other in terms of how they're currently run?

According to Wall Street 24/7, looking at a state's debt per capita, budget deficit, unemployment, median household income, and percentage below the poverty line are all indicators of a state's level operational success - or lack thereof.  

Below are how the New England states were ranked compared to each other, based on data from 2012 -- as well as the "best run" and "worst run" states in the country. 

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Rhode Island

National Rank, #47

> Debt per capita: $8,721 (3rd highest)
> Budget deficit: 6.9% (35th largest)
> Unemployment: 10.4% (3rd highest)
> Median household income: $54,554 (18th highest)
> Percent below poverty line: 13.7% (tied-20th lowest)


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National Rank, #41

> Debt per capita: $8,531 (4th highest)
> Budget deficit: 17.1% (12th largest)
> Unemployment: 8.4% (tied-14th highest)
> Median household income: $67,276 (4th highest)
> Percent below poverty line: 10.7% (4th lowest)


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National Rank, #30

> Debt per capita: $4,447 (12th highest)
> Budget deficit: 16.6% (14th largest)
> Unemployment: 7.3% (tied-22nd highest)
> Median household income: $46,709 (16th lowest)
> Percent below poverty line: 14.7% (tied-24th lowest)


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New Hampshire

National Rank, #25

> Debt per capita: $6,414 (8th highest)
> Budget deficit: 20.0% (8th largest)
> Unemployment: 5.5% (8th lowest)
> Median household income: $63,280 (7th highest)
> Percent below poverty line: 10.0% (the lowest)


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National Rank, #18

> Debt per capita: $6,414 (8th highest)
> Budget deficit: 20.0% (8th largest)
> Unemployment: 5.5% (8th lowest)
> Median household income: $63,280 (7th highest)
> Percent below poverty line: 10.0% (the lowest)


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National Rank, #6

> Debt per capita: $6,414 (8th highest)
> Budget deficit: 20.0% (8th largest)
> Unemployment: 5.5% (8th lowest)
> Median household income: $63,280 (7th highest)
> Percent below poverty line: 10.0% (the lowest)


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Worst Run State in US

50. California

> Debt per capita: $3,990 (20th highest)
> Budget deficit: 27.8% (3rd largest)
> Unemployment: 10.5% (2nd highest)
> Median household income: $58,328 (11th highest)
> Pct. below poverty line: 17.0% (18th highest)


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Best Run State in US

1. North Dakota

> Debt per capita: $3,033 (20th lowest)
> Budget deficit: None
> Unemployment: 3.1% (the lowest)
> Median household income: $53,585 (19th highest)
> Pct. below poverty line: 11.2% (6th lowest)



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