Report: Pa. among worst-run states
When Pennsylvania gets rated highly for the generosity of its residents or rated poorly for the size of its pension debt, there are hard numbers that can be looked at to make such judgments.
But when it comes to judging how well a state government is performing, that’s a more nebulous undertaking. Nevertheless, financial information website 24/7 Wall St. has attempted to do just that, compiling data on unemployment rates, pensions, GDP growth, poverty rates and the states’ credit ratings to put together a ranking of all 50 states.
After putting all those varied numbers together, study author Samuel Stebbins came to the conclusion that Pennsylvania is the 36th-best run state in the nation. Put another way, that makes it the 15th-worst run state.
Stebbins, in publishing his results, acknowledged that there are some drawbacks to associating the specific data points he used with the quality of any given state government.
“It is important to note that current economic and social conditions in a given state are often not the result of the work of sitting elected officials,” he wrote. “High-level governing strategies and budget priorities can have consequences that extend far beyond the tenure of those who make them.”
Regardless, there’s no denying that Pennsylvania isn’t doing great in several of the categories that the report looked at.
Pennsylvania was tied for 40th with a 4.9 percent unemployment rate, more than double Hawaii’s nation-leading rate of 2.4 percent. When it comes to the percentage of its pension obligations that are funded, the state was ranked 44th best at just 52.6 percent; topranked Wisconsin was 99.1 percent funded.
Things were slightly better, though still not too impressive, when it comes to GDP growth, where Pennsylvania was tied for 15th best at 2.2 percent, while Washington state had more than
double that amount at 4.7 percent. For poverty rate, the state was tied for 22nd best at 12.5 percent, almost five points worse than New Hampshire’s first-place mark of 7.7 percent.
When it comes to credit ratings, only Illinois, Connecticut and New Jersey were judged to be worse than Pennsylvania’s Aa3 score from Moody’s.
“After Rhode Island and neighboring New Jersey, Pennsylvania ranks as the worst run state in the Northeast,” Stebbins wrote. “Pennsylvania has enough money set aside to meet only about half its total pension obligations, a far smaller share than most states.”
The report noted that Pennsylvania doesn’t currently have any money set aside in its rainy day fund, though it noted that the 2018-19 budget provides for some funds to be deposited.
Overall, Oregon was judged to be the best-run state, while Louisiana landed in last place in the combined rankings.
The nonprofit Commonwealth Foundation has argued for some time that legislation limiting government spending would be a good start for Pennsylvania to begin to address issues like those noted in the 24/7 Wall St. report.
“The 2019-2020 General Assembly has a chance to implement spending restraint by passing the Taxpayer Protection Act, which passed the state House last year,” the foundation’s Elizabeth Stelle wrote recently. “In addition, state lawmakers should pursue comprehensive tax relief, imitating the success of North Carolina where spending controls and tax relief resulted in robust economic growth and budget surpluses. If spending limits had been enacted in 2003, the state would currently be spending $2 billion less with no talk of budget deficits. And the average family of four would have $10,000 more in their pockets.”
The proposed Taxpayer Protection Act would use the three-year rates of inflation and population growth to put a strict cap on how much government spending could increase in any single year.