West Virginia's Jim Justice ranks as fourth-worst governor for economic freedom in new report

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West Virginia Gov. Jim Justice is the fourth-worst governor for economic freedom when compared with every other governor in the country, according to a report released by the American Legislative Exchange Council.

ALEC, a conservative think tank, released its first-ever governors’ rankings last week in the Laffer-ALEC Report on Economic Freedom: Grading America’s 50 Governors. The report ranked America’s 50 governors based on policy performance and executive leadership before and after the start of the COVID-19 pandemic.

“West Virginia suffers from burdensome levels of spending and debt,” ALEC Chief Economist Jonathan Williams said in a statement. “West Virginia will benefit if Governor Justice adopts a free market approach and gets state spending and debt under control.”

The state has the highest spending in the country as a proportion of gross domestic product. It ranked 12th in proposed and enacted changes to state policy, but ranked poorly in other spending categories.

West Virginia ranked 46th for its high welfare spending per capita. It ranked second worst in education policy, which weighs per-pupil spending, school-choice participation and National Assessment of Educational Progress reports. It also ranked ninth worst in union policy, which weighs the number of public employees, public employee raises and prevailing wage laws.

The state ranked 31st for its handling of federal Coronavirus Aid, Relief and Economic Security Act money, which was used for COVID-19 relief, and 24th in its tax policy.

West Virginia ranked third-worst in its remaining tax burden per $1,000 of personal income, which was $26.71. The state had the 11th-highest personal income tax progressivity and ranked below the median in top marginal personal income tax (6.5%) and in recently legislated tax changes.

However, West Virginia performed well in some categories. The state does not levy an estate tax, and it ranked 10th-best for its low debt services as a share of tax revenue, which is 4.6%. It ranked 16th in its sales tax and property tax burden and 22nd on its top marginal corporate tax rate.

Garrett Ballengee, the executive director of the free-market Cardinal Institute for West Virginia Policy, told The Center Square, the state has been in an economic slump for decades and there’s a lot of opportunity for comprehensive, free-market reforms.

“It’s safe to say that the state has had a real opportunity to expand economic freedom over the previous few years, but it’s an opportunity that has gone, mostly, unrealized,” Ballengee said. “Government spending has continued to rise, state debt has gone up with the passage of a large amount of debt-financed infrastructure projects, and this is all within a context of dwindling state population. I think the state will struggle with these realities for generations if it doesn’t take a different path towards greater economic freedom.”

Ballengee said the governor should use his power to discuss a comprehensive plan for increasing economic freedom, reducing the size of government and expanding school-choice opportunities for families. He suggested eliminating the income or inventory tax, cutting red tape, reducing occupational licensing and certificate-of-need laws and establishing student-centered education funding.

Justice was elected as a Democrat, but switched to the Republican Party in 2017 and announced his support for President Donald Trump. He is facing re-election in November, but polls suggest he will defeat his Democratic challenger Ben Salango.

The governor’s office did not respond to a request for comment from The Center Square.

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