In the midst of economic turmoil, federal bailouts, and budget deficits in more than 40 states, a new report from the American Legislative Exchange Council (ALEC) offers a roadmap to recovery based on economic performance trends from states over the last 10 years. The second edition of "Rich States, Poor States" shows how the federal bailout of the states may simply encourage out-of-control spending by states, which is up 124 percent over the last 10 years, without requiring them to make the tough decisions needed to bring about financial stability.

“Too many states were too eager to add programs and increase spending during the good times, but we now face very difficult choices,” said Indiana Senator Jim Buck, Chairman of ALEC’s Tax and Fiscal Policy Task Force. “While we need to make tough choices to live within our means, we also need to remain focused on policies that foster economic development and job growth as the best solution to our budget woes.”

Co-author and renowned economist Dr. Arthur B. Laffer summarized the report's finding when he said, “States cannot tax their way into prosperity.” "Rich States, Poor States" presents rankings of the 50 states based on the relationship between policies and performance, revealing which states are best positioned to make a recovery, and which are not. Stephen Moore, senior economics writer at The Wall Street Journal, and Jonathan Williams, director of the Tax and Fiscal Policy Task Force for ALEC, are also co-authors.

In this year's Index, Hawaii ranked 21st in "Economic Performance" and 41st for "Economic Outlook" -- virtually unchanged from the 2008 findings.

The American Legislative Exchange Council is the nation’s largest individual membership organization of state legislators dedicated to advancing the principles of free markets, limited government, federalism and individual liberty. To read more about the state-to-state comparisons, see the individual state analysis, and view the full report, download it for free at www.alec.org.

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