What is the secret of America’s success? Federalism. Thanks to the genius of the Founders, each state is allowed to do things differently, which enables innovation.
It is so exciting to see Mississippi now leading the way with bold, free-market reforms that have begun to unleash growth, providing a model for other states to follow.
After decades being last, Mississippi is has started to see some remarkable results:
Explosive Economic Growth: In 2024, Mississippi’s real GDP grew by 4.2%, ranking 2nd nationally, outpacing California (2.1%), New York (1.8%), and Texas (3.9%), per the BEA’s Q4 2024 data. Nominal GDP jumped 6.7% ($2.58 billion), also 2nd in the nation.
Surging Incomes: Personal income growth ranked 4th nationally in Q3 2024. From 2000 to 2022, per capita income soared 140% (3.6% annually), from $21,500 to $46,200. With our low cost of living, Mississippians are enjoying one of the most rapid increases in living standards in America.
Mississippi personal income has increased rapidly
Global Competitiveness: Being a British immigrant, I was fascinated to see that in 2023, Mississippi’s per capita output surpassed the UK’s. Even better, this year, we’re projected to overtake Germany’s per capita output.
Investment Boom: Over $20 billion in new investment projects have been announced in the past couple of years. That means private dollars are investing in the future of our state because they think we have a great future.
This economic renaissance didn’t happen by accident. Growth is a direct consequence of the kind of free market reform MCPP has been advocating for:
Historic Tax Cuts: In 2022, Mississippi passed the largest tax cut in state history, phasing in a 4% flat income tax by 2026.
Labor Market Deregulation: By reducing red tape, we’ve empowered businesses to hire and innovate, boosting job creation (some estimates suggest 56,000 export-related jobs in 2022 alone).
Conservative Budget Responsibility: A steady budget surplus has been important.
Low cost energy: Mississippi managed to avoid a lot of the renewable energy policies that have pushed up costs in places like California.
We need to maintain this new momentum – and to do that there are plenty more policy changes we must make. Education standards are not as good as some would like to suggest. It is vital that we allow school choice. There are far too many red tape restrictions holding back the local economy, especially the protectionist rules in the healthcare sector.
Most important of all, perhaps, our state leaders need to restrain public spending, which has increased rapidly. We need to ensure that we continue to control spending so that we maintain modest budget surpluses.
But let’s take a moment to recognize that Mississippi is actually doing rather well. So much so, in fact, that other states might have something to learn from what our state leaders have got right.
