Kentucky not growing up to its potential

How can Kentucky still be trailing competitor states in population growth?

It’s not like we as a state are stuck in some out-of-the-way region with poor access to roads and attractive sites for development and growth.

Most Kentuckians live and do business within a day’s drive of 60% of the entire U.S. population.

Both Interstates 75 and 65 are among the nation’s most heavily traveled north-south corridors.

Yet the Census Bureau reports that Kentucky’s population grew by a miserly 3.8% between 2010 and 2020.

Such paltry growth trails each of the benchmark states analyzed in “The Lost Decade: Kentucky’s Economic Underperformance 1980-2020,” a report authored by Andrew McNeill, former Deputy State Budget Director and Visiting Policy Fellow with the Bluegrass Institute.

As McNeill tweeted in response to the population-growth numbers, it truly was “another #LostDecade” for Kentucky.

Two of four benchmark states – North Carolina and Tennessee, which experienced 9.5% and 8.9% population growth respectively – grew more than twice as much as Kentucky between 2010 and 2020.

While the growth in the other two states – Alabama (5.1%) and Indiana (4.7%) – wasn’t as dramatic, it still left Kentucky trailing.

McNeill chose those four states as benchmarks because 40 years ago Kentucky was essentially as wealthy as those competitors.

But the Bluegrass State failed to keep pace in many areas, including population growth – an indicator of whether a state’s policies and performance serve as a magnet or repellant.

It’s no coincidence that four of the five states with higher tax burdens in 2020 than Kentucky – New York, Oregon, Maryland and California – also rank among the bottom 10 on U-Haul’s annual migration growth index.

Neither is it surprising that Kentucky had such sluggish population growth considering it’s among the nation’s highest in per capita government spending – higher, in fact, than New Jersey, Illinois and California, which rank dead last at Nos. 48, 49 and 50, respectively, on U-Haul’s index.

While U-Haul makes it clear that its migration trends don’t correlate directly to population or economic growth, it explains the data offers “an effective gauge of how well cities and states are attracting and maintaining residents.”

We also should note what’s happening at the top of U-Haul’s list, where Tennessee last year replaced Texas and Florida, which took turns topping the listing since 2015.

U-Haul Company of Nashville president Jeff Porter claims he’s “seeing a lot of people move” from California to Tennessee as fallout from COVID-19 “has pushed a lot more people away from the West Coast to our state.”

Porter notes that Tennessee “has no income tax and is very business-friendly” and has “plenty of jobs,” which caused the state to flourish and grow even in a year dominated by the pandemic.

While Kentucky has moved up on U-Haul’s index, it remains mired closer to the middle of the pack, slowed in its growth by the consequences of choosing policies of government redistribution rather than unleashing growth potential with bold strides toward more business-friendly economic freedom.

A state’s policies are considered its advertising platform by those voting with their feet, offering either opportunities to grow or hindrances that have negative impacts as mass departures from high-tax, big-government states with less economic freedom begin to occur and those feet-voters react to what’s available.

Kentucky’s paying the price for far too often across choosing policies mirroring those of declining states like California, Illinois and New York for far too many decades rather than emulating those benchmark competitors which are growing their populations and economies.

Now, we’re far too often forced to watch as ambitious individuals, energetic entrepreneurs and business owners use those interstate highways to pass through Kentucky on their way to greener pastures filled with greater economic freedom.

Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at jwaters@freedomkentucky.com and @bipps on Twitter.

Editor’s Note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after being published by newspapers statewide.