Pierre has been too busy tooting its own horn about ad hoc funding for Mount Rushmore to shout much about the Tax Foundation's latest low-tax propaganda declaring South Dakota great for business and Minnesota awful due to state tax policy. When South Dakota Republicans do get around to it, be sure to remind them they are full of hooey.

Our Republican friends also like to talk about creating jobs and boosting income as signs of economic and political success. But Governing runs employment and income numbers against the Tax Foundation's rankings and finds conservative's touted pro-business tax policies don't translate into those real measures of economic gain. Here's a chart showing the non-correlation they find between the Business Tax Climate Score percentage of the population working:


Governing highlights Minnesota as an excellent example of this non-correlation:

A few of the Tax Foundation’s lowest ranked states are actually among the strongest performing in terms of current employment indicators.

The report singled out Minnesota, for example, because the state enacted policy changes said to have hurt competitiveness, particularly a retroactive individual income tax rate hike. Accordingly, the state fell three slots from last year’s report to the 47th worst in country.

To the contrary, Minnesota’s job market is quite strong. As of August, its unemployment rate stood at 5.1 percent – tenth lowest of any state. Elsewhere, it stacks up even better against other states. Its employment-to-population ratio is 66.7 percent, fourth best nationally [Mike Maciag, "Analysis: Do Business-Friendly Tax Climates Yield the Most Jobs?" Governing, 2013.10.10].

Business Tax Climate Score be darned, Minnesotans have lots of jobs to choose from. They also get better wages to keep them from falling for Governor Daugaard's mall pitch. Here's a chart showing the non-correlation between those tax scores and median annual wages:

wage-statechartI've noted before that the Tax Foundation's Business Tax Climate Score doesn't correlate with folks' sense of well-being. These economic dots scattered without relation to tax policy expose the Business Tax Climate Score as an exercise in ideology over empirical analysis, cheering for one's own beliefs instead of studying what really puts people to work and money in their pockets.