Only One Governor Earns Top Score on Cato’s Governors Report Card

Governors Schwarzenegger, Bush, Owens and Pataki receive lower grades than in 2004

October 19, 2006

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WASHINGTON — Republican Governor Matt Blunt of Missouri earns the highest score on the Cato Institute’s eighth biennial fiscal policy report card released today.  Out of 46 governors reviewed, Blunt is the only governor this year to receive the grade of A for cutting his state’s budget, eliminating hundreds of government jobs and restraining Medicaid spending.

Republicans Rick Perry of Texas and Mark Sanford of South Carolina are the next two highest scoring governors, receiving B’s for their solid commitments to keeping taxes and spending burdens low throughout their entire terms.  The highest scoring Democratic governors are Phil Bredesen of Tennessee and John Lynch of New Hampshire, both of whom received grades of B.

Nine governors, however, receive an F:  Kathleen Blanco of Louisiana; Michael Easley of North Carolina; Christine Gregoire of Washington; Kenny Guinn of Nevada; Mike Huckabee of Arkansas; Ruth Ann Minner of Delaware; Janet Napolitano of Arizona; Bob Riley of Alabama; and Brian Schweitzer of Montana.

Of the 26 governors running for reelection this year, 11 earn a grade of D or lower:  John Baldacci of Maine; Rod Blagojevich of Illinois; Jim Douglas of Vermont; Jim Doyle of Wisconsin; Dave Freudenthal of Wyoming; Ted Kulongoski of Oregon; Linda Lingle of Hawaii; Janet Napolitano of Arizona; Bob Riley of Alabama; Arnold Schwarzenegger of California; and Kathleen Sebelius of Kansas.

California Governor Arnold Schwarzenegger, who topped the 2004 governors report card with an A, drops to a D this year due to an overall increase in his state’s budget.  Governors Jeb Bush of Florida, Bill Owens of Colorado, George Pataki of New York and Bill Richardson of New Mexico also earn lower grades despite receiving accolades in previous years.

The “Fiscal Policy Report Card on America’s Governors: 2006,” by Cato director of budget studies Stephen Slivinski, emphasizes the importance of tax cuts and provides evidence showing that “states that reduce taxes improve their prospects for economic growth.”

The latest report card grades 46 governors on 23 objective measures, awarding the highest grades to those who have reined in spending and cut taxes.  Governors from four states (Alaska, Idaho, New Jersey and Virginia) were excluded from the study either because they assumed office too recently or for technical reasons.

Other key findings of the report include:

  • Constitutional spending restraints and tax cuts are arguably the best solution for bloated budgets during boom years and for out-of-control deficits during lean years.
  • Flat taxes create fewer economic disincentive effects and make state revenue less volatile.
  • Medicaid must be reformed to avoid rising healthcare costs from consuming state budgets. 

“The lesson of the last 20 years is that governors can’t tax and spend their way to prosperity; they should stop trying,” writes Slivinski.  The complete report contains detailed state-by-state data.

Policy Analysis Paper no. 581