Washington’s Freest States Ranking: A Closer Look at Cato Institute’s “Freedom in the 50 States 2023” Report

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Washington's Freest States Ranking: A Closer Look at Cato Institute's "Freedom in the 50 States 2023" Repor

Seattle, November 17, 2023

In the recently unveiled “Freedom in the 50 States 2023” report from the Cato Institute, Washington finds itself positioned at a noteworthy No. 37 in the state freedom rankings. This extensive analysis, conducted by the libertarian think tank based in Washington, D.C., meticulously assesses individual freedoms across economic, social, and personal domains, providing an intricate understanding of the state’s policy panorama.

Washington’s placement in the second-to-last tier underscores its status relative to other states, residing among the five states deemed least free. The report arranges states on a spectrum from most to least free, painting Washington as part of the latter group. The evaluation indicates that Washington, often categorized as a stereotypical blue state, exhibits a stronger performance in personal freedom than in economic freedom.

Despite Washington’s historical adherence to a regulated economy, the report notes its advantageous position compared to similarly regulated neighbors like California and Oregon. The state’s fiscal policy earns recognition for its soundness, credited to the absence of an income tax. Nonetheless, the report underscores that Washington’s regulatory framework remains distant from the more permissive environment seen in neighboring Idaho.

While Washington refrains from imposing a state income tax, a capital gains tax was introduced in 2021. This tax, set at 7% for profits exceeding $250,000 from asset sales, has not significantly detracted from the overall favorable view of Washington’s fiscal policy.

However, the report points out some issues with how Washington handles land use and labor-market freedom. It mentions strict local and regional zoning and planning rules and widespread problems with eminent domain.

In terms of job-related freedom, Washington gets some flak for not having a right-to-work law, restricting choices for workers’ compensation programs, and having minimum wages that are quite high compared to what people generally earn.

Right now, the minimum wage in Washington is $15.74 an hour, and it’s slated to go up to $16.28 an hour next year, making it the highest state minimum wage in the U.S.

On a positive note, the report commends Washington for its commendable criminal justice policies, describing them as “among the best in the nation.” The state has witnessed a decline in incarceration and victimless crime arrest rates, attributed to changes in policing and predating marijuana legalization. In 1998, Washington made medical marijuana legal, and in 2012, the state also legalized the recreational use of cannabis.

However, the report points out recent changes in legislation, including the approval of a bill in a special session held in May. This legislation classifies purposeful possession or public consumption of small quantities of illicit substances as a modified gross misdemeanor. Governor Jay Inslee signed this legislation just before the expiration of a temporary statute that would have essentially decriminalized drug possession in the state.

The Cato Institute’s “Freedom in the 50 States 2023” report identifies the five freest states as New Hampshire, Florida, South Dakota, Nevada, and Arizona. In contrast, the five states deemed least free are New York, California, Hawaii, Oregon, and New Jersey.

As Washington grapples with its ranking, the report contributes to the ongoing dialogue regarding the delicate balance between personal and economic freedoms in the state’s policy framework.

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