NCPA - National Center for Policy Analysis

Proposals Could Foster Job Creation and Innovation within States

April 11, 2013

To refocus states on the principles of limited government and free markets, researchers at the American Legislative Exchange Council (ALEC) recently proposed model legislation in nine subject areas that would lead to jobs, innovation and growth. Below are some examples.

  • States that are facing huge structural deficits created by overspending will be tempted to raise taxes, raid non-general fund accounts, delay funding for some legislation and avoid fully funding pensions. Instead, states should amend state constitutions to limit the growth of spending and taxes, empower governors with a line-item reduction veto to eliminate pork spending and require two-thirds majorities to raise taxes.
  • With an estimated $4.6 trillion in unfunded pension liabilities, states will have to slash pensions or dramatically increase taxes and cut core government services to cover pensions and worker retirements. Instead, states should replace defined-benefit plans with defined contribution plans, which would expose taxpayers to less risk.
  • Twenty nine states have passed renewable energy mandates, which force electric utilities to provide a percentage of total energy as green energy, raising costs. Environmental permitting also slows investment and development. States should repeal the renewable energy mandates.
  • States have an unnecessary amount of regulation that small business owners and manufacturers say stifles their ability to innovate and create jobs. Instead, state lawmakers should review the compliance costs of regulations before they are implemented and provide businesses with flexibility.
  • States require occupational licenses that keep many unemployed or low-income workers from pursuing an occupation. If lawmakers limit government occupational licenses and help ex-convicts into the workforce, more individuals will be able to return their lives to normal.
  • Growing threats to privacy and security on the Internet threaten to stifle innovation. Policymakers should enact laws that prohibit the use of spyware and standardize the regulation of Internet telephony across all 50 states.
  • To improve the future of America, states should focus on improving education and educating brighter youth who will ultimately lead to a more productive economy. To do so, states should encourage charter schools, vouchers, education savings accounts and online education.

ALEC also recommends that states promote a health care system that encourages competition and create an efficient and fair legal system that roots out fraudulent and frivolous lawsuits.

Source: "ALEC 2013: Jobs, Innovation and Opportunity in the States," American Legislative Exchange Council, 2013.


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