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July 07. 2011 10:50PM

William Ruger and Jason Sorens: New Hampshire serves citizens well by securing their freedom

Recently, we presented findings from our new study “Freedom in the 50 States” (available at www.mercatus.org) in a legislative briefing at the State House, sponsored by the Josiah Bartlett Center. Unfortunately, news coverage of that event has been dominated by the claims of the handful of protestors who showed up, organized by the left-of-center website Blue Hampshire. We would like to set the record straight about our research and what we recommend for New Hampshire.

We start with a clear, traditional definition of freedom: allowing people to do what they want with their own lives, liberty and possessions, so long as they don’t infringe on the same rights of others. Using this definition, we quantify and rank state and local governments’ respect for freedom for all 50 states, looking at a wide range of public policies in the fiscal, regulatory and personal realms. After we collected and combined the data, we found that New Hampshire is the freest state in the country, essentially tied with South Dakota. On the other end, New York is by far the least free state in the union, with New Hampshire’s neighbor Massachusetts placing a lowly 46th.

Why should people care? We think freedom matters for its own sake, but it turns out also to have important social benefits. States with more freedom, due to lower taxes or less regulation on people’s lifestyle choices, see net in-migration from states with less freedom. That means people are voting with their feet, something Granite Staters understand quite well given the influx of “refugees” the state attracts from other states in the Northeast. One of the starkest statistics is that nearby New York — the land of transfat bans, eminent domain abuse and high taxes — has lost nearly 10 percent of its 2000 domestic population, while New Hampshire has added nearly 3 percent of its population from other states in the same period. We believe that a key reason New Hampshire is attracting more movers than any other New England state is its greater respect for individual liberty.

We also find that economic freedom promotes personal income growth. Fiscal and regulatory policies matter for creating the economic environments where individuals and businesses can thrive. Thus, it is little surprise that New Hampshire is quite a bit richer than Vermont and Maine, even though the latter states enjoy even larger tourist industries as a percentage of their economies.

Our study also provides recommendations for all 50 states. The policy prescriptions we make for New Hampshire are hardly radical or outlandish; they are all based on policies that have already been working for other states. Even though New Hampshire is the freest state on our index and is a beacon to other states, there are plenty of areas where it is falling behind and would benefit from change.

For instance, we argue that New Hampshire should reform its asset forfeiture system, which currently allows the government to take your property if it is suspected of being used in a crime or obtained from the proceeds of crime — and you then have to sue the government to get it back. Surely “innocent until proven guilty” should be the standard for losing your property, just as it is for losing your liberty.

We also support reviewing New Hampshire’s strict occupational licensing regime. By our estimate, 24 percent of the New Hampshire work force now requires a state-level license to practice a profession. According to Princeton University economist Morris Kleiner, less than 5 percent of the U.S. work force was licensed just 60 years ago. Kleiner also finds that licensure in most occupations drives up prices for consumers without much or any improvement in quality. For instance, Vermont does not license landscape architects, but New Hampshire does. So that’s probably why you’ve been hearing about that epidemic of killer gardens in Vermont. What, you haven’t?

A moderate reform would be to convert many of these occupational licenses to certifications. Practitioners would have to reveal to the customer whether they are state-certified or not, and customers can then choose whether to use their services. More thoroughgoing change would get the government out of the business of licensure or certification in many areas since things like Angie’s List and word-of-mouth are better indicators of quality service than a piece of paper from a government bureaucrat.

From our discussions with legislators, we gather that the current Republican majority is keen to consider these reforms and others that would improve the environment for business investment in New Hampshire. We certainly hope they follow through on their free-market principles; the citizens of New Hampshire will be the beneficiaries.

William Ruger is an assistant professor of political science at Texas State University. Jason Sorens is an assistant professor of political science at the University at Buffalo.


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