Virginia – A legend in its own mind. The U.S. Department of Commerce has published the 2011 GDP growth for each of America’s 50 states. Virginia, the oft-cited best state for business, finished in 40th place. The Old Dominion squeaked out a barely positive 0.3% GDP growth rate in 2011. U.S. real GDP by state grew by an average of 1.5% in 2011. This marks the second year that Virginia has fallen behind the national average. Last year (2010), Virginia finished with a 3.0% growth rate. The overall average growth rate for the U.S. was 3.1%.
What do you feed an invisible cat? Evaporated milk. Virginians have seen and heard little from Lt Governor Bill “the jobs czar” Bolling lately. Perhaps Virginia’s dismal economic performance is one reason that Lt. Gov. Bolling is keeping a low profile. After all, there is more than a year until the next governor’s election and maybe Virginia’s economy will improve between now and then. Meanwhile, Gov Bob McDonnell has been visiting Sweden while Marco Rubio is being vetted for the Vice President slot on the Republican ticket. Perhaps Mr. Romney has an aversion to running with the governor of an economically under-achieving state. Of course, even Virginia’s #40 position is better than where Gov Romney took Massachusetts during his tenure as governor. I seem to remember #47 being bandied about.
The Best State for Business? The Richmond spin machine never sleeps. There is no end of surveys, polls and projections touting Virginia’s brilliant economic performance and, by proxy, the excellence of its state government. Jim Bacon posted a blog entry entitled, “Virginia’s Major Metro Economies Looking Pretty Darn Good” just five days before the state GDP figures were published. In the post, Jim notes that Virginia’s three biggest metropolitan areas were rated among the country’s top economic performers by the Brookings Institution. Bacon went on to write, “Outside Virginia’s major metro areas (and Charlottesville), the economy was not so hot.” It seems that may be something of an understatement. Just recently, Bacon found an even more far-fetched “analysis” of Virginia’s economic prospects which he detailed in his post, “We’re No. 4! We’re No.4!”.
Crying Uncle (Sam). Virginia is a major beneficiary of the recent unprecedented level of government spending. Yet, even with that, the state is incapable of achieving even average GDP growth. The open question is how far Virginia’s economic performance will fall once the inevitable government cutbacks begin. There is good news. We’re number 40 now and there are only 50 states – we only can fall 10 more places.