Montana State Overview
Montana has a better reputation for freedom than it really deserves. In fact, the state earns a mediocre score on personal freedom and a low score on regulatory freedom, even as its overall freedom score remains above average due to low taxes.
Fiscal policy, and especially tax rates, are the most favorable parts of the state’s overall ranking. Excluding motor fuel, severance, alcohol, and tobacco taxes, Montana’s taxes are just 7.7 percent of personal income. With mineral resources and stretches of highway used by long-haul truckers, the state is able to export some taxes to the rest of the country. Government employment and spending are high, due in part to own-source revenues not captured by the freedom index and in part to generous federal grants. Debt, at 17.6 percent of income, is slightly better (lower) than average.
On the regulatory policy side, labor laws score poorly, with a minimum wage, no right-to-work law, and a no-exception workers’ compensation mandate. Zoning laws rank better than average for the country, but worse than average among relatively rural, northern states. Eminent domain has not been sufficiently reformed. Health insurance mandates fell a bit in 2009—10, and the lack of guaranteed issue, community rating, or prior approval of premiums in the non- group market lead to a fairly high score on health insurance freedom. Telecom has been deregulated. The court system is well below average, and non-health insurance markets are relatively tightly regulated.
Alcohol distribution is highly state controlled at both the wholesale and retail levels; markups are low on beer but high on spirits. While Montana has a good medical marijuana law, its sentencing regime for marijuana offenses is otherwise harsh (one can get life in prison for a single conviction). Raw milk is banned. Asset forfeiture is unreformed. Tobacco taxes are high, and smoking bans are strict. Incarceration rates are above average. On the positive side for personal freedom, Montana does not arrest many drug users. Physician-assisted suicide is legal. Montana’s gun control laws are 15th best in the country. The state has an open container law and sobriety checkpoints but is otherwise relatively friendly to motorists. Private schools are almost unregulated, and home schools only slightly less so.
- Reduce government spending and employment in areas such as police and fire protection, corrections, education, general administration, housing and community development, parking lots, and miscellaneous commercial activities.
- Enact tort reform to improve the quality of the tort system. Also, amend the constitution to provide for the appointment of judges. With an average-quality court system, Montana would have scored 21st rather than 35th on regulatory policy.
- Reform sentencing for nonviolent offenders with a goal of reducing incarceration rates to about the national average. Such a reform would have increased Montana’s personal freedom ranking by seven places.