Nebraska State Overview
Nebraska falls a little behind some other Great Plains states, particularly on fiscal policy. Indeed, the levels of taxation and spending are difficult to square with the state’s conservative ideology.
Government consumption plus subsidies in Nebraska is more than a standard deviation above average. Taxes remained at 9.7 percent of personal income throughout the period from FY 2008 to FY 2010, marginally worse than average. Debt and public employment are about average. However, the state fares well on fiscal decentralization, nearly three standard deviations more decentralized, for its population, than average.
The state scores well on regulatory policy. Rights in real property are generally respected, but the state’s eminent domain reform has essentially been symbolic only. Labor laws score well on right-to-work and other issues. Nebraska declined dramatically on health insurance freedom in 2009—10, due mostly to newly enacted mandates, which add up to 51.2 percent of the cost of a typical policy. There is no guaranteed issue or community rating in nongroup markets, although there is prior approval of nongroup premiums, and the small group market has basic rating bands common throughout the country. Nebraska has deregulated telecom. Occupational freedom is generally above average. The state’s liability system is one of the very best in the country. Like most states, Nebraska has retained a certificate-of-need (CON) law for new hospital construction, reducing competition and choice.
On personal freedom the state is basically average. The firearms regime is mediocre, considering that Nebraska is a fairly rural state. The main reason for this score is the fact that Omaha is permitted to enact restrictions that do not apply statewide. Marijuana laws are harsh: low-level cultivation or sale carries a mandatory minimum of a year in prison, and a higher-level conviction can carry up to 50 years in prison. Educational freedom could be improved. Nebraska requires state approval and teacher licensure for private schools, but there are broad exemptions. The home school regime is liberal overall, but notification requirements are burdensome, and there is no statute explicitly authorizing home schools. Unlike many other conservative states, Nebraska has very low incarceration and victimless crimes arrest rates. Alcohol taxes are low, and the state has no role in distribution. Tobacco freedom is a bit below average.
- Trim spending on education and utilities, where the state spends more than the national average. Property, utilities sales, and individual income taxes are all slightly higher than average. Even an average fiscal policy score would have lifted Nebraska to 18th on overall freedom.
- Repeal the CON law for new hospital construction. This single reform would have raised Nebraska one place on the regulatory policy, economic freedom, and overall freedom rankings.
- Eliminate regulations that affect private schools, including mandatory registration, approval, and licensure, and specific curricular requirements. Relax notification requirements for homeschoolers.