It may be the littlest state, but Rhode Island’s economic meltdown is among the biggest in the nation, arguably second only to Michigan’s, the New York Times reports. Rhode Island’s 10% unemployment rate ranks second, and its average income, $39,827, pales before neighboring Massachusetts and Connecticut. No one’s sure exactly why, although many residents think the state’s size is a factor.
“The whole political system is based on back scratching,” says a local journalist. “That’s true for every place, but more so here because of the intimacy.” The state’s high school graduation rate—38th in the nation—doesn't help either, nor do personal and corporate taxes that hover around a lofty 9%. One ex-GE chairman once called it “the 48th-most-acceptable state for business.” (Read more Rhode Island stories.)