The real Condition of the State: Less prosperous. Less popular. Less fair.
Iowa can do better, but we need new leaders.
Iowa Gov. Kim Reynolds delivered her Condition of the State address on Tuesday.
The governor, who is not seeking re-election, said she is determined to finish strong. But regular Iowans already know the true condition of the state during Reynolds’ tenure. It can be summed up in these three phrases: Less prosperous. Less popular. Less fair.
The evidence for this judgment is everywhere.
Iowans instinctively know we are less prosperous than we used to be.
Since Reynolds became governor in 2017, our economy has stagnated. Real GDP growth in Iowa has fallen to an average of 1.4% per year, roughly half of what it was in the previous eight years. Job creation has cratered. Since Reynolds took office, Iowa has created just 3,100 non-farm jobs per year on average. In the eight years before, it was 13,500 per year. We’re not even keeping up with adjoining states.
More recently, Republican policies have damaged our economy even more.
President Trump’s tariffs not only have failed to bring manufacturing jobs back to the US, but they’re causing higher prices in America’s supply chain. Deere & Co., a major employer in Iowa, said recently it expects to take a $1.2 billion hit this year because of tariffs, twice what it did in 2025.
It’s not just manufacturing, of course.
Farm income in Iowa for 2025 was expected to fall 37% from its peak in 2022, according to one estimate cited by the Des Moines Register. And Trump’s aid package won’t be enough to cover the “significant financial damage” farmers suffered last year from high production costs and the trade war with China, according to the American Soybean Association.
Yet not a single Republican leader in Iowa has stood up to Trump to say: Stop it. You’re hurting us.
All this is happening as Iowa becomes less popular.
Popularity, as measured by population growth, has always been a challenge for our state. We don’t have mountain scenery, oceans or sandy beaches. Our winters are harsh. Yet, Reynolds and legislative Republicans are making it tougher to say yes to Iowa.
They made our state infamous nationwide for their unprecedented ban on books. They’ve pursued public servants at county courthouses and state universities who dared to stray from their idea of acceptable speech. They are hostile to the immigrants who supply what little population growth this state has.
Iowans have gotten the message. Many are leaving. Our state ranks 7th worst in the nation (4th worst when adjusted for population) for young college-educated people moving out of state, according to Common Sense Institute Iowa, a business group. Overall, both Atlas Van Lines and U-Haul released data for 2025 recently that showed the exodus from Iowa is getting worse. Atlas ranked Iowa 7th worst in the nation for “outbound moves.” U-Haul’s ranking said Iowa dropped 12 places in its index from the previous year to 15th worst in the nation.
Iowa’s lack of growth is not only driven by what political leaders in Des Moines are doing, but what they’re failing to do. A 2024 Register article sampled the opinions of Iowa college students who were planning to leave the state. A number of them cited political and economic factors, but one person said he planned to leave Iowa because, “there’s not much to do here.”
Iowa has faced this perception for decades. I remember feeling and hearing this sentiment when I was a young person, too. But when was the last time anybody in a leadership position at the state capital confronted this problem? Our leaders used to care, but apparently no more.
They aren’t even adequately dealing with the issues facing young people who want to stay in this state: Take housing prices. Over the last five years, the housing price index in Iowa has risen about 44%, according to federal figures. Previously, it took more than 16 years for prices to rise that much.
It was good to see Reynolds briefly touch on this issue Tuesday, proposing a tax incentive for first-time home buyers. But housing prices began spiking years ago.
Finally, Iowa is less fair.
It used to be that Iowa’s state government lived by the belief that, if you were financially well-off, you would be taxed at a higher rate on some of that income. Working-class families wouldn’t be taxed at the same rate as millionaires. The idea was that since sales and other consumption taxes dug deeper into the pockets of regular people than the rich, a progressive income tax system—the “fair tax” as some have called it—would help balance the scales.
However, Reynolds and company decided that the rich were paying too much, so they jettisoned this Iowa tradition and changed the law. This has shifted a greater share of the cost of government to the rest of us.
Consequently, Iowa will also face budget deficits for years to come. This year alone, Iowa’s operating deficit is projected to be $1.3 billion. Reynolds proposed a budget Tuesday that, according to current estimates, would create a deficit of more than $1 billion for 2027.
Surpluses will cover some of these shortfalls, but the most likely outcome will be to lock in for years to come existing reductions, in real terms, for basic services like public schools, where 9 out of 10 Iowa kids attend classes. In the meantime, Reynolds and the GOP created a $345 million annual subsidy for families, including the state’s richest, whose kids go to private schools.
They won’t even allow Iowans whose kids go to public schools to use this subsidy to pay for private tutoring expenses, even though tutoring programs are shown to have positive results in other states.
No, to get this subsidy, you have to go to a private school.
That’s not fair.
This just scratches the surface. There are plenty of other inequities. Like how the few, under the protective wing of Iowa’s Republican leaders, foul our waterways and push the consequences on to the rest of us.
We know Republicans in the Legislature won’t reverse these trends and may even seek to make them worse. The question is, when it comes to this year’s elections, will Iowans say we’ve had enough?
Will we change directions and choose prosperity and fairness?
I hope so. Perhaps, if we do, Iowa might even have a better chance of becoming more popular.
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Thanks Ed. The fact that our Governor and her Republican majority won't allow public school families to use these funds for tutoring—despite evidence that tutoring works—reveals this isn't about educational quality or "school choice." It's about funneling taxpayer money to private institutions while starving the public schools that serve the vast majority of Iowans.
I await legislators and candidates announcements to commit to amending this program--especially for those who read your column.
Thanks for consistently providing facts.