Why Are America’s Best Credit Scores in Wisconsin?

The people with the best credit scores live in Wisconsin. That may be because there are few pockets of poverty there. Any other explanation would be hard to prove. It would also be hard to prove that there is any set of circumstance that would make these scores much worse, or that the areas with poor credit scores are likely have those credit scores get any better.

The new Experian “Annual State of Credit Map” shows that among the ten cities with the best credit scores are Wausau, Green Bay, Madison and La Cross, Wisconsin. Close-by Minneapolis is on the list as well. Most of the cities on the list share many of the characteristics of Wisconsin cities. Their populations are homogenous and mostly white. Unemployment in the areas tends to be low.

The other end of the credit spectrum is in cities that include four of the poorest cities in Texas — Corpus Christie, Harlingen, Tyler and El Paso. These are border towns with concentrations of immigrants. Among the other cities at the bottom of the list are Las Vegas, Jackson, Mississippi, and Shreveport and Monroe, Louisiana.

The Experian data are part of broad set of statistics that show that the regions of poverty, low education attainment, collapsed home prices and unemployment are in the same place they have been for years. A good demographer can point them out on any map of the U.S. No government program or social engineering has been able to change the fates of these regions. They are proof that all demographics are local. These cities cannot be compared to some national median. They are aberrations, even within their own states, in most cases.

There is a theory that the unemployment and education problems in the U.S. can be solved with broad policies that work from the top down. The federal government can provide money for “shovel-ready” programs and tax credits for firms that hire out-of-work people. In the poorest parts of the nation, there are not likely to be healthy construction firms ready to begin new work. And there are certainly not businesses that can hire new workers for a tax credit of several thousand dollars.

Credit scores are low in parts of Texas and Mississippi because there are few jobs in those places, little food and education, and a lack of government programs aimed at the most troubled geographic sections of America. The old saying is that it takes credit to get credit. That is as true in the poorest parts of Louisiana as it is in the richest parts of Wisconsin.

Douglas A. McIntyre