How well run is your state? It can be difficult to objectively assess the quality of a state’s management. The economy and standard of living can be affected by decisions made decades ago, forces outside the control of the state’s government and administrators, as well as the government’s own actions.

Every year, 24/7 Wall St. tries to answer this question by conducting an extensive survey of every state. To determine how well states are managed, we examined their financial data, as well as the services they provide and their residents’ standard of living. This year, North Dakota is the best-run state in the country for the second year in a row, while California is the worst-run for the third year in a row.

Read: The Best and Worst Run States in America

Identifying appropriate criteria to compare the 50 states can be challenging because they vary so much. Some states have abundant natural resources, while others rely on services or innovation. A few have been burdened by struggling industries. Some are more rural, while others are more urban. Because of such differences, a spending or tax policy that can be beneficial in one state can be disastrous in another.

Many of the best-run states in the nation benefit from an abundance of natural resources. North Dakota, Wyoming, Alaska, and Texas, among the best-run states, are all among the states with the greatest concentration of GDP in the mining industry, which includes activities such as oil and natural gas extraction, as well as coal mining. The presence of this industry benefits states in several ways. North Dakota and Texas led the nation in real GDP growth in 2012, while Alaska has used its oil revenue to establish a permanent fund that pays residents an annual dividend.

The housing crisis has had a major negative impact on a number of the worst-run states. It caused a drastic decline in construction employment in states like Arizona, California, and Nevada. Many of these lost jobs have yet to be replaced. In the hardest-hit states, this has resulted not only in worsening unemployment, but increased poverty and budget shortfalls. Although the economies of these states have largely improved, the residual effects of the housing crisis remain.

While these can be considered extenuating circumstances, the fact is that each state must deal with the cards it is dealt. Governments must plan for worst-case scenarios, including the collapse of an industry. Several resource-rich states have squandered their advantages and rank poorly on our list. Good governance involves raising and spending enough to provide for the well-being of the population without risking the state’s long-term stability.

To determine how well the states are run, 24/7 Wall St. reviewed hundreds of data sets from dozens of sources. We looked at each state’s debt, revenue, expenditure, and deficit to determine how well it was managed fiscally. We reviewed taxes, exports, and GDP growth, including a breakdown by sector, to identify how each state was managing its resources. We looked at poverty, income, unemployment, high school graduation, violent crime and foreclosure rates to assess the well-being of the state’s residents.

While each state is different, the best-run states share certain characteristics, as do the worst run. For example, the populations of the worse-off states tended to have lower standards of living. Violent crime rates in these states were usually higher and residents were much less likely to have a high school diploma.

The worst-run states also tended to have weak fiscal management reflected in higher budget shortfalls and lower credit ratings by Moody’s Investors Service and Standard & Poors.

The better-run states tended to display stable fiscal management. Pensions were more likely to be fully funded, debt was lower, and budget deficits smaller. Credit ratings agencies also were much more likely to rate the well-run states favorably. Only two poorly run states received a perfect credit rating from either agency. California and Illinois, which are ranked worst and third worst, received the lowest ratings from both agencies.

The states that were well-managed also tended to have lower unemployment rates. Eight of the 10 states with the lowest unemployment rates ranked as the best-run states. California, Illinois, and Nevada — the states with the highest unemployment rates as of 2012 — were among the five worst-run states.

These are the best- and worst-run states in America.

1. North Dakota
> Debt per capita: $3,033 (20th lowest)
> Budget deficit: None
> Unemployment: 3.1% (the lowest)
> Median household income: $53,585 (19th highest)
> Pct. below poverty line: 11.2% (6th lowest)

North Dakota’s economic output has surged in the past few years, with GDP climbing 13.4% in 2012, well above the second-fastest growing state, Texas, whose GDP grew by 4.8% in 2012. The Peace Garden State has continued to reap the benefits of fracking in the oil-rich Bakken Shale formation, which accounted for about 90% of the state’s oil production in 2012. That year, nearly 10% of North Dakota’s total GDP was generated by the mining sector — which includes crude petroleum and natural gas extraction — more than five times the national rate. The state continued to have the nation’s lowest unemployment rate, at just 3.1% last year. Because of economic prosperity and the availability of jobs, North Dakota’s population grew the most in the country between 2010 and 2012, increasing by 3.7%. This may partly explain recent spikes in property values. Home values in North Dakota skyrocketed 33.4% between 2007 and 2012, by far the largest increase nationally.

2. Wyoming
> Debt per capita: $2,409 (13th lowest)
> Budget deficit: None
> Unemployment: 5.4% (7th lowest)
> Median household income: $54,901 (17th highest)
> Pct. below poverty line: 12.6% (13th lowest)

Wyoming was the nation’s largest producer of coal and the third-largest producer of natural gas in 2011. Mining accounted for 28% of the state’s GDP in 2012. Additionally, the Cowboy State has the nation’s best business tax climate, according to the Tax Foundation, due in part to the lack of corporate or individual income tax. Together, these factors may have contributed to the state’s healthy economy, which featured low unemployment and foreclosure rates as of 2012. The state’s population is also well-educated. Nearly 92% of adults over 25 years old had a high school diploma last year, better than all but a handful of states. Despite the many positive factors, the state’s GDP growth was weak last year, growing at just 0.2%.

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3. Iowa
> Debt per capita: $2,478 (15th lowest)
> Budget deficit: 2.5% (41st largest)
> Unemployment: 5.2% (tied-5th lowest)
> Median household income: $50,957 (23rd highest)
> Pct. below poverty line: 12.7% (14th lowest)

Agriculture and related industries accounted for 6.7% of Iowa’s GDP last year, six times the national rate. Like many well-run states, it has a perfect credit rating from both Standard & Poor’s and Moody’s. Additionally, while home values across the nation fell by more than 10% between 2007 and 2012, in Iowa they increased considerably — by 7.1% — over that time. Also, Iowa’s unemployment rate and underemployment rate — which includes the unemployed, discouraged workers, and those who work but want to work more — were both among the lowest in the nation last year, at 5.2% and 10%, respectively. Iowa’s budget shortfall in fiscal 2012 was under 3%, one of the smallest budget gaps in the country.

4. Nebraska
> Debt per capita: $1,277 (2nd lowest)
> Budget deficit: 4.8% (38th largest)
> Unemployment: 3.9% (2nd lowest)
> Median household income: $50,723 (25th highest)
> Pct. below poverty line: 13.0% (16th lowest)

Nebraska received strong scores for its fiscal management, with a perfect credit rating from Standard & Poor’s and extremely low debt as of fiscal 2011. The state’s pension plans were well-funded relative to most other states. Nebraska also faced a total budget shortfall of just 4.8% in fiscal 2012, one of the smaller deficits in the country. Nebraska’s unemployment rate was just 3.9% last year, less than any other state except for North Dakota. The Cornhusker State also had an underemployment rate of just 8.8%, the third lowest in the country. Nebraska also performed well in several measures that reflect quality of life. The state’s violent crime and poverty rates were lower than the national rates in 2012, while a higher percentage of residents had health insurance, and a high proportion of adults were high school graduates.

5. Utah
> Debt per capita: $2,577 (17th lowest)
> Budget deficit: 8.2% (32nd largest)
> Unemployment: 5.7% (tied-10th lowest)
> Median household income: $57,049 (13th highest)
> Pct. below poverty line: 12.8% (15th lowest)

By several measures, Utah had one of the stronger economies in the country in 2012. The state ranked fifth in exports per capita, and GDP growth was among the highest. The unemployment rate was just 5.7%, compared to a national rate of 8.1%. According to the Tax Foundation, Utah has one of the most business-friendly tax policies in the country. The state’s residents also have a relatively good quality of life. The state was among America’s safest last year, with just 205.8 violent crimes per 100,000 residents. Educational attainment was also strong, with 91% of residents over the age of 25 holding a high school diploma. The state received the top credit rating from both Standard & Poor’s and Moody’s, with the latter reasoning that Utah has responsible fiscal management and strong economic fundamentals.

6. Vermont
> Debt per capita: $5,566 (10th highest)
> Budget deficit: 14.2% (17th largest)
> Unemployment: 5.0% (4th lowest)
> Median household income: $52,977 (20th highest)
> Pct. below poverty line: 11.8% (10th lowest)

Vermont residents generally have a high quality of life, with very low crime and poverty rates last year. Despite a fairly high level of debt distributed across a small population as of fiscal 2011, the state’s credit rating is relatively strong. Vermont also had among the highest proportion of adults with a high school diploma in the nation last year. This may be due in part to the amount the state invests in education — Vermont spent $3,708 per capita on education in fiscal 2011, the most in the country. Education spending accounted for 40% of the state’s total expenditure that year, among the highest nationally. In 2011, the state passed Green Mountain Care, the first single-payer health care system in the U.S. The state plans to make the transition to the new system in 2017. Vermont already had the second-highest proportion of state residents covered by health insurance in 2012.

7. Minnesota
> Debt per capita: $2,421 (14th lowest)
> Budget deficit: 22.4% (6th largest)
> Unemployment: 5.6% (9th lowest)
> Median household income: $58,906 (9th highest)
> Pct. below poverty line: 11.4% (7th lowest)

Minnesota received top marks in a number of areas. More than 92% of Minnesota adults 25 and older were high school graduates as of 2012, the second-highest percentage in the nation. Additionally, just 8% of residents lacked health care coverage, trailing only three other states. The state’s poverty and violent crime rates were also among the nation’s lowest. The state’s economy was strong, as well, with a GDP growth rate of 3.5% in 2012, an unemployment rate of just 5.6%, and a median income of nearly $59,000, all of which were among the best in the nation. However, Minnesota receives low marks for its burdensome business tax climate, due in part to the state’s retroactive income tax hike on top earners. It also had one of the nation’s largest budget shortfalls for the 2012 fiscal year.

8. Alaska
> Debt per capita: $8,933 (2nd highest)
> Budget deficit: 15.9% (15th largest)
> Unemployment: 7.0% (22nd lowest)
> Median household income: $67,712 (3rd highest)
> Pct. below poverty line: 10.1% (2nd lowest)

As with several other highly ranked states, Alaska benefits from its massive natural resources. While mining, including oil and natural gas extraction, accounted for just 1.8% of the national GDP, these industries accounted for 21.3% of Alaska’s output, higher than any state but Wyoming. Taxes on the oil industry are one of the major factors in the state’s astronomical annual revenue — an estimated $20,646 per capita in fiscal 2011 — by far the most in the country. Alaska was one of just a handful of states to have no deficit for its 2012 budget. It also had the second-lowest poverty rate in the country, partly because permanent residents are entitled to a substantial oil revenue dividend. However, Alaska is not without shortcomings. Residents were among the most likely in the country to be without health insurance, and the state had the third-highest violent crime rate.

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9. South Dakota
> Debt per capita: $4,321 (14th highest)
> Budget deficit: 11.0% (24th largest)
> Unemployment: 4.4% (3rd lowest)
> Median household income: $48,362 (22nd lowest)
> Pct. below poverty line: 13.4% (18th lowest)

South Dakota has not experienced the same oil boom as North Dakota, and it effectively had flat GDP growth last year versus a 13.4% increase for its neighbor. Agriculture accounted for more than 10% of South Dakota’s total GDP in 2012, the most of any state in the nation. Last year, output from agriculture and related industries actually shrank, reducing total GDP growth by 2 percentage points. Despite this, the state’s economy is extremely strong by many measures. The median home value rose by 13.1% between 2007 and 2012, and just one in every 410 homes was in foreclosure last year, both among the best in the country. Also, the state’s 2012 unemployment rate was just 4.4%, better than all but two other states.

10. Texas
> Debt per capita: $1,513 (5th lowest)
> Budget deficit: 20.4% (7th largest)
> Unemployment: 6.8% (tied-17th lowest)
> Median household income: $50,740 (24th highest)
> Pct. below poverty line: 17.9% (tied-11th highest)

Texas’ GDP rose by 4.8% last year, the second-largest increase in the country, behind only North Dakota. Part of this growth came from the state’s robust energy sector. While Texas is the nation’s largest energy producer in the country by a wide margin, it also has a more balanced economy than other major oil and gas-producing states. The state exported more than $10,000 per capita in goods last year, the third most in the nation. Even with its relatively large economy — the state is in the top 15 for GDP per capita — Texas collected less revenue per resident than any other state. Texas also spent less per capita than most states, particularly on public welfare. The state has a perfect credit rating from both Standard & Poor’s and Moody’s, and had just $1,513 per capita in debt in fiscal 2011. Two negatives stand out for the state: Texas had the lowest rate of adults with a high school diploma, as well as the highest percentage of residents without health insurance coverage.

Click here to see the Worst States in America

11. Kansas
> Debt per capita: $2,406 (12th lowest)
> Budget deficit: 8.1% (33rd largest)
> Unemployment: 5.7% (tied-10th lowest)
> Median household income: $50,241 (25th lowest)
> Pct. below poverty line: 14.0% (23rd lowest)

Kansas had funded just over 56% of its pension obligations as of 2012, worse than all but five other states. Additionally, Moody’s has a negative outlook on the state’s credit rating, citing both the state’s underfunded pension, as well as its plans to eliminate income taxes. However, several components of the state’s economy performed well in 2012. The state’s 5.7% unemployment rate and its 10.2% underemployment rate were among the lowest in the nation. Also, Kansas faced a budget gap of just 8.1% in fiscal 2012, less than the state average of 15.5%. And while median home values declined nationally between 2007 and 2012, they rose 7.3% in Kansas. The state’s foreclosure rate was barely half the national rate.

12. Washington
> Debt per capita: $4,148 (16th highest)
> Budget deficit: 16.9% (13th largest)
> Unemployment: 8.2% (tied-17th highest)
> Median household income: $57,573 (12th highest)
> Pct. below poverty line: 13.5% (19th lowest)

Washington’s GDP rose by 3.6% in 2012, faster than all but three other states. Strong funding for its pension obligations also helped the state’s rating. Washington had funded more than 98% of its pension obligations in 2012, the second highest nationally. The state’s median household income and percent of households living below the poverty line were both better than the national average. The Tax Foundation gave Washington strong marks for its business climate, citing no individual income tax on earnings, dividends, or interest payments, although the state does tax a number of business transactions that are untaxed in many other states.

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13. Delaware
> Debt per capita: $6,429 (7th highest)
> Budget deficit: None
> Unemployment: 7.1% (tied-23rd lowest)
> Median household income: $58,415 (10th highest)
> Pct. below poverty line: 12.0% (12th lowest)

Despite high levels of debt as of fiscal 2011, Delaware holds a top credit score from both Standard & Poor’s and Moody’s. More than 88% of Delaware’s aggregate pension liabilities were funded as of last year, a higher percentage than all but five other states. The state was also among America’s wealthiest, with a median household income of $58,415 in 2012. Despite this, Delaware had one of the nation’s highest violent crime rates that year, with nearly 550 violent crimes per 100,000 residents. Crime is especially problematic in the city of Wilmington, where the number of shootings so far this year has already reached record levels.

14. Virginia
> Debt per capita: $3,285 (23rd lowest)
> Budget deficit: 12.2% (20th largest)
> Unemployment: 5.9% (13th lowest)
> Median household income: $61,741 (8th highest)
> Pct. below poverty line: 11.7% (9th lowest)

By many economic measures, Virginia is doing very well. The state had an unemployment rate of just 5.9% in 2012, compared to a national rate of 8.1%. Median household income was more than $10,000 higher than the national median. Virginia benefits from its close proximity to D.C. The Washington-Arlington-Alexandria metro area, which includes the northern part of the state, had a median income of more than $88,000 last year — more than $36,000 higher than the U.S. median. While the state’s pension funds were just over half funded on aggregate as of last year, Virginia’s general debt still receives a perfect credit rating from both Moody’s and Standard & Poor’s. The commonwealth also had the fourth-lowest violent crime rate in the country.

15. Montana
> Debt per capita: $4,290 (15th highest)
> Budget deficit: None
> Unemployment: 6.0% (14th lowest)
> Median household income: $45,076 (12th lowest)
> Pct. below poverty line: 15.5% (25th highest)

Montana was one of just eight states that did not need to close a budget shortfall going into fiscal 2012. State revenue came to just under $8,000 per resident as of fiscal 2011, and the Montana government spent roughly $7,100 per person that same year. However, the state still had a considerable amount of debt per capita, and Montana’s pension obligations were just 63.9% funded as of the end of 2012, compared to a 72.4% rate of pension funding across the nation. The state’s credit is rated just AA by Moody’s, putting it in the bottom half of the states. Montana’s poverty rate was roughly in line with the national rate in 2012. On the other hand, the state had the highest percentage of adults with a high school diploma, at 92.8%, compared to the 86.4% of adults nationwide.

16. Tennessee
> Debt per capita: $925 (the lowest)
> Budget deficit: n/a
> Unemployment: 8.0% (tied-19th highest)
> Median household income: $42,764 (7th lowest)
> Pct. below poverty line: 17.9% (tied-11th highest)

The Tennessee economy grew roughly 3.3% last year, better than the nation’s 2.5% growth. About a third of the increase in GDP came from growth in durable goods manufacturing, which includes the state’s growing auto industry. The state is home to auto plants owned by Nissan, General Motors, and Volkswagen. Tennessee had the smallest debt in the country relative to its size, at just $925 per resident as of fiscal 2011. Several negative factors, however, lowered the state’s ranking. Tennessee was the most crime ridden in the country last year, with a violent crime rate of 643.6 incidents per every 100,000 people. In the city of Nashville, the state’s capital and second largest city by population, the rate was nearly double that.

17. Oregon
> Debt per capita: $3,650 (22nd highest)
> Budget deficit: 24.0% (5th largest)
> Unemployment: 8.7% (11th highest)
> Median household income: $49,161 (23rd lowest)
> Pct. below poverty line: 17.2% (tied-15th highest)

Oregon has been among the fastest-growing states in the U.S. since 2010. And in 2012, it had the third-highest real GDP growth rate in the country, at 3.9%. Much of its economic growth was attributable to durable goods manufacturing, which includes computers and electronics. Worldwide leader in semiconductor chips, Intel Corp., is the largest private sector employer. Despite the state’s growth, Oregon’s poverty rate of 17.2% was above the national rate of 15.9%, and more than one in five households in Oregon depended on food stamps last year, more than any other state. According to Stateline, recent cuts to SNAP, better known as the food stamp program, will lead to fewer benefits for more than 300,000 children in Oregon.

18. Massachusetts
> Debt per capita: $11,309 (the highest)
> Budget deficit: 5.5% (37th largest)
> Unemployment: 6.7% (16th lowest)
> Median household income: $65,339 (6th highest)
> Pct. below poverty line: 11.9% (11th lowest)

Massachusetts’ tends to spend a great deal on its population. In particular, it spent about $640 more per person on public welfare than the average state. It had more than $74 billion in debt in fiscal 2011, or 131% of the state’s revenue. Massachusetts had, by far, the most debt of any state. State debt across the 50 states accounted for about 50% of revenue, on average. A positive factor for the state is its residents’ health coverage. In part because of the comprehensive health insurance program implemented by former Massachusetts Governor Mitt Romney in 2006, residents easily have the highest coverage rate in the country. Only 3.9% of the population did not have health insurance in 2012, compared to less than 15% nationwide.

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19. Indiana
> Debt per capita: $3,405 (25th highest)
> Budget deficit: None
> Unemployment: 8.4% (tied-14th highest)
> Median household income: $46,974 (19th lowest)
> Pct. below poverty line: 15.6% (24th highest)

Indiana is part of a heavily industrial region of the U.S. that, due to declining economic activity, has come to be known as the “rust belt.” In Indiana, 28% of GDP came from the manufacturing sector in 2012, the highest rate in the country and more than double the national figure. The state’s exports were higher than the national average last year as well, at $5,259 per capita. But, according to Moody’s, the state’s exposure to manufacturing poses a challenge is exactly the challenge it is facing. Indiana still receives perfect ratings from both Moody’s and Standard & Poor’s. As reasons for its rating, Moody’s cited the state’s “conservative fiscal management,” and its “willingness to make budget adjustments as necessary in response to revenue declines.” Indiana also has one of the country’s most business-friendly tax climates, according to the Tax Foundation.

20. Idaho
> Debt per capita: $2,489 (16th lowest)
> Budget deficit: 3.6% (39th largest)
> Unemployment: 7.1% (tied-23rd lowest)
> Median household income: $45,489 (15th lowest)
> Pct. below poverty line: 15.9% (tied-22nd highest)

Idaho’s government has relatively conservative spending habits, if the last few years are any indication. The state spent just $5,510 per resident in fiscal 2011, putting it just outside of the 10 lowest spenders. Revenue was roughly $6,600 per resident that year. The state had just a 3.6% budget shortfall as of fiscal 2012, one of the smallest in the country. As of the end of that year, the state had funded nearly 85% of its aggregate pension obligations. While Idaho may be doing a better-than-average job managing limited resources, the state’s economy appears to be struggling. Idaho’s GDP grew just 0.4% last year, worse than all but a handful of states. The state was one of the hardest hit in the region during the housing price collapse, the effects of which could be still seen in the high foreclosure rate last year.

21. Wisconsin
> Debt per capita: $4,013 (18th highest)
> Budget deficit: 11.3% (22nd largest)
> Unemployment: 6.9% (tied-19th lowest)
> Median household income: $51,059 (22nd highest)
> Pct. below poverty line: 13.2% (17th lowest)

Wisconsin led the nation in funding pension obligations, with nearly 100% of its liabilities funded as of 2012. Several mechanisms help keep the program in good shape, according to Institutional Investor. Employee contributions are required and payouts are tied to the performance of the Wisconsin Retirement System’s portfolio, instead of being fixed. The state also boasts a population that is well educated and largely insured. More than 90% of adults aged 25 and older had a high school diploma as of 2012, and just 9% of residents lacked health care coverage — less than all but six states. By a number of measures, however, Wisconsin ranked below average. The state’s real GDP growth in 2012 was only 1.5%, below the national growth rate of 2.5%. One in every 69 homes were in foreclosure in 2012, one of the highest rates in the country.

22. Hawaii
> Debt per capita: $5,780 (9th highest)
> Budget deficit: 9.6% (27th largest)
> Unemployment: 5.8% (12th lowest)
> Median household income: $66,259 (5th highest)
> Pct. below poverty line: 11.6% (8th lowest)

Median household income in Hawaii rose from $63,218 in 2011 to $66,259 last year. Hawaii’s unemployment rate was just 5.8% in 2012, versus a national rate of 8.1%. Additionally, just 6.9% of the state’s population did not have health insurance last year, among the lowest rates in the nation. This low rate is likely in part the result of the 1974 Hawaii Prepaid Health Care Act, which has required employers to provide coverage for all employees working at least 20 hours per week and earning $629 or more per month. Hawaii also had $5,780 in debt per capita as of fiscal 2011, ninth-worst in the nation. Hawaii’s government sector accounted for over 24% of state GDP last year, the most in the nation. Explaining its relatively low Aa2 rating, Moody’s notes that the state’s high debt and large government sector employment are both challenges the state faces.

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23. West Virginia
> Debt per capita: $3,993 (19th highest)
> Budget deficit: None
> Unemployment: 7.3% (tied-22nd highest)
> Median household income: $40,196 (3rd lowest)
> Pct. below poverty line: 17.8% (13th highest)

Despite having one of the nation’s lowest median household incomes and a high school graduation rate that was lower than all but seven states, West Virginia still ranked better overall on our list than more than half of all states. Between 2007 and 2012, home values in West Virginia rose by 4.6%, despite declining nationally by 11.5%. Also, just one in 646 homes was in foreclosure last year, among the lowest rates in the nation. The state’s economy was also relatively strong, with GDP growing by 3.3% in 2012, among the highest increases in the nation. A major contributor to this growth was mining, which accounted for 13% of output last year. Although Appalachian coal mining has declined considerably in recent years and faces a bleak outlook, a recent state commerce report noted that natural gas jobs rose 20% last year.

24. Maryland
> Debt per capita: $4,348 (13th highest)
> Budget deficit: 9.5% (28th largest)
> Unemployment: 6.8% (tied-17th lowest)
> Median household income: $71,122 (the highest)
> Pct. below poverty line: 10.3% (3rd lowest)

Maryland’s population is the wealthiest in the country. The state had a median household income of $71,122 last year, nearly $20,000 higher than the U.S. median. Also, just 10.3% of the population lived below the poverty line. The state had a relatively large amount of debt, at approximately 60% of annual revenue as of fiscal 2011, compared to 50% nationwide. Still, Maryland maintains a perfect credit rating from both Moody’s and Standard & Poor’s. Moody’s credited the wealthy tax base as a factor for its rating, as well as the state’s “history of strong financial management.” One negative factor is the state’s high violent crime rate, which was one of the highest in the country last year.

25. New Hampshire
> Debt per capita: $6,414 (8th highest)
> Budget deficit: 20.0% (8th largest)
> Unemployment: 5.5% (8th lowest)
> Median household income: $63,280 (7th highest)
> Pct. below poverty line: 10.0% (the lowest)

By many measures, New Hampshire’s population has a higher quality of living than most of the country. The state had among the highest proportions of adults with a high school diploma and one of the lowest violent crime rates in the country last year. Also, just 10% of the population lived below the poverty line in 2012, lower than any other state. The state’s financial track record, however, is not as impressive. The state’s government debt was $6,414 per person as of fiscal 2011, making it one of only eight states with more than $6,000 in debt per capita. As of the end of 2012, the state had funded just 56.2% of its pension obligations, one of the lowest rates. The state had to close a 2012 budget shortfall amounting to 20% of its total budget, among the largest budget gaps in the country.

26. Ohio
> Debt per capita: $2,680 (18th lowest)
> Budget deficit: 10.8% (25th largest)
> Unemployment: 7.2% (25th lowest)
> Median household income: $46,829 (17th lowest)
> Pct. below poverty line: 16.3% (20th highest)

Ohio is one of the nation’s largest manufacturing states, with the industry accounting for 17% of state GDP last year, compared to 12% of national GDP. Although the industry has contracted and jobs were lost over the past 10 years, there have been signs of recovery recently. At a recent speech in Ohio, President Barack Obama touted the auto industry bailout as having saved jobs. As of last year, Ohio’s unemployment rate was 7.2%, below the nationwide rate of 8.1%. Yet the state still had a number of problems. One in every 57 housing units entered foreclosure that year, one of the highest rates in the country. The state also has been criticized for its tax code, which includes a gross receipts tax — a tax on individual business transactions that can be assessed multiple times during the production process — that the Tax Foundation calls “easily the worst part of Ohio’s tax code.”

27. Pennsylvania
> Debt per capita: $3,556 (23rd highest)
> Budget deficit: 13.5% (19th largest)
> Unemployment: 7.9% (21st highest)
> Median household income: $51,230 (21st highest)
> Pct. below poverty line: 13.7% (tied-20th lowest)

Pennsylvania is fairly average by most categories. This was the case for the state’s fiscal track record. One outlier was the state’s pension obligations, which were poorly funded at 63.9% The state also had relatively poor credit ratings from both Moody’s and Standard & Poor’s. According to Moody’s, increases in pension contributions will limit the state’s spending flexibility for the next several years. Yet the state also excels in several measures. Between 2007 and 2012, home values in Pennsylvania rose nearly 6%, versus an 11.5% drop nationwide. Further, more than 90% of residents had health care coverage as of 2012, among the highest rates in the U.S.

28. Missouri
> Debt per capita: $3,445 (24th highest)
> Budget deficit: 8.8% (30th largest)
> Unemployment: 6.9% (tied-19th lowest)
> Median household income: $45,321 (14th lowest)
> Pct. below poverty line: 16.2% (21st highest)

Missouri’s finances appear to be in decent shape. The state faced a relatively small deficit in fiscal 2012, and its pension obligations were more than three-quarters funded. The Show-Me State is also one of 13 states with a perfect credit rating from both Standard & Poor’s and Moody’s. Missouri’s GDP growth, however, has lagged that of the U.S. in each of the last four years. The state’s exports were also among the lowest in 2012, at just $2,310 per resident. Possibly as a result of the state’s stagnant economy, Missouri’s revenue per capita was just $6,423, more than $800 per resident less than the national average. The state does well by some economic measures, however. Unemployment rate last year was just 6.9%, versus 8.1% nationally. Just one in every 113 Missouri homes was in foreclosure last year, compared to one of every 72 nationwide.

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29. North Carolina
> Debt per capita: $1,931 (8th lowest)
> Budget deficit: 12.2% (20th largest)
> Unemployment: 9.5% (tied-4th highest)
> Median household income: $45,150 (13th lowest)
> Pct. below poverty line: 18.0% (10th highest)

As of 2012, 18% of North Carolina residents lived below the poverty line, among the highest in the nation. Additionally, the median household income in the state that year was $6,000 lower than the national median income. North Carolina’s fiscal track record, however, is quite strong, and the state carries perfect credit ratings from both Moody’s and Standard & Poor’s. North Carolina had funded nearly 94% of its pension obligations as of 2012, trailing just two other states, and had comparatively little debt as of fiscal 2011. Recent tax reforms in the state have been met with mixed responses. Some critics claim the reforms overwhelmingly cut needed government services and disproportionately benefit the wealthy, while others argue the plan to cut income taxes will be beneficial to economic growth and employment.

30. Maine
> Debt per capita: $4,447 (12th highest)
> Budget deficit: 16.6% (14th largest)
> Unemployment: 7.3% (tied-22nd highest)
> Median household income: $46,709 (16th lowest)
> Pct. below poverty line: 14.7% (tied-24th lowest)

By some measures, Maine has a relatively weak economy. While the national economy grew by 2.5% last year, the state’s GDP grew by just 0.5%. The Pine Tree state exported $2,300 in goods per resident that year, compared to the $4,928 exported nationwide per person. On the positive side, the state’s population is well off. Maine had the lowest violent crime rate in the country last year, at just 123 incidents per 100,000 residents. Also, the state’s adult residents were among the most likely in the country to have a high school diploma. The state’s poverty rate was below the national average. Relative to the size of its population, few states spent more on public welfare in fiscal 2011 than Maine. This spending amounted to nearly a third of the state’s budget. The average state spent about a quarter of its budget on public welfare programs.

31. Colorado
> Debt per capita: $3,214 (22nd lowest)
> Budget deficit: 6.3% (36th largest)
> Unemployment: 8.0% (tied-19th highest)
> Median household income: $56,765 (14th highest)
> Pct. below poverty line: 13.7% (tied-20th lowest)

Colorado was one of the nation’s weakest exporters in 2012, with only $1,574 worth of goods exported per capita. The average state in 2012 exported close to $5,000 per person. Colorado was among the states spending the least on public welfare programs as of fiscal 2011 — one of three to spend under $1,000 per capita. The poverty level last year, however, was better than the national rate, at under 14%. Colorado’s education spending per capita was slightly below the U.S. average in fiscal 2011. Spending may have been low because the state did not have all that much money to spend. As of fiscal 2011, the Centennial State raised just $5,763 in total revenue per resident, among lowest figures. Governor John Hickenlooper hopes to reverse the state’s poor education funding in next year’s budget, which proposes increases in per-pupil spending. The governor’s efforts signal the reversal of a multi-year trend; Colorado’s per-pupil spending is down by more than 7% compared with education spending in fiscal 2008, according to the Center on Budget and Policy Priorities.

32. Arkansas
> Debt per capita: $1,280 (3rd lowest)
> Budget deficit: None
> Unemployment: 7.3% (tied-22nd highest)
> Median household income: $40,112 (2nd lowest)
> Pct. below poverty line: 19.8% (4th highest)

By several measures, Arkansas is a fiscally sound state. Government debt as of fiscal 2011 was just 16.5% of annual state revenue, the lowest in the country and much better than the 50% average across all states. The state was also one of just eight to not have any budget gap to close in fiscal 2012. And, relative to its total spending, Arkansas actually spent more on education than any other state. However, Arkansas has a very poor population, with the second lowest median household income of $40,112 in 2012, as well as one of the lowest proportion of adults with a high school diploma or more.

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33. Oklahoma
> Debt per capita: $2,716 (19th lowest)
> Budget deficit: 9.0% (29th largest)
> Unemployment: 5.2% (tied-5th lowest)
> Median household income: $44,312 (10th lowest)
> Pct. below poverty line: 17.2% (tied-15th highest)

By many critical measures of well-being, Oklahoma performs quite poorly. More than 18% of residents did not have health care coverage last year, among the worst in the nation. Additionally, the state’s poverty and violent crime rates were also quite high and median household income was among the 10 lowest in the nation. However, the Sooner State does well by several measures. Between 2007 and 2012, home values rose by 11%, more than all but two other states. Oklahoma’s unemployment rate was fifth lowest in the nation last year, at just 5.2%. Although the state is among the nation’s smallest exporters per capita, it is a major energy producer of both natural gas and oil.

34. Georgia
> Debt per capita: $1,373 (4th lowest)
> Budget deficit: 7.6% (34th largest)
> Unemployment: 9.0% (9th highest)
> Median household income: $47,209 (20th lowest)
> Pct. below poverty line: 19.2% (6th highest)

Georgia exhibits strong fiscal management. The state had among the lowest debt burdens per resident in fiscal 2011 at roughly $1,400, whereas some states carried five times that amount. Additionally, the state had funded nearly 82% of its aggregate pension liabilities as of last year. But the state also had one of the nation’s highest poverty rates in 2012 at over 19%, as well as foreclosure and unemployment rates that ranked among the nation’s worst. Similarly, comparatively few residents had health insurance coverage. Despite that, Governor Nathan Deal has rejected Medicaid expansion and chose not to set up a state-run insurance exchange, two provisions of the Affordable Care Act.

35. Michigan
> Debt per capita: $3,136 (21st lowest)
> Budget deficit: 3.5% (40th largest)
> Unemployment: 9.1% (tied-7th highest)
> Median household income: $46,859 (18th lowest)
> Pct. below poverty line: 17.4% (14th highest)

During the recession, it appeared that no state would be hit harder than Michigan. However, a number of factors have since buoyed the state’s fortunes. In 2009, the state had the highest average unemployment rate in the country. By 2012, while unemployment was still high, six states had higher rates. Michigan’s GDP, which contracted by a record 9.1% in 2009, provides further evidence of the state’s recovery. In the next two years, the state’s GDP growth rate was among the highest in the country. Last year, it grew slightly less than the national rate. Despite its improvement, the state still struggles. Standard & Poor’s rates the Michigan’s credit as among the worst of any state. Characterized as unavoidable by city lawyers earlier this year, Detroit filed for bankruptcy this summer.

36. Mississippi
> Debt per capita: $2,276 (10th lowest)
> Budget deficit: 13.7% (18th largest)
> Unemployment: 9.2% (6th highest)
> Median household income: $37,095 (the lowest)
> Pct. below poverty line: 24.2% (the highest)

Nearly one in every four Mississippi residents lived in poverty last year, the worst rate in the nation. The state’s unemployment was also among the highest in 2012, and median household income was among the nation’s lowest. Property values improved between 2007 and 2012, but relative to other states, median home values went from second lowest in 2007 to lowest in 2012. However the state has been responsible about borrowing, with debt per capita totaling just $2,276 as of fiscal 2011, tenth lowest among the 50 states.

37. Florida
> Debt per capita: $2,294 (11th lowest)
> Budget deficit: 15.8% (16th largest)
> Unemployment: 8.6% (12th highest)
> Median household income: $45,040 (11th lowest)
> Pct. below poverty line: 17.1% (17th highest)

Florida was rocked by the housing crisis as foreclosures piled up, home prices plunged, and construction went unfinished. Home values plummeted by nearly 36% between 2007 and 2012. One in every 32 homes in the state was in foreclosure last year, the highest in the country. Florida also had one of the nation’s highest crime rates, at 487 violent crimes per 100,000 residents. Meanwhile, 20% of the population lacked health coverage, more than all but three other states. The state received accolades from the Tax Foundation, however, for its business-friendly tax climate. Recently, Governor Rick Scott pledged to cut more than $500 million in taxes in his next budget. Scott also touted his own performance in cutting Florida’s deficit. Florida had to close a $3.7 billion deficit, equal to 15.8% of its budget, in fiscal 2012, according to the CBPP.

38. Kentucky
> Debt per capita: $3,332 (25th lowest)
> Budget deficit: 10.5% (26th largest)
> Unemployment: 8.2% (tied-17th highest)
> Median household income: $41,724 (5th lowest)
> Pct. below poverty line: 19.4% (5th highest)

While Kentucky was not heavily in debt, less than half of the state’s pension obligations were funded, well below the national average. Moody’s and Standard & Poor’s both give the state’s credit a relatively low rating, with Standard & Poor’s grading it AA- with a negative outlook, worse than all but a handful of states. Kentucky is one of the poorest states in the country, with a median income of just $41,724, and a poverty rate of more than 19%, both fifth worst in the U.S. Only 83.8% of the adult population had a high school diploma last year, also fifth worst in the country. Despite facing these problems, Kentucky wasn’t even in the top 15 for education or welfare spending in fiscal 2011, relative to the size of its budget.

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39. New York
> Debt per capita: $6,944 (6th highest)
> Budget deficit: 18.2% (10th largest)
> Unemployment: 8.5% (13th highest)
> Median household income: $56,448 (15th highest)
> Pct. below poverty line: 15.9% (tied-22nd highest)

New York’s debt of nearly $7,000 per resident as of fiscal 2011 was among the highest of any state in the nation. Despite the significant presence of major industries in New York, the state was rated by the Tax Foundation as having the worst business tax climate in the nation. The group gave poor ratings to New York’s individual income tax, property tax, and unemployment insurance tax policies. Not all is bad in the Empire State, however. The state’s pension obligations were more than 90% funded, and the state’s foreclosure rate is 10th lowest in the country.

40. Alabama
> Debt per capita: $1,891 (7th lowest)
> Budget deficit: 15.9% (15th largest)
> Unemployment: 7.3% (tied-22nd highest)
> Median household income: $41,574 (4th lowest)
> Pct. below poverty line: 19.0% (7th highest)

Alabama was among the states spending the least on public welfare programs in fiscal 2011, but not because its residents were wealthy. Last year, nearly one in five residents lived below the poverty line. In fiscal 2011, 39% of Alabama’s spending went to education, or $2,277 per resident, among the highest levels nationwide. The percent of adults with a high school diploma or better, however, was one of the worst in 2012. The state’s GDP growth rate was also in the bottom 15 in three of the last four years. Last year, state GDP increased by just 1.2%, less than half the national growth rate. Unemployment in the Birmingham metropolitan area, Alabama’s most populous region, improved considerably between 2011 and 2012, dropping from 7.9% to 6.4%. This mirrored the trend statewide, where unemployment dropped from 8.7% in 2011 to 7.3% in 2012.

41. Connecticut
> Debt per capita: $8,531 (4th highest)
> Budget deficit: 17.1% (12th largest)
> Unemployment: 8.4% (tied-14th highest)
> Median household income: $67,276 (4th highest)
> Pct. below poverty line: 10.7% (4th lowest)

Connecticut’s economy was the only one in the country to contract in 2012. The state also had the 4th highest debt per capita in fiscal 2011. Moody’s and Standard & Poor’s rate the state’s credit as relatively poor. This may be due to the state’s poorly-funded pension. The state’s pension obligations were less than half funded as of 2012. Connecticut’s crime rate was better than the national rate, although it varied considerably across the state. In Stamford, the violent crime rate was under 300 incidents per every 100,000 people. In New Haven, on the other hand, it was close to 1,500 — among the highest rates for any metro area.

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42. South Carolina
> Debt per capita: $3,293 (24th lowest)
> Budget deficit: 11.1% (23rd largest)
> Unemployment: 9.1% (tied-7th highest)
> Median household income: $43,107 (9th lowest)
> Pct. below poverty line: 18.3% (9th highest)

South Carolina ranks poorly in several measures. One in every 60 South Carolina homes were in foreclosure in 2012, and the median household income was just $43,107, both among the worst figures nationwide. The state’s poverty and violent crime rates were also among the highest in the country, and its property crime rate was the highest. South Carolina’s unemployment rate was more than 9% last year, among the worst in the nation. Several of the state’s metropolitan areas, including Myrtle Beach, Sumter, and Florence, had unemployment rates of 10% or greater in 2012. South Carolina is currently pitching Boeing to move jobs there, with Governor Nikki Haley touting her opposition to unions.

43. New Jersey
> Debt per capita: $7,265 (5th highest)
> Budget deficit: 37.5% (the largest)
> Unemployment: 9.5% (tied-4th highest)
> Median household income: $69,667 (2nd highest)
> Pct. below poverty line: 10.8% (5th lowest)

New Jersey’s population is relatively wealthy. The state’s median household income in 2012 was just under $70,000, the second highest in the U.S. Just 10.8% of the population lived below the poverty line that year, among the lowest in the country. Unfortunately, the state ranks poorly by most other measures. While the national job market improved in 2012, New Jersey’s unemployment remained high. Compared to the state’s 2011 unemployment rate of 9.4%, which was 14th worst in the country that year, the 2012 unemployment rate rose to 9.5%, and tied for fourth-worst in the U.S. Also, the state needed to close a deficit of nearly 38% of its total budget in fiscal 2012 — the largest budget gap that year. State debt amounted to $7,265 per resident in fiscal 2011, nearly double the average across all states. New Jersey’s GDP growth has been among the bottom 15 states in each of the past four years.

44. Louisiana
> Debt per capita: $4,045 (17th highest)
> Budget deficit: 25.1% (4th largest)
> Unemployment: 6.4% (15th lowest)
> Median household income: $42,944 (8th lowest)
> Pct. below poverty line: 19.9% (3rd highest)

While home values nationwide fell by more than 11% between 2007 and 2012, the median Louisiana home value rose by 10% during that time, one of the largest increases nationally. Still, even with a relatively healthy housing market, Louisiana’s population has other serious problems. As of 2012, just 83% of the state’s adults had a high school diploma and more than 16.9% of the state’s population did not have health insurance coverage, both among the worst in the country. There were nearly 500 violent crimes per 100,000 residents in 2012, making the state one of the most dangerous. Nearly under one in every five residents lived below the poverty line, worse than all but two states. The state’s finances are also in bad shape. Just over 55% of the state’s pension obligations were funded in 2012, fourth-worst in the country. And the state had to close a budget gap of more than 25% going into fiscal 2012. The average gap across the states was 15.5% that year.

45. Arizona
> Debt per capita: $2,197 (9th lowest)
> Budget deficit: 18.2% (10th largest)
> Unemployment: 8.3% (16th highest)
> Median household income: $47,826 (21st lowest)
> Pct. below poverty line: 18.7% (8th highest)

Only Nevada suffered more than Arizona from the housing crisis. The state’s median home value fell by more than 36% between 2007 and 2012. More than one in six residents lived in poverty last year, which may help explain the state’s relatively high spending on social programs. Twenty-nine percent of all spending in fiscal 2011 was on public welfare programs, one of the highest proportions in the country. Meanwhile, Arizona’s revenue per state resident was $2,197 in fiscal 2011, among the lowest. Although many of its financials, including debt and pension funding, are better than the average state, Arizona had an 18.2% deficit for fiscal 2012, one of the highest in the country. The state’s credit ratings are among the worst in the country.

46. Nevada
> Debt per capita: $1,548 (6th lowest)
> Budget deficit: 37.0% (2nd largest)
> Unemployment: 11.1% (the highest)
> Median household income: $49,760 (24th lowest)
> Pct. below poverty line: 16.4% (19th highest)

Nevada was arguably the hardest hit state during the collapse of the housing bubble. Home values fell by more than 50% between 2007 and 2012, the largest decline in the country. And years after it started, Nevada is still reeling from the housing crisis. The state had one of the highest foreclosure rates in the country last year, at one in every 37 homes. The 2012 unemployment rate of 11.1% was the worst in the country. The state’s violent crime rate of 607.6 incidents for every 100,000 residents was worse than all but one other state. The state also suffers from low health insurance coverage. More than 22% of the population was without health coverage in 2012, worse than any other state except for Texas. This rate may improve in 2013. The state opted to provide its own health insurance exchange site rather than rely on the widely criticized national exchange site, healthcare.gov. According to the Las Vegas Sun, the state’s health care exchange site has been functioning relatively smoothly and hasn’t received the same kind of criticism as the national site.

47. Rhode Island
> Debt per capita: $8,721 (3rd highest)
> Budget deficit: 6.9% (35th largest)
> Unemployment: 10.4% (3rd highest)
> Median household income: $54,554 (18th highest)
> Pct. below poverty line: 13.7% (tied-20th lowest)

Rhode Island had more debt per resident than any other state except for Alaska and Massachusetts as of fiscal 2011. Although its budget shortfall was relatively small in fiscal 2012, the state currently faces unplanned expenses and may have to revise its budget, according to The Providence Journal. Moody’s cited the state’s eight consecutive years of budget gaps as part of its justification for its relatively poor credit rating. In an attempt to improve funding levels, the state reformed its pension program in 2011, turning its pensions into hybrids with 401(k)-like features, as well as suspending both cost-of-living adjustments and benefit increases. Still, as of last year, the state had funded just over 58% of its pension obligations, compared to a 72.4% average across all states.

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48. Illinois
> Debt per capita: $5,041 (11th highest)
> Budget deficit: 18.5% (9th largest)
> Unemployment: 8.9% (10th highest)
> Median household income: $55,137 (16th highest)
> Pct. below poverty line: 14.7% (tied-24th lowest)

Illinois has the worst credit rating in the U.S., having received the lowest rating of any state from both Standard & Poor’s and Moody’s. Explaining its reasoning, Moody’s pointed to the state’s underfunded pension and ongoing weak fiscal practices such as bill payment delays. Only 40.4% of the state’s pension obligations were funded in 2012, the worst rate in the nation. Illinois also had the fourth-largest debt in the country at the end of fiscal 2011 at nearly $65 billion. The state faced high foreclosure and unemployment rates in 2012, both among the worst in the country.

49. New Mexico
> Debt per capita: $3,914 (21st highest)
> Budget deficit: 8.3% (31st largest)
> Unemployment: 6.9% (tied-19th lowest)
> Median household income: $42,558 (6th lowest)
> Pct. below poverty line: 20.8% (2nd highest)

New Mexico ranked this year as the second worst-run state in the country, scoring better than California by only a small margin. One measure that helped put it above California was its credit rating. Standard & Poor’s rates the state AA+, and Moody’s gives it a perfect Aaa rating. The state’s debt load relative to its size was average, and its budget shortfall of 8.3% for going into fiscal 2012 was better than many states. Outside of fiscal management, however, New Mexico performed poorly in several areas in several areas. The state was among the worst 10 nationwide for violent crime, high school graduation rates among adults, and health insurance coverage. More than one in five residents lived below the poverty line in 2012, worse than all states but Mississippi. Last year, state GDP grew by just 0.2%, worse than all but a handful of states.

50. California
> Debt per capita: $3,990 (20th highest)
> Budget deficit: 27.8% (3rd largest)
> Unemployment: 10.5% (2nd highest)
> Median household income: $58,328 (11th highest)
> Pct. below poverty line: 17.0% (18th highest)

For the third year in a row, California is the worst-run state in America. California faced a nearly $24 billion in budget shortfall in fiscal 2012, including a mid-year shortfall of $930 million and $8.2 billion carried over from the year before. California carries an A credit rating from Standard & Poor’s, and an A1 from Moody’s — both worse than any other state except for Illinois. Explaining its rating, Moody’s pointed to the state’s history of one-time solutions to resolve its budgetary gaps. It also noted the state’s “highly volatile revenue structure,” due to its over reliance on wealthy taxpayers. The Golden State was also among the worst states in the nation for educational attainment, health coverage, and unemployment.

Methodology

24/7 Wall St. considered data from a number of sources, including Standard & Poor’s, Moody’s Investors Service the Bureau of Labor and Statistics (BLS), the U.S. Census Bureau, the Tax Foundation, RealtyTrac, The Federal Bureau of Investigation, the Bureau of Economic Analysis (BEA), and the Center on Budget Policies and Priorities (CBPP).

Unemployment data was taken from the U.S. Bureau of Labor Statistics. Credit ratings were from ratings agencies Standard & Poor’s and Moody’s Investors Service. We relied on the FBI’s Uniform Crime Report for violent crime rate by state. RealtyTrac provided foreclosure rates. Pension figures are from Morningstar.

A significant amount of the data we used came from the U.S. Census Bureau’s American Community Survey. Data from ACS included percentage of residents below the poverty line, high school completion rates for residents 25 and older, median household income, the percentage of the population without health insurance and median home values from both 2007 and 2012.

Once we reviewed the sources and compiled the final metrics, we ranked each state based on its performance in all the categories. Most figures are for 2012. Debt per capita, obtained from the Tax Foundation, and state budgetary data, which came from the U.S. Census Bureau, are for fiscal year 2011. Figures from the CBPP are for the fiscal year 2012. Credit ratings and the Tax Foundation’s rankings for business tax climate are based on the most recently available publications.

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