In the last year, Indiana's elected leaders have positioned the state for economic leadership in the Midwest by passing pro-growth policies that focus on lower taxes and less regulation. While other nearby states have seen their economies swoon as anti-competitive, anti-market forces have repeatedly won political battles, Indiana's voters have supported political leaders with jobs-friendly tax cutting agendas and investment-inviting deregulation proposals. The citizens of the state are now reaping the benefits.

New jobs are keeping down unemployment. At 4.9 percent, down from 5.5 percent just a year ago, unemployment in Indiana is lower than every other surrounding state. This is compared to 7.2 percent in Michigan, 6 percent in Kentucky, 5.1 percent in Illinois and 5.5 percent in Ohio.

But good unemployment news is just the beginning of the story. In 2005 per capita income in Indiana was higher than any neighboring state. This is a direct result of the state's welcoming business tax climate. For 2006, Indiana ranked 11th in the Tax Foundation's "state business tax climate index." This index measures the tax burden of doing business in the state, a crucial thermometer of potential economic growth. This ranking was also considerably higher than every neighboring state, especially in contrast to Kentucky's position at 44th and repeat-offender Ohio at 47th.

Indiana's economy is healthy and growing. One reliable gauge of this growth is state tax revenue, so it's no surprise that in April tax receipts were $200 million more than previously projected. What may be surprising to some is that Indiana's low 3.4 percent flat rate income tax is the nation's third lowest state levy.

Still, in many cases steady tax revenues simply become an excuse for unbridled government spending--which is why Indiana should be applauded for working to trim state spending, eliminate waste and corruption and slow the growth of government. Governor Daniel's efforts early efforts on this front are beginning to pay off. Last year the state's Office of Management and Budget trimmed $150 million in unnecessary spending from the state budget. By doing such things as buying ballpoint pens in bulk instead of department by department, Governor Daniels' budget slows state spending growth from 6 percent this past decade to 2.6 percent in FY 2006 and 1.4 percent in FY 2007.

This spring the Indiana legislature also revamped outdated telecom regulations with a comprehensive reform law. This law puts Indiana among the first states in the nation to enact sensible telecom reform that encourages direct cable TV competition.

The groundbreaking cable TV competition component of the law strips away old regulations that hampered competition in the cable TV market and opens the door to new service from traditional phone companies. Indiana can now look forward to increased investment in broadband video and phone services and lower prices for consumers as companies go head-to-head to win customers in a newly competitive marketplace. One study estimates that competition in television will "save existing Indiana cable subscribers between $131 million and $262 million annually."

This reform is already paying dividends. AT&T recently announced that it would be bringing high-speed Internet access to 33 small Indiana communities--31 more than it had planned had the state not passed the telecom deregulation. Rural broadband deployment holds the prospect of economic growth, as companies looking to invest in new jobs see broadband connectivity as a major infrastructure prerequisite.

Not only will Indiana's new common sense deregulation spur investment, it will provide crucial jobs for Hoosiers and keep the state's low unemployment rate down. Two studies on the recent telecom reform laws found that they will ultimately create 20,000 new jobs as telecommunications companies invest tens of millions of dollars to stay ahead of the competition across the state.

In recent years Indiana has taken great strides towards creating a stable economy in the midst of tumultuous downturns in Midwest manufacturing and uncertainty about the economic future. As Indiana restores a sense of accountability and fiscal responsibility to state government, maintains a low-tax environment, and jettisons outdated regulations to lure new investment, the state will flourish with the promise of growth and opportunity.

All of this is coming not a moment too soon. As the nation's and the world's economy evolves more quickly with each passing month, leaders who choose to follow last year's playbook will find themselves falling behind with each step. Fortunately for Hoosiers, Indiana is making bold decisions to stay ahead of the pack and ensure Indiana's future prosperity.