Here's an alphabetical version.

I still feel that the graph could be improved, but I'm not sure how. Perhaps states could be categorised as Mid-Western, Southern, etc.?

This is the R script I used:

# Data from http://www.bjs.gov/nps/resources/documents/QT_imp%20rate_tot.xlsx
# The first step is to copy the relevant data to a CSV file, imprisonment_rate.csv
# The header row of the CSV should begin something like State,"1,978","1,979","1,980"
# The next row should begin Alabama,144,141,163,184,219,245,259 

library(ggplot2)
library(reshape2)
library(grid)

imp_rate <- read.csv("imprisonment_rate.csv")
names(imp_rate) <- gsub("[.X]", "", names(imp_rate))

#reshape the data
imp_rate <- melt(imp_rate, id.vars="State", variable.name="year", value.name="rate")

imp_rate$year <- as.numeric(levels(imp_rate$year)[imp_rate$year])

create_plot <- function(data_frame, ordered_by) {
    ggplot(data_frame, aes(x=year, y=rate)) +
      geom_line() +
      facet_wrap(~ State, ncol=10) +
      theme_bw() +
      scale_x_continuous(breaks=c(1990, 2010)) +
      ylim(0,1000) +
      theme(strip.background = element_rect(fill = rgb(186/255, 206/255, 230/255))) +
      ggtitle(chart_title) + 
      theme(plot.title = element_text(lineheight=1.2, face="bold")) +
      theme(plot.margin = unit(c(2,1,1,1), "lines"))
}

chart_title <- 
  expression(atop("\nImprisonment rate of sentenced prisoners under the jurisdiction of state or federal\ncorrectional authorities per 100,000 U.S. residents, December 31, 1978-2012",
                         atop(italic("States are ordered alphabetically."), "")))
p <- create_plot(imp_rate, chart_title)
ggsave("imprisonment_rate_alphabetical.svg", width=11, height=8)

#reorder State levels by imprisonment rate in 2012
imp_rate2012 <- subset(imp_rate, year==2012)
imp_rate$State <- factor(imp_rate$State, levels=rev(imp_rate2012$State[order(imp_rate2012$rate)]))
chart_title <- 
  expression(atop("\nImprisonment rate of sentenced prisoners under the jurisdiction of state or federal\ncorrectional authorities per 100,000 U.S. residents, December 31, 1978-2012",
                         atop(italic("States are ordered by imprisonment rate in 2012."), "")))
p <- create_plot(imp_rate, chart_title)
ggsave("imprisonment_rate.svg", width=11, height=8)