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The Texas Growth Machine « Back to Story
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Can we stop comparing low cost states vs high cost states? There is a reason why some places are more costly than others, why some states are less regulated than others. Every state has its own culture, politics and economics - its been that way since before the Colonies. Every locale has its pros and cons. So if you like a place, move there. If not, stop complaining. This constant "liberal vs conservative" drabble has to end.
There are some seriously sick and jealous lefties commenting on this article!
And that is to be expected from these pathetic losers....LOL
My liberal friend has tried to write Texas off as a "low-income state", but yet he is here.
Texas has unique challenges. I hope to see it grow for years to come.
Texas is and will always remain (outside of Austin and the Hill Country) a hell hole. Tornadoes, drought, hurricanes, incredible humidity, big ass bugs, high property taxes and homeowner's insurance, ridiculous frontage roads and native Texans all make for a place that is nearly unlivable.
Now, with Texas lips firmly stuck on the Federal Government's tit will the scalawags and liars of the right be exposed. The hit Texas is going to take from the Sequester is going to bare the lie othat Texas succeeds for all the reasons it (appears) to.
Texas is one big ass welfare state.
Sad part is that refugees from progressive states will bring their voting habits and destroy it. Just like with Oregon.
Interesting. But is this a useful model for anyone else? Everyone can't steal their workers from everone else? Texas is just the cheapers whore on the street corner.
Part of the reason for the low housing prices also has to do with two additional factors besides the large supply of cheap buildable land: high property taxes, and heavy restrictions on home equity loans (which weren't allowed at all until 1997), that are enshrined in the state constitution. The high property taxes make hold-and-flip real estate investment unappealing and the restrictions on home equity loans make cash out refis by speculators virtually impossible (home equity loans in TX can't let your total mortgage debt exceed 80% of the market value of your home).
There is absolutely no reason whatsover to have public schools. Have the government give parents a voucher for each child (equal to, say, 65% the per-child tax the government spends on education, and have the other 35% go towards the kids of poor people over and above their base amount), and let the parents spend their money at the educational institution of their choice. If they want, they are free to spend more.
Free market competition will provide the highest quality of education, for the greatest number of studends. If some schools want to have unions, so be it. If others don't, that's fine as well. If a school has good teachers, the parents will be happy to pay more to that school so they can reward the good teachers. If a school has bad teachers and refuses to get rid of them, then let the school fail.
Only parents should decide how their education dollars are spent for their kids. It's really that simple.
Of course, the "problem" with this structure is that the unions won't have much power, if any.
I am an architect who has been practicing in Ca for 35 years. To give you an idea of the no sense regulations we have here, we are doing a remodel to a hospital that entails replacing 4 doors of the same type and size in the existing frames,(because they were old & deteriorated) that's it. The set of plans was 10 pages and still the state OSHPOD plan check corrections were about a page long. For example, they want structural calcs to verify that the wall can handle the pair of 3' doors (they actually say that the existing frames are not designed to support the doors), calcs for the continuous hinge to verify it can hold the door. It took longer and cost more to get the permit than my first retail office building project 30 years ago. All this gets passed on to the consumer.
Stephen - why is cutting school funding something evil? Where I live schools should be given less money - right now a significant number of the people working at the high school my three children went to have nothing to do with teaching,. There is even someone employed full time to deal with "gangs" even though I've never heard any solid evidence of gangs in the school.
Why do state employees get COLA adjustments? I don't. I work in the private sector and I can only dream of the bennies state workers get - lots of vacations and lifetime medical et als. And retirement after 25 years with an immediate pension and medicals for you and family for life for police or fire whether you worked in the city or in some sleepy suburban town. Also why would "state aligned agencies" (what is a state aligned agency?) also be entitled to anything?
The way to improve education is to encourage parents to stay together to raise children, it's as simple as that. (read the stats). Money does NOT equal education - we have proved that over and over here in New Jersey through the ridiculous Abbott litigation.
Cutting school funding? GOOD IDEA. No COLA increases for state employees and "state aligned agencies"? Also GOOD IDEA. Means less taxes, and hopefully, at some point, less state workers.
God Bless TEXAS ...we love you!!!
If we're doing so great here in the Big "T", why are we cutting school funding? Why do state of Texas employees and state aligned agencies, like education, get no cost-of-living raises or cols that don't keep pace with inflation.
For all the opportunity to ski and surf within the same day boasting, Texans lead Californians when it comes to trusting their state government. With a real world monopoly on armed force, trust in government is important although our cultural elites downplay the “armed force” concept and play up the notion of governmental benevolence. But governments, beyond being textbook abstractions, employ force to achieve their goals in a manner forbidden to us average citizens.
So, the question becomes how much wealth will your government allow you to keep once it’s earned? Can you will, in its entirety, the business you created through hard work to your heirs – will that be permitted by your government? Can you retain the bulk of your earnings or be forced to remit an ever growing portion to faceless strangers, benevolent or otherwise, within your government? Trust in your personal future involves, more and more, how much trust you place in your government’s future intentions.
As the mythical frog metaphor teaches, slowly heating the water means the frog eventually boils to death rather than immediately leaping from pot. And slowly raising your personal obligation to your government may keep you residing in California when common sense hints you may be making a serious mistake. Do Californians trust their government to be responsible and manage public affairs in a prudent, intelligent manner – perhaps less so now than in times past. Do Californians trust their fellow citizens to cast their vote wisely?
Texans, I have found, are unashamedly independent cusses who trust one another to keep state and local governments on a safe course in order to ensure political greed and a thirst for power don’t unduly threaten themselves and their offspring. Californians, on the other hand, have no reason to trust each other, we don’t look alike, we pray to different gods, speak different languages, hold different cultural values and have no more sense of common, reciprocal community than passengers awaiting their flights in a typical airport terminal. An ideal climate may not prove an adequate substitute for trust and brilliant sunshine in the daily weather forecasts doesn’t guarantee personal protection from your government’s future intentions.
Please note a fundimental political-cultural difference between California and Texas is that 95% of Texas land is in private hands. Less than 50% of California land is in non-government or non-corporate private hands.
The sort of land use environmental restrictions you see in California are politically impossible in Texas due to that wide spread private ownership.
For those poor soles still living in CA, NY & IL; if I was stuck in a similar position, (with my hands firmly and permanently grasped around my ankles, and my trousers crumpled-up and resting around my shoe tops) I too would try my best to deny what has become commonly known by all outsiders looking in as “your duefully deserved destiny.” Please, for the betterment of mankind, let your ill-conceived Liberal infestation go forth to its fitting conclusion to never be uttered again!
What kind of serious article talks about job growth in Texas without directly mentioning the oil boom, which according to a Dec 2012 report by IHS CERA, is responsible for adding more than 576,000 jobs in Texas?
Lake Worth, you're correct that Texas job growth since 2007 has largely been in government employment. However, from 2000-2010, Texas added 1.08 million total jobs while the number of employed Californians did not increase at all (source: Cal. Economic Development Dept.)
But, let's suppose for a minute that the real reason for Texas's lower unemployment is state and local government jobs. I wonder how the Texans managed to afford that, since their state is 45th in the nation in total state and local tax burden, compared to California, which is 4th. (Tax Foundation, 2010).
I have lived in Texas for 30 years. Originally from Chicago I never moved back because it made no sense to pay a state income tax to a corrupt government in a state with bad weather.Texas, contrary to what others who have never lived here believe, is a wonderful state with intelligent hard working friendly people who enjoy their freedom and texas culture. Texas is high tech especially Austin and Houston. Houston is the world capital of energy and that translates into many jobs that pay. Those are jobs from around the world to finance, engineer and build energy projects throughout the world. We do not need socialism and all the destruction that reigns upon the recipients of such a failed social policy. It didn't work in East Germany and it will not work in Illinois, California or the USA.
Kady - it is too soon to measure how the Californian influx into Texas will change Texas' politics, but the Californian influx will turn Texas into a socialist state for sure. It has happened everywhere else Californians have moved to in large numbers. It is better for Texas that Californians stay in California and the California socialist virus therefore be contained.
Princeton Review ranks the University of Houston the number 1 Entrepreneurial College in the country. UH Rocks!
University of Houston Rocks!
This is humor ??? The recent job growth in Texas was produced directly by increases by public employment. Rick Perry & Co. stopped wasting money on long-term capital investment and put it to new-hire public employment.
Between December 2007 and June 2011 private-sector employment in Texas declined by 0.6 percent. same period, public-sector jobs increased by 6.4 percent. Keynesian government stimulus was what drove the Texas economy -- generating immediate multiplier effects that limited the private sector losses. Based on the numbers, not much else happened.
And then Texas ran into a projected $27-billion budget deficit. Even this crazed/dishonest article from Wendell Cox -- that never mentions the huge 2007-2011 increases to public employment -- is put out at the very end of it's limited truthiness.
"Sadly for Texas, its quest to lure Californians in large numbers will result in the end of its successful economic policies, as Californians when they move anywhere in large numbers try to turn wherever they're living into California. "
Nonsense. The people moving here know WHY they're moving here and they had to leave their prior state. Texas got redder between 2008 and 2012: look up the winning margins of McCain vs Romney.
Sadly for Texas, its quest to lure Californians in large numbers will result in the end of its successful economic policies, as Californians when they move anywhere in large numbers try to turn wherever they're living into California. Governor Perry will regret his efforts to lure Californians, as they will turn Texas into a failed socialist state like the once Golden State is right now.
Good paying jobs??? Based on the numbers in figures 3 and 4, it appears that over 75% of the jobs created in Texas were in industries that pay less than the average US wage. Way to go!
Good paying jobs??? Based on the numbers in figures 3 and 4, it appears that over 75% of the jobs created in Texas were in industries that pay less than the average US wage. Way to go!
As a card-carrying economist, I can't help but sympathize with this paean to TX versus CA and NY. But it's missing the socio-cultural skinny. I grew up in upstate NY; went to school in Chicago, IL; and now live and work in So Cal. In-between all that, I lived and worked in Houston TX. Aside from the fact that my 20% higher CA income makes me no better off (materially) than in TX, boy do I miss the zany, fluid, permanent state of becoming something else that is Houston TX. I understand there was a time when that was CA. But it seems long past. TX grows because it retains its immigrants and natives; CA now loses them in droves to other states (particularly CO I have heard). Just saying, I miss TX not for the economy but for the the cultural zing, the permanent state of uproar, the wild immigrant energy and a political culture that puts no brakes whatsoever on any of that.
For Marty Kay zee:
You are correct that the author did not mention the money that Texas received from the Recovery Act.
The total amount of money that was provided by the Recovery Act may be found on the following web site:
All of the states received money from the Recovery Act. The largest states received the largest amount of funds. The web site covers data from the period Feb 17, 2009 to Dec 30, 2012. The following data from the web site:
State Amount Granted Amount Received
California $34,590,742,713 $27,257,852,419
New York $17,107469,362 $14,315,903,785
Texas $17,029,412,279 $14,718,219,567
According to the web site, Texas received one half of the money provided to California and almost the same amount provided to New York. The jobs reported to be claimed from the recovery act were
New York 5,841
Texas has taken almost $24 billion in federal stimulus since 2009. You forgot to mention that?
A lot of the housing cost advantage is due to the absence of government efforts to drive up housing costs, which are essentially the net result of such things as zoning, land use planning, transportation planning, etc., and therefor presumably the intended purposes of such governmental action as well.
The refrain that the Texas economy is a mirage comes mostly from the Blue state economies that are being bled dry of working population by Texas. Liberals cannot conceive of a growing economy that does not operate a government that is spending at an even faster pace. The truth is that Texas would rather Texan's keep the money they earn. That is unheard of in IL, CA and NY.
Billy Joe said:
"California led the nation in job creation in 2012."
Your comment is not supported by the Bureau of Labor Statistics (BLS).
The following is from the Bureau of Labor of Statistics (BLS) and may be found at the following BLS web site:
“Texas has largest over-the-year employment increase; Nevada has largest unemployment rate decrease
JANUARY 22, 2013
Over the year, 30 states experienced statistically significant changes in employment. The largest over-the-year jobs increase occurred in Texas, where employment increased from 10,643,200 to 10,904,000 from December 2011 to December 2012 (a change of +260,800), followed by California (+225,900) and New York (+123,600). Only West Virginia’s employment decreased (-13,900).”
The population of California is 38,041,430 whereas, the population of Texas is 26,059,203. Texas has one-third less population than California, but has added over 34 thousand more jobs than California in the time in the Dec 2011 to Dec 2012 timeframe.
I live in California and I can't wait to leave this state. Texas, here I come!
and California ranks 28th in a "pleasant living environment'? What ahve these people been drinking? Or smoking? What an absurd article. California led the nation in job creation in 2012.
"An above average number of jobs came from government related industries."
The Texas GDP may be found in the following table published by the US Government Bureau of Economic Analysis (BEA):
As you can see from the table, the Texas GDP is across a very wide number of areas and not just government related areas. If you have valid data from a US Government source that justifies your comment,please provide it.
Realist(?), according to you, "people are willing to pay a hella lot more to live in California than Texas." If that's true, then why does it cost $1693 to rent a twenty-foot U-Haul truck in San Francisco to drive to San Antonio vs. $983 to drive the same truck the other way? Isn't that because so many people are NOT "willing to pay a hella lot more to live in California" but are willing to pay seven hundred dollars to move out? This applies, of course, primarily to the kind of people who move in U-Haul trucks, the middle class. California is losing its middle class, according to the Center on Budget and Policy Priorities. Their report of 11/15/2012 lists California as second in the nation in ratio of highest income households to middle income; Texas is seventh. That disparity has increased in both states since the 1970's, but California was second in the nation in that increase in inequality; Texas was eighth. If, as you say, California costs more because people are willing to pay it, that does not explain California's net loss of 3.6 million Americans to other states since 1990. On the other hand, your claim that "California is a luxury property" would explain it, if the exodus has been led by middle class people with little to spare for luxuries.
RE: Realist- California was smart enough to have one of the worlds greatest coastlines. Good thinkin Jerry Brown.
"The Democratic misery machine will eventualy catch up to Texas too. It is only a matter of time. Especially, since the Republican party has not shown that it has any idea what it is up against - it still plays by the old rules. Have you ever seen anything more pathetic than watching Romney try to get his message out through the Democratic media machine? Or watching Boehner try to do the same thing?"
Thank you for your very interesting comments. You put the Liberals in a context that I had not considered. I would like to make a comment concerning your comments that I have quoted above.
In the last election, Texans voted for the Fiscal Conservative, Ted Cruz and rejected, by a wide margin, the Republican Establishment candidate, David Dewhurst. Texans are not interested in supporting the Republican Party that "still plays by the old rules". The purge of RINOs has begun in Texas. In the next election, RINOs will be primaried in Texas. Texans demand small government, low taxes and minimal restrictions on business and the people. Last of all, Gov Perry has championed the causes of the "religious right"; a caused that I don't believe is supported by the majority of Texans.
jgury - The graphics are for the benefit of those in New York and California because they're too ignorant to understand the numbers alone. They need pictures to help them understand.
(1) California is by far the favorite destination of international immigrants - and most of those immigrants are well-educated Asians. If Chinese entrepreneurs prefer California, we're doing something right.
(2) Yeah, Texas cost less. And Mississippi has an even lower cost of living. California is a luxury property - you pay more to live in a place where you can surf and snow ski on the same day.
(3) California has some of the most expensive cities in the country. For all you purported capitalists out there - ding, ding, ding - that means that people are willing to pay hella lot more to live in California than Texas. Think there may be a reason for that?
California cost more because people are willing to pay it! That's all, folks.
It rains all the time in WA. Folks from CA would be much happier in TX
Texas prosperous you say? So what - for Democrats what Texas has done points the way to what to avoid. The way that Democrats think, the fact that California and New York are not doing well economically is all to the better. New York State's overal economic decline, for example, has led to little or no population growth upstate, in areas that are traditionally Republican. So, a state where state-wide offices were more or less shared is now almost exclusively Democrat, and becoming more so by the day. Same thing here in New Jersey, where Democrats have used the subterfuge of environmental protection to limit growth in areas that are traditionally Republican - the so called "Pinelands" and "Highlands." By limiting the growth in these areas, as well as the usual assortment of crushing taxes and burdensome regulations, Democrats have ensured a permanent majority in statewide offices (despite Christie's win which was due to the stunning incompetence of his predecessor). This is a state that once voted for for Nixon.
As I've said before, Democrats understand full well that they do best among poor people, so that policies that favor growth and wealth creation are to be avoided - since adoption of those policies could result in the poor not remaining poor. Policies that create and maintain poverty are what Democrats seek - if you understand this you understand the Democratic Party.
Democrats in California, for example, know that ensuring a permanent underclass requires high taxes and burdensome regulations, families that require state support (single mothers), which result in crime and low achieving schools - all the better to drive Republicans out of state. The state is committed to a permanent state of crisis, requiring more government workers to solve society's ills (ills brought on by Democrats) requiring even more taxes and regulations. Public employee unions fill the campaign coffers, which again requires more taxes.
The result of all this, a model developed on a city wide basis, now applied to the state, and it is working marvelously in California and other places.
Add in a media that shares a revolving door with the Party and you have a machine that is able to create an IMPRESSION of working to solve society's ills but is in fact propagating them. Democrats have been able to develop a political machine capable to crushing opposition, while at the same time generating misery on a societal scale - misery which it blames on Republicans which have little or no say in the process.
Take this to heart: Democrats don't care a whit about prosperity, growth, crime or anything but maintaining and enhancing power. They know the way to power is through creation of a permanent underclass, which depends on the Party structure for support. Democrats have no compunction about doing whatever it is necessary to maintain power - lying, cheating, stealing - they can do all this and more because control of the means of communication results in never being taken to task for any of it.
Texas prosperous? Big deal - this is not a model for the rest of society if you are a Democrat.
The Democratic misery machine will eventualy catch up to Texas too. It is only a matter of time. Especially, since the Republican party has not shown that it has any idea what it is up against - it still plays by the old rules. Have you ever seen anything more pathetic than watching Romney try to get his message out through the Democratic media machine? Or watching Boehner try to do the same thing?
Again - Texas prosperous? It's success is providing ways not to govern, for Democrats.
An above average number of jobs came from governement related industires.
Said well, Michael J Caulfield. I have very liberal in-laws that are moving to Texas for the jobs. They have no clue why there are no jobs where they are from. They will ruin everything in Texas, and I am not looking forward to it.
John Stossel: Texas vs. California
California does have stricter land-use restrictions, but the housing price differences are more related to geography. In Texas, you have lots of buildable flat land in all directions. In California, you have more restricted land (i.e. mountains and desert), and you can only grow in one direction: inland.
Anyone who thinks California or NY is a better place than Texas or on the rebound has no real clue as to the state of their economies. California just passed the first of many tax raises and NY has been passing them non-stop for years. Though Perry is okay as a governor, compared to Moonbeam and the crooks in Albany, he's an Icon.
Gov. Perry will be out in my area (California) to try a lure away Haas Automation (the nation's largest CNC tool builder). We'll see what happens. California got hurt during the recession, but we are on the rebound. Watch the comeback.
Bob Bregman February 10, 2013 at 10:38 PM
All well and good, but I'd rather live in CA, whre I am now, or NY, where I used to live. I spent 3 yrs in Texas, that was enough...
Really!! Your horns are showing! We don't want liberals moving here anyway! Don't mess with Texas!
Texas' record speaks for itself. Enjoy getting taxed to death in both NY and CA!
At a glance the growth in jobs looks robust, but the numbers in figure #4, "The Texas Top Ten," make the employment gains less impressive.
The only categories that might be actually producing wealth and capital are #5: Mining, Quarrying, Oil & Gas extraction, and possibly #3: Professional, Scientific, Technical.
All the rest are support or service jobs. Not a mix that, in my opinion, bodes well for the future of either the economy of Texas or the U.S. of A where this trend is repeated.
My biggest fear is that the liberals will try to ruin Texas just as they have CA, IL, NY and NJ. Their formula for disaster is five-fold: 1) believe that government can cure every problem; 2) rob from those who work and give to those who don't; 3) spend more than you make; 4) blame excess spending on not taxing enough; 5) remove God, Jesus and Christianity from every phase of American life including our schools, government, media, psychiatry, organized labor, and social practices (replace with radical agendas).
Brilliant analysis. Housing is such an important factor. Thank you
All well and good, but I'd rather live in CA, whre I am now, or NY, where I used to live. I spent 3 yrs in Texas, that was enough
Nice reporting. Thank you Wendell Cox.
What is up with these infographics? Low budget USA today? Bloomberg Business week? Demographia.com is not exactly where I look at for data on Texas economics, or anything else.