The September state unemployment numbers came out last Friday, and we couldn't help noticing that three of the four states with the highest job losses were California (-63,500), New York (-37,600) and New Jersey (-20,200). The other was Massachusetts (-20,900). Texas, meanwhile, gained 4,000 jobs.
This continues a longer term trend.Over the last year, as the economy was beginning to grow again, the Lone Star State has led the nation with the addition of nearly 153,000 jobs, while California surrendered 43,700, New Jersey lost 42,300 and New York dropped 14,600. This superior jobs recovery builds on the fact that Texas also weathered the national recession better than most states. According to a new Texas Public Policy Foundation study, Texas experienced a decline of 2.3% from its peak employment, while California fell nearly four times further, with 8.7% of jobs vanishing.
These hiring statistics confirm that for business Texas is the new California—as the likes of Austin, Dallas and San Antonio have become destinations for investment and entrepreneurship. Texas has become a mecca for high tech, venture capital, aeronautics, health care and even industrial manufacturing like the building of cars and trucks.
Meanwhile, the Golden State, New York and New Jersey have been slouching toward slow-growth European status. New Jersey is at least working to get its spending and taxes under control with Chris Christie as Governor, though its state and local tax burden remains the nation's highest and its business tax climate is the worst, according to the Tax Foundation.
The migration of factories, capital and jobs to states like Texas is no accident. Texas is a right to work state, meaning that workers cannot be compelled to join a union. Texas also has no income tax, which gives its firms a roughly 10% cost advantage over a "progressive" state like California.
There is also a lesson here for Washington. The job-free zones of California, New Jersey and New York each tax the rich more than nearly all other states. In these states the top 1% wealthiest taxpayers bear roughly 40% of the state income tax burden, but their budgets are still a mess and the job losses continue. If the next crop of Governors and the 112th Congress want faster growth and more job creation, they'll avoid the mistakes of California and New York and learn from Texas.
Texans for Rick Perry today launched a new 30 second TV ad called “Clear Choice.”
“Campaigns are about choices, and Texas voters have a clear choice in this election,” said Texans for Rick Perry spokesman Mark Miner. “Gov. Rick Perry’s proven leadership and Texas values have made Texas a model for the rest of the nation, and Gov. Perry will continue to travel the state during these final days speaking directly to voters and promoting positive conservative principles of low taxes, limited government and personal liberty.”
Join over 100 groups in supporting Gov. Perry for re-election
HOUSTON – Today Gov. Rick Perry received the endorsement of former President George H.W. Bush and former First Lady Barbara Bush for the general election. They were joined by representatives from more than 100 organizations and hundreds of leaders who have endorsed Gov. Perry’s re-election, highlighting his diverse, statewide support, which represents millions of Texans.
“Gov. Perry’s leadership and proven track record is an essential component in keeping Texas a national leader in job creation,” said former President George H.W. Bush. “Texas has become a prime example of what happens when you mix fiscal responsibility, strong leadership and a vision of moving a state forward. It is an honor to endorse Gov. Rick Perry for the general election.”
George H.W. Bush was sworn in as president of the United States in January 1989 and served until January 1993. During his term in office, the Cold War ended; the threat of nuclear war was drastically reduced; the Soviet Union ceased to exist, replaced by a democratic Russia with the Baltic States becoming free; the Berlin Wall fell and Germany was reunified with Eastern Europe; and he put together an unprecedented international coalition to liberate Kuwait.
Former First Lady Barbara Bush is a tireless advocate of volunteerism, helping countless charities and humanitarian causes. Today she and President Bush serve as Co-Chairs of C-Change, an organization that represents more than 150 individuals and groups that fight cancer. She also enjoys reading to children at schools and hospitals across the nation.
“I am deeply honored to receive the endorsement of former President George H. W. Bush and former First Lady Barbara Bush,” said Gov. Perry. “His devotion and leadership, to our country, has brought forth inspiration to us all.”
Gov. Perry’s endorsements highlight the broad-based support he has from diverse groups and industries, ranging from agriculture, health care and retail sales, to construction, law enforcement and education.
In his remarks, Gov. Perry emphasized the creation of 850,000 Texas jobs in the last ten years and the recent drop in the unemployment rate in Texas; leaving the national rate nearly two points above ours. He also touted our state’s low taxes, predictable regulatory climate, fair legal system and education efforts as crucial elements that have helped make it a national leader in exports and Fortune 1000 companies.
MARSHALL, TEXAS—Even in this small, quaint East Texas town, 20 miles from the Louisiana border, everything seems larger than life.
From the endless rolling hills to the massive German shepherds that gave chase during my ill-advised runs in the countryside to the heaping portions of barbeque at the Country Tavern in nearby Kilgore (where I, keeping kosher, settled for a huge green salad), stuff in Texas just seems bigger.
Politics, too, looms larger and more potent here than elsewhere. A former judge and the first Republican to represent this district since Reconstruction, Rep. Louie Gohmert is the kind of conservative that makes Glenn Beck and Sarah Palin seem squishy.
Among his more notable achievements, he voted against both TARP and the stimulus; he supported a two-month tax income tax holiday for all Americans; he co-sponsored legislation that would compel all presidential candidates to make available certified copies of their birth-certificates; he went on national television to decry the scourge of “terror babies,” or the Islamist equivalent of anchor babies born to foreigners in the U.S.; and he accused the Centers for Disease Control and Prevention of seeking the power “to force you to eat more fruits and vegetables.”
It’s not just the politicians who embody supercharged conservative values, but the grassroots activists too. Earlier this year, a billboard in Marshall made national waves, asking passersby, simply: “Voted Obama? Embarrassed Yet?”
Another billboard just outside my hotel was all black with the following message scrawled in bright yellow writing: “Had Enough of: Stimulus…Bailouts…Homosexual Marriage? Then Vote Republican.” There didn’t seem to be anyone in particular who approved that message.
But what’s really big in Texas nowadays is economic recovery, especially compared to California. The Bureau of Labor Statistics reports that more than half of the net new jobs created in the United States over the past 12 months originated here in Texas: 119,000 out of 214,000. Amazingly, during those same twelve months, California shed 112,000 net jobs—almost the same number that Texas created.
While Californians have been afflicted by a 12.4% unemployment rate—nearly three points above the national average—Texans enjoy an 8.1% rate, a point and a half below the U.S. as a whole.
So how has the Lone Star State done it? Simple: lower taxes, less spending, and a friendly business climate.
Unlike California and many states in the union, Texas has no state income tax. So while states like Washington, which also has no such tax, are entertaining ballot measures that would actually add a state income tax in the middle of a recession, Texas has remained blissfully free of such a levy. And while Texas imposes an oil severance tax, which we in California still (thankfully) don’t have, the burden it imposes pales in comparison to our cumulative tax load.
Furthermore, the state government in Austin spends much less than comparably-sized states. According to the Texas Public Policy Foundation, the state’s budget in 2008 amounted to 17.3% of GDP, five points less than the nation as a whole and eight points less than the Golden State. Spending per capita in California is 33% greater than in Texas. Indeed, it’s difficult for the legislature to spend much when it meets only every other year.
But most impressively, the state goes out of its way to recruit businesses to its precincts. Governor Rick Perry famously takes “hunting trips” in California for businesses sick and tired of our deadly combination of high taxes and absurd regulation. Even Sen. Dianne Feinstein’s husband recently moved workers from the Orange County office of his CB Richard Ellis real estate company to Dallas.
According to the Claremont Institute’s William Voegeli, between 2000 and 2007, California lost 1.1 million people while Texas absorbed 500,000 new arrivals. And whereas California for the first time in more than 100 years will likely not receive a new congressional seat after the 2010 decennial redistricting, Texas is set to gain as many as four new congressmen.
So sure enough, Texas isn’t just big, it’s getting bigger, and at the expense of states like our own. Until we turn things around quickly in California by learning from the Lone Star state, Texas will keep eating our lunch.
It is often pointed out that the states make great laboratories for political-science experiments. And an experiment has been underway for quite a while testing the liberal model — high taxes, extensive regulation, many government-provided social services, union-friendly laws — against the conservative model — low taxes, limited regulation and social services, right-to-work laws. The results are increasingly in. As Rich Lowry reports in National Review Online, the differences between California and Texas are striking. Between August 2009 and August 2010, the nation created a net of 214,000 jobs. Texas created more than half of them, 119,000. California lost 112,000 jobs in that period. Lowry writes:
Texas is a model of governmental restraint. In 2008, state and local expenditures were 25.5 percent of GDP in California, 22.8 in the U.S., and 17.3 in Texas. Back in 1987, levels of spending were roughly similar in these places. The recessions of 1991 and 2001 spiked spending everywhere, but each time Texas fought to bring it down to pre-recession levels. “Because of this policy decision,” the Texas Public Policy Foundation report notes, “Texas’ 2008 spending burden remained slightly below its 1987 levels — a major accomplishment.”
The result has been dramatic: “A new Texas Public Policy Foundation report notes that Texas experienced a decline of 2.3 percent from its peak employment [in the current recession], while the nation declined 5.7 percent and California 8.7 percent.” And people have been voting with their feet: A thousand people a day are moving to Texas. It will likely gain four House seats next year, while California for the first time since it became a state in 1850 will gain none.
So, again, the evidence would seem to be overwhelming: high tax-and-spend policies and regulation produces stagnation and unemployment, low tax-and-spend policies and regulatory restraint produce the opposite.
Texas has been the engine of the current economic recovery, creating more than half of net job growth across the country in the last twelve months. From 2000 to 2009, while Texas created more jobs than all the other states combined, it simultaneously lowered its ozone levels 22 percent; the nation as a whole lowered its ozone level only 8 percent. Houston, which had long been vying with Los Angeles for the title of the most ozone-polluted city in the country, achieved the federally required ozone standard last year. In fact, all Texas urban regions met the federal standard except Dallas/Fort Worth, which exceeded the standard by only one part per billion. Stringent but targeted controls, cutting-edge science, innovative technology, billions of dollars invested by the state and private industry, and the volunteer efforts of thousands of Texans drove the improvements in air quality. The state designed and implemented the undertaking largely in cooperation with EPA.
We need your help keeping Texas strong and prosperous! Visit http://hq.rickperry.org now, and get your friends, family, and colleagues who support Governor Perry out to vote. Early voting begins today, Monday, October 18th, and runs through October 29th!
Join the campaign today, and help us keep our strong momentum going.
No doubt, the recession has reached every state in America, and Texas is not immune, but did you know that Texas is where 4 out of 5 new private sector jobs have been created since 2005? For more info, check out the “Right Track video on Governor Perry's YouTube page.”
Texas already looms large in its own imagination. Its elevated self-image didn’t need this: More than half of the net new jobs in the U.S. during the past 12 months were created in the Lone Star State.
According to the Bureau of Labor Statistics, 214,000 net new jobs were created in the United States from August 2009 to August 2010. Texas created 119,000 jobs during the same period. If every state in the country had performed as well, we’d have created about 1.5 million jobs nationally during the past year, and maybe “stimulus” wouldn’t be such a dirty word.
What does Austin know that Washington doesn’t? At its simplest: Don’t overtax and -spend, keep regulations to a minimum, avoid letting unions and trial lawyers run riot, and display an enormous neon sign saying, “Open for Business.”
Investor's Business Daily explains that Texas is leaving California in the dust, when it comes to recovering from the recession:
In Texas, the payroll count is back to pre-recession levels. California is nearly 1.5 million jobs in the hole. Why such a difference? Chalk it up to taxes, regulation and attitude.
The contrast between America's two largest states, in terms of both population and economic heft, is as stark as it has ever been. Texas is leading the country out of the recession; California is holding it back.
Additionally, the Milken Institute examined U.S. metropolitan areas and ranked them by how well they are creating and sustaining jobs and economic growth. Texas claims 3 of the top 4 states, 5 of the top 10, and 11 of the strongest 25 cities in America. The Texas Public Policy Foundation also noted this week that in the battle between Texas and California, Texas wins, hands-down:
The report noted that the latest Bureau of Labor Statistics data showed that Texas had gained 129,000 new jobs in the last year—more than half of the national total—while California had lost 112,000 during the same period.
“Texas’s superior economic performance is noteworthy,” Dr. Laffer said. “It’s just striking how the states with no income tax outperform the states with high income taxes. And the reason is simple: employers move to the location that promises better after-tax returns. Texas constantly focuses on improving its economic competitiveness and the citizens of Texas are benefiting because of it.”
The research showed that Texas’ economy has been growing stronger and with less volatility than California or the nation as a whole.
We need your help keeping Texas strong and prosperous! Visit http://hq.rickperry.org now, and recruit your friends, family, and colleagues who support Governor Perry. Early voting begins on Monday, October 18th! Find the most convenient Texas Early Voting locations in your county, and vote early to avoid the lines on November 2. Remember, you can vote anywhere in your county during early voting, but you'll have to vote at your specific precinct polling place on Election Day itself.
Join us today, and help us keep our strong momentum going.