Monday, November 18, 2013

Texas vs. California: Case Closed


The economic contrast between Texas and California is an old theme at Cahnman's Musings.  This afternoon, we were pleased to attend the Texas Public Policy Foundation's "Competition and the States: Texas vs. California" which unveiled their new paper "How Big Government Hurts the Economy: Texas vs. California."  Former Reagan Economic Adviser Art Laffer and Governor Perry Spoke.

Going first, Art Laffer rattled off an astonishing list of statistics from the TPPF paper (which he co-authored):

  • One fifth of all Americans live in Texas or California.
  • California has the highest REAL poverty rate in America.
    • Adjusted for cost of living and government benefits.
  • California's tax rate on marginal economic activity is approximately 65% higher than Texas, but tax revenue is only 25% higher.
  • Just the fees (without building a thing) for a single family home are between $75,000 and $100,000 in California.
  • One mile of highway construction costs $265,000 in California compared to $88,000 in Texas; despite this, Texas ranks 23rd nationally in road conditions, while California is dead last.
  • Of the 5 "mega-states" (CA, NY, TX, IL, and FL), California has the lowest test scores, Texas is (by far) the highest.
  • California has 74% more welfare case workers than Texas.
Speaking next, Governor Perry had the best in-person performance we've seen from him in at least a year.  Governor Perry spoke with moving passion about economic growth and the "two competing visions in America."  9 of the 10 states that lead in job creation have Republican governors.  That economic growth enables people to live the lives they see fit.  In the competition with California: "The discussion is over.  The debate is over.  The proof is in.  Texas wins!!!"

In reading the paper, a number of other statistics stand out:
  • "California has swung from being one of the biggest net in-migration destination states in the nation to being one of the biggest exodus states." (4)
  • "Texas has the fourth lowest percent of population on welfare....while California has the highest percentage of its population on welfare" (4) [Emphasis ours]
  • "Texas ranks third fastest in employment growth in the nation while California ranks 42nd." (4)
  • "Public welfare employees in California make over $56,000 per year to Texas' $37,000 per anum -- a 52 percent premium." (5)
Another major contrast is the attitude towards energy development and resource recovery.  California has similar amounts of oil and gas reserves as Texas.  The difference is that Texas uses our God-given resources, while California lets the crony-capitalists in the "green energy" racket set their energy policy.

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The most amusing part of the afternoon was an intense men's room conversation on local government debt we witnessed between Texas State Reps Steve Toth and Bill Zedler.  Speaking from the urinal, Representative Toth told Cahnman's Musings, on the subject of local government debt:

"Size matters...and you can quote me on that!"

Consider it done Steve Toth.

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