In a very interesting five-part series, journalist Mark Hemingway analyzes the different approaches to government found in Texas and California. In the first, he posits:
Among the states, it has become clear there are two competing visions of political economy in America, embodied by California and Texas. One vision involves the economic devastation that comes of an overregulated economy. The other reveals the prosperity unleashed by smaller government.
Broadly speaking, the two states have many similarities. They have diverse economies, large urban areas, a border with Mexico and similar demographic make-up, with Hispanics a third of the population. Yet one state is failing and one state is succeeding.
California is facing budget shortfalls in excess of $20 billion each year for the next five years, and acquires $25 million in new debt each day. "We’ve been living in fantasy land. It is much worse than I thought. I’m shocked," then California Gov.-elect Jerry Brown, D, told the Los Angeles Times.
By contrast, when Gov. Rick Perry, R-Texas, campaigned successfully for a third term this year, he ran ads touting the fact that his state has billions in surplus. In fact, Texas was one of only six states that did not run a budget deficit in 2009.
The five articles are:
- Texas booms while California busts
- California divides taxpayer money among its politicians
- California taxes away jobs while Texas adds them
- California's environmental regulations cause economic blackout
- California unions stand in the way of a Texas-sized success
In the light of what's going on in Wisconsin at the moment, these articles are very timely, and make interesting reading. Recommended.
Peter
2 comments:
The states may be similar, but they still aren't similar enough. A quick snapshot here and there doesn't even begin to tell the full tale.
It wasn't that many years ago that Texas was having its own economic woes, and it seems to me that California was doing OK back then. There certainly weren't the bankruptcy's going on in CA compared to TX. And the cause of that was the implosion of the oil industry. Despite what happens in the economy, oil continues to go higher and higher. Strip out that oil revenue, and I think you'd see that Texas would be hurting just as badly as California.
So yes, California has boomed while Texas busts in the past.
By the same token, you could compare Texas and Florida, since they seem to have the same regulatory outlook. And things all of a sudden don't look to sunny, especially for the Sunshine State. The state is facing billions in deficits, even as the governor wants to commit another two billion to business tax cuts. It's an attempt to try and draw business to the state. I can't wait to see what happens when new workers have to spend days at the DMV to get their drivers license and auto tags switched after the governor does the same thing to this state. I'm sure the employers will just blame the employees (on both sides of the transaction).
As far as trying to make any statement about the Wisconsin issue going on right now, I find it odd that you didn't also list Wisconsin as being one of those six states that didn't run a budget deficit in 2009.
The best thing that TX has going for it is the fact that Texas law requires a balanced budget.
Unfortunately, Texas is now trying to make up a $25 budget shortfall (the difference between 2010 expenditures or 2011 agency budget requests, I can't recall; and projected 2011 tax revenue). This shortfall requires MASSIVE reductions in govt spending, since the legislature refuses to raise taxes. So Texas is getting smaller gov't (and fewer services) simply because it cannot afford them.
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