Californias situation proves that taxes and regulation matter.
By Byron Schlomach
Texas Insider Report: AUSTIN Texas When it comes to economic policy policymakers are increasingly looking to the two largest states in the nation as guides for what to do and what not to do.
California & Texas represent nearly opposite visions for how to achieve prosperity. The differences between the two states are stark.
Even though California is in an economic death spiral elected officials are looking for ways to:
- Tax carbon emissions
- Increase regulation and they have
- Basically refused to cut government spending.
Meanwhile Texas with its welcoming business environment of no income tax and lighter regulation is booming.
The differences between the two states are stark:
- The number of government employees in California has grown but Forbes magazine notes that the state has not produced a single net new job since 1998.
- Texas has grown the number of middle-income jobs by 16 percent while Californias grew by 2 percent.
- Even film production in California has declined markedly; 82 percent of all films were produced there in 2002 now its only 30 percent.
Texas now has more Fortune 500 companies than any other state.
California will find itself even more disadvantaged after the Panama Canal is widened in a couple of years.
Large retailers with shipments from China have been looking for new ports since a California longshoremans strike left goods sitting on docks just before Christmas several years ago.
Californias situation proves that taxes and regulation matter. Even natural advantages like a beautiful climate and a coast line can be neutralized by over-reaching government. States become and stay prosperous when the private sector is free to innovate and invest.
So the key to avoiding Californias fate is to borrow from Texass tax and regulation playbook.
Dr. Byron Schlomach is director of the Goldwater Institutes Center for Economic Prosperity.
Learn More:
Forbes:
California Suggests Suicide; Texas Asks: Can I Lend You a Knife?
American Legislative Exchange Council:
Rich States Poor States
The Economist:
California v Texas: Americas Future
By Byron Schlomach
Texas Insider Report: AUSTIN Texas When it comes to economic policy policymakers are increasingly looking to the two largest states in the nation as guides for what to do and what not to do.
California & Texas represent nearly opposite visions for how to achieve prosperity. The differences between the two states are stark.
Even though California is in an economic death spiral elected officials are looking for ways to:
