Although the National Bureau of Economic Research declared that the Great Recession ended some time ago, the nation as a whole still does not have an economy to be proud of. Many states still have unemployment rates hovering around 9%, leading liberals and conservatives across the nation to debate the best way to rejuvenate the economy and create jobs.
No matter where your beliefs lie, one thing is certain: Texas has, and continues to be, an economic powerhouse. Texas suffered far less severely than the rest of the nation. The state’s unemployment rate has consistently been at or below the national average, even throughout the recession. It continues to create a substantial amount of jobs every year, and many people are studying the state to figure out just how it is doing so well.
We’ve compiled this list of of the ten main factors that contribute to Texas’ economic strength- many of which are aided by decisions made by the state government. The rest of the nation would do themselves a favor by following their lead.
- Wind energy. While Texas is known for having large amounts of oil, they have recently pioneered wind energy as well. This new industry alone has already added 10,000 jobs to the economy. Texas is able to do this through little regulation and its own electricity grid, something other states don’t have. The industry has the state government to thank for this robust energy grid.
- Embracing globalization. A key reason why Texas is prospering is through their acceptance and adaptation to globalization. Something many people overlook is that global trade actually increased during the recession- and Texas was there to capitalize on this. Texas exports far more than any other state, which only makes their economy stronger. The nation would do well to adopt this embrace of global trade.
- Minimizing business regulations. It’s no secret: businesses don’t like regulation by the government. Texas has strived to create an environment with as few restrictions and regulations as possible, meaning businesses have flocked to the state like bees to honey. Of course, this works out well for Texas, as it means yet more jobs added to their economy.
- A well-managed budget. With national debt rising to record highs, Texas, on the other hand, has been closing the budget shortfall by decreasing spending to match the money on hand. Of course, they did this without raising taxes. A cheaper government is part of what allows Texas to cultivate such an appealing business climate.
- Status as a right-to-work state. As if Texas didn’t attract businesses as is, the right-to-work status brings them in even more. Combine this the state’s with low taxes and minimal business regulations, and you’re close to paradise for corporations and other big businesses. This gives employers flexibility in meeting their workforce needs and keeps their costs low.
- Lawsuit reform. This is something nearly everyone can agree on- except for the possibility of lawyers. Expensive lawsuits cost businesses a lot of money, and taking excessive precautions to avoid them drags down the economy. By putting laws in place that end frivolous and frequent lawsuits, Texas has only boosted their economy.
- Inexpensive land and inexpensive houses. Due to an abundance of land combined with relaxed zoning codes, buying land in Texas is much cheaper than in other states. However, this isn’t the only reason. The Lone Star state has laws that prohibited consumers from using home-equity lines of credit to increase borrowing to more than 80 percent of the value of their homes. This prevented a housing bubble, meaning prices have barely increased since 2007.
- Texas doesn’t try to ‘buy’ a better economy. The good people of Texas realize that a solid economy runs well on it’s own- without government interference, no matter how good the intentions are. They recognize that even after pouring millions of dollars into programs designed to strengthen the economy, you may not see much of payoff. This is a valuable lesson for the rest of the nation.
- Cheaper cost of living. Through lower taxes across the board, including state and local taxes, Texans enjoy a cheaper cost of living than most other states. Less taxes leads to more spending which leads to more jobs.
- Low taxes draw businesses there. In line with the previous point, Texas attracts many businesses with it’s low taxes. Businesses want to run wherever their expenses are lowest, so they seek out states like Texas. It’s just good business.
Through simple conservative policies in nearly every area, Texas has fostered a powerhouse economy that is the envy of the nation. If the national government as well as other state governments took cues from their policies, the nation would surely profit.
This post has been provided by Goodwin & Scieszka