The Essence and Future of Texas vs. California

I know there have been a lot of articles and references to Texas vs. California recently in this blog, but, well, there's a new one with some genuinely new contributions to the argument ("America's Future: California vs. Texas", Trends magazine, hat tip to Jeff). And it says some nice things about Houston too, so how can I pass on it? The beginning of the article is here - including an overview of both states' situations - but here are some key additional excerpts:

...Both the Brookings Institution and Forbes Magazine studied America’s cities and rated them for how well they create new jobs. All of America’s top five job-creating cities were in Texas. It's more than purely economics and regulation can explain, though. Texas – and Houston in particular – has a broad mix of Hispanics, whites, Asians, and blacks with virtually no racial problems. Texas welcomes new people and exemplifies genuine tolerance. When Hurricane Katrina hit, Houston took in 100,000 people. Not surprisingly, Houston has more foreign consulates than any American city other than New York and Los Angeles.
...
But, how did this happen? What’s wrong with California, and what’s right with Texas? It really comes down to four fundamental differences in the value systems embodied in these states:

First, Texans on average believe in laissez-faire markets with an emphasis on individual responsibility. Since the '80s, California’s policy-makers have favored central planning solutions and a reliance on a government social safety net. This unrelenting commitment to big government has led to a huge tax burden and triggered a mass exodus of jobs. The Trends Editors examined the resulting migration in “Voting with Our Feet,” in the April 2008 issue of Trends.

Second, Californians have largely treated environmentalism as a “religious sacrament” rather than as one component among many in maximizing people's quality of life. As we explained in “The Road Ahead for Housing,” in the June 2009 issue of Trends, environmentally-based land-use restriction centered in California played a huge role in inflating the recent housing bubble. Similarly, an unwillingness to manage ecology proactively for man’s benefit has been behind the recent epidemic of wildfires.

Third, California has placed “ethnic diversity” above “assimilation,” while Texas has done the opposite. “Identity politics” has created psychological ghettos that have prevented many of California’s diverse ethnic groups and subcultures from integrating fully into the mainstream. Texas, on the other hand, has proactively encouraged all the state’s residents to join the mainstream.

Fourth, beyond taxes, diversity, and the environment, Texas has focused on streamlining the regulatory and litigation burden on its residents. Meanwhile, California’s government has attempted to use regulation and litigation to transfer wealth from its creators to various special-interest constituencies.

They go on to make six forecasts:

  1. ...expect to see California’s loss of jobs to Nevada accelerate...
  2. ...expect to see a backlash in California and across the country against regulations, especially green initiatives that can’t clearly demonstrate a positive ROI...
  3. Watch for the smart money, including venture capital, to begin migrating to Texas for start-ups in many areas, including energy, info-tech, manufacturing, and biotech. Just as Delaware’s tax laws once encouraged numerous businesses to incorporate there, even when they had no connection to the state, Texas will become a magnet for new businesses by offering cheap land, a favorable regulatory environment, a business-friendly culture, and a large supply of skilled labor. Unless California revamps dramatically, expect to see its economy languish, even as the recovery takes off.
  4. To make its business climate even more business-friendly, Texas will invest heavily in secondary education and work hard to attract the best talent to its research universities (note the recent Tier 1 proposition and funding). Keep an eye especially on the University of Texas, which already has a first-rate campus and faculty. Within 10 years, UT, as the locals call it, may well rival Stanford or Berkeley.
  5. Other states will adopt tort reform measures pioneered in Texas. Unlike California and most other states, Texas has been aggressive in minimizing the enormous burden of frivolous lawsuits...
  6. Look to Texas to become a cutting-edge cultural mecca. Houston has always offered a vibrant cultural scene, ever since the Alley theater company was founded there in 1947 by Nina Eloise Whittington Vance. In the 1950s, John and Dominique de Menil moved to Houston with one of the most significant private collections of art in the world and began donating art and money to the Houston Museum of Fine Arts. Both institutions have grown to world-class status since then. In the coming years, this trend will spread to the major cities of Texas (take that, Dallas!), attracting the best talent and money and shifting the cultural balance of the nation away from New York and San Francisco.

I can personally vouch for #5. I was just visiting my brother out in CA, and a friend of his with a small store was being hit with a large disability discrimination lawsuit for a minor oversight (handicapped parking was marked on the ground and had the requisite walkways and ramps, but lacked a pole sign). Evidently this has become a cottage industry in California, where lawyers guide the disabled through stores looking for very minor violations of a vague law (things like high shelves or tables), then sue (expecting a quick settlement, of course). Under CA law, discrimination guilt is assumed if there's anything in the store the disabled can't do that a normal customer can do, regardless of the availability of employees to provide assistance. His friend was clearly exasperated with the unwinnable situation. Just plain nuts.

As Jim Goode says, "You might give some serious thought to thanking your lucky stars you're in Texas."

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The property prices alone

The property prices alone make me want to move back to Texas. I couldn't believe the differences when moving from Murietta California to San Antonio Texas. I still wanted to move back to San Diego as soon as I started the drive, but after comparing what I could get for the money, Texas wasn't so bad after all.

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An ecellent report.

An ecellent report. According to the latest report, the above study still remains accurate as our of the 50 US states performing well economically as assessed by various criteria, Texas comes at number 36 whereas California at number 49, that is among the wrost performers.

Wyoming comes in first, with the highest high school completion rate, sixth lowest debt per capita and second lowest poverty rate. But there are blemishes. Wyoming ranks 19th in median income and 32 second health coverage. With just over half a million residents, it is the least populous state.

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A native Californian myself,

A native Californian myself, I unfortunately have to agree with the outlook presented in this article. I spent a long time selling Alert One safety monitors door-to-door, and even being self-employed, it's amazing how hard it is to successfully run a business in CA. Texas really does understand *people* better, and their tendency to assimilate rather than glorify helps a lot as well.

America should be run more

America should be run more like Texas? That already happened, eight years of George W. Bush.

Regardless of your opinion of Bush, any success he had as governor he was unable to replicate at a national level.

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A lesson in TEXAS government

Although many people are Bush h8rs lets put that aside and learn something.

While majority of states in the union imitate the US constitution by allowing a governor to appoint different offices of government, Texas puts that decision in the hands of the people. There are many examples of a Republican Gov. and Democratic LT. Gov on the same term. Also all other officials, i.e. Attorney General are elected by the public not by appointment. This allows for people to perform their jobs without fearing wrath of one mans agenda as the federal government generally allows. Also, people in Texas believe too much government messes things up thats why representatives meet every 2 years.

Having a different framework and rules to work under can't replicate the successes here with the whole union.

Hispanic vote....

Hispanic vote will change dynamics of Texas...

Voting dynamics wont change

Texas has been part of six countries one of them being Mexico. We have more roots, music, culture and BORDER with Mexico than any other state. I'm white and for Xmas eve before midnight mass as a kid we had tamales w/ chili & rice. So you see you see hispanic but deep down we all simply Texans.

what are you talking about?

cdronk--

Huh? What do you call the miles of Gulf Coast, with long stretches of beautiful beaches--especially around Corpus Christi/Padre Island?

I've lived in both states, and Texas wins hands down. My son was born in Dallas, and (unlike his father) is a huge Cowboys fan.

I agree with all of the author's predictions, and will go one step further: eventually someone will bring either an antitrust or RICO suit against the State of California for restraint of trade insofar as its energy regulations on vehicles and appliances are imposed on the other 49 states by virtue of California's size. I resent having my choices limited by a radical legislature which doesn't represent me!

I am a business owner in California

It makes me sad how difficult it is to run a business in California. The thought of moving to Texas is pretty depressing (sorry Texas). I love living near the ocean and the lifestyle that brings.

I have a business that offers business loan alternative (http://businescashadvanced.net) and the taxes are killing me. It is as if I am being punished for contributing to my community.

I have recently started looking into the idea of moving to Texas. We'll see.