The State of Texas has been remarkably successful in attracting businesses, persuading folks all across the country to vote with their feet, and retaining a vibrant young population. As the chief financial officer of this great state, I look around and marvel at what smart and thoughtful policies by real conservatives have achieved.
How and why has it happened? It was not by accident. About twenty five years ago in the late eighties, we suffered through a very difficult recession, and faced up to some lessons painfully learned.
First, we had to diversify our economy. We have done so. Yes, we love our energy sector which is booming, but we are also strong in high tech, financial services, and health care and education. Second, we had to be prudent with our cash. We have done so. We have a rainy day fund which is full of proceeds from our booming oil and gas sector.
But perhaps most importantly, we knew we had to take a look at what helps businesses thrive and we had to check out our welcome mat.
Adam Smith who revolutionized economic philosophy in 1776 argued eloquently for letting individuals make the most of their own efforts. He was right and so is Texas.
We have been fortunate to have Republican leaders in the last 20 years who understood risking capital requires a light regulatory and reasonable hand by the state. Capital will and does flee a hostile environment.
California is a great example of what not to do.Toyota and numerous other companies are packing up and moving eastward. We are the fortunate beneficiaries of the failed policies in California, which ought to be a wakeup call.
Look elsewhere around the country.The new management in Detroit is trying to reverse decades of failed policies. Chicago and Illinois are similarly burdened. Blue states which regulate too much, charge too much through taxes and fees, and squander other people’s money aren’t a pattern to emulate.
In Texas we want you to risk capital. You risk capital when you invest it – and changing the rules in the middle of the game, whether through modifying tax policy or regulatory framework, can be unsettling. We want to reward the entrepreneurial spirit not chase it away.
My own great grandfather came here in 1859. He got here as quick as he could. They embraced change and accepted challenges, like so many of those early pioneers, and the ones who are using UHaul to pioneer their way here today. And the so called UHaul Index shows prices rise where there is the most demand. A truck going from California to Austin is more than double going the other direction. Same for New York to Austin, or Detroit to Houston. There is a common thread here, and it is stitching together a great new garment for my home state.
Texans today still risk capital and they flourish. More than 1.9 million jobs were created in the last ten years – more than California, New York and Florida combined. And we’re doing this at all pay levels, according to analysis by the Federal Reserve Bank in Dallas.
Ask a recent Californian about house prices in Texas, and you get a big smile. That’s because they get a great house for a rational price. And welcoming neighbors. We’re friendly here. In fact we even wave from our trucks and cars at total strangers all across our rural roads. That’s because we’re all one big family, understanding that we are at the new frontier of private enterprise.
We believe states can be great laboratories of invention, rather than demanding a top down federal management style which is well known to cramp investment style. Just ask a CEO of a major corporation whether he knows exactly what the cost to his bottom line will be through the new federal health plan and you won’t get a response. He doesn’t know because it isn’t knowable. That doesn’t work well for CEOs or families or anyone trying to manage their financial destiny.
Texans are proud of their state and their success. But let me reiterate. Creating the climate of welcome didn’t happen over the last two decades by accident.
Thoughtful, principled, conservative Republican leaders made it happen by opening doors and getting out of the way. We’re the better for it. The wealth of our nation and state is built by the people not the government. People are in fact building it right here in Texas.
We have operators standing by to help you find a realtor.
SUSAN COMBS is Texas Comptroller of Public Accounts.