Booming Texas?

One winter ago when Corrie and I moved here to Austin from Brooklyn, Texas, as a state economy, was doing plenty better than the national average. In fact, along with Oklahoma, it had been adding jobs and building houses consistently during the downturn that forced so many states' home building sector to stagnate as well as the frightening overall job slough.

Texas was an attractive place for young professionals to relocate. There were not just jobs, but well paying technical jobs. Homes are cheap.

During this recent midterm election campaign if you were unfortunate enough to be exposed to our incumbent governor Rick Perry's political ads, you'd hear about how the Texas state government under Perry had squirreled away eight billion dollars to fend off whatever budget crunch might befall the great state of Texas.

Two things Perry failed to mention in those commercials were: 1) that the eight billion dollars was federal cash he had vowed not to accept; and 2) the "balanced budget" of Perry's gov't is going to have a fifteen billion dollar deficit ("balancing the budget" was a claim in his voice from the ad).

Texas doesn't have a state income tax, which is ballyhooed as a wonderful thing by working class folks from both parties. Unfortunately, those damn state income taxes help states weather tough economic cycles, and the rare states without income taxes have to rely more heavily on sales tax and property taxes. Relying on sales tax for revenue, which Texas is prone to do, is risky, and is more of a boom or bust scenario.

It took a little while, but it seems the downturn might have finally caught up with Texas. With so many people though, and a wide variety of tech, oil, and light industry work, I would guess that it won't be ravaged in the same manner as former manufacturing bases like the Rust Belt.

Homes are still cheap, but job creation has slowed to a crawl, and people keep moving here. It's bound to get interesting.