Another Texas vs. California roundup:
— Red State Women (@RedStateWomen) July 23, 2014
Another Texas vs. California roundup:
— Red State Women (@RedStateWomen) July 23, 2014
Enjoy Independence Day tomorrow. In the meantime, here’s another Texas vs. California roundup:
“San Bernardino, California, said that to exit bankruptcy it must terminate a union contract that pays an average annual salary of $190,000 to each of its top 40 firefighters,” according to an article in Bloomberg. That’s just salary. Firefighters receive the generous “3 percent at 50″ retirement package that allows them to retire with 90 percent of their final years’ pay at age 50. And there are lots of pension-spiking gimmicks and other benefits on top of that.
“These cities are run for the benefit of those who work there. Public services are a side matter at best.”
Toyota’s move to Texas is a high-profile relocation, but Texas has been used to adding — and filling — new jobs at a superlative pace. The state added more than 1.9 million new jobs over the period from December 1999 to April 2014, more than 35 percent of the entire nation’s total for that 15-year period, noted Michael Cox, an economics professor at Southern Methodist University in Dallas. And Texas had an unemployment rate of just 5.1 percent in May, 16th-lowest in the United States.
Meanwhile, Cox noted, Texas’s median wages are 28th-highest in the nation; and they rank 8th-highest after adjusting for taxes and prices. Texas schools rank 3rd, he said, after adjusting for variations in student demographics, a raw statistic which places Texas 28th in the nation.
“We’re able to accomplish all this and more because the business environment in our state is largely competitive, and free markets solve problems,” Cox told me. “Texas is a meritocracy, where incentives still work to produce good results.”
Drive almost anywhere in the vast Lone Star State and you will see evidence of the “Texas miracle” economy that policymakers like Gov. Rick Perry can’t quit talking about….
This hot economy, politicians say, is the direct result of their zealous opposition to over-regulation, greedy trial lawyers and profligate government spending. Perry now regularly recruits companies from other states, telling them the grass is greener here. And his likely successor, Attorney General Greg Abbott, has made keeping it that way his campaign mantra.
It’s hard to argue with the job creation numbers they tout. Since 2003, a third of the net new jobs created in the United States were in Texas. And there are real people in those jobs, people with families to feed.
But the piece also notes that Texas has led the nation in worker fatalities for seven of the last ten years. I’m not going to get into the details of worker compensation that make up the bulk of the piece, and it is quite possible there is some room for improvement in worker safety. But I do want to note that, as the second largest state in the union, and the one with the biggest oil and gas industry, it’s not terribly surprising that Texas would have the largest number of fatalities, since oil and gas has a fairly high fatality rate (though not injury rate) compared to other industries (see page 14 here).
I see that #NoMoreAusterity is trending on Twitter this morning. It seems the usual leftist protest sorts are rallying against the Cameron government’s “austerity.”
The only problem is it doesn’t exist.
Real austerity is cutting government spending until it matches receipts. Under David Cameron, deficit spending has merely gone from 11.4% of GDP in 2010 to a projected 5.8% in 2014. So the UK government hasn’t practiced austerity, it’s merely slowed the rate at which it’s digging its own grave.
For the protestors, this simply will not do. They want government to give them things, and if it means having the moribund economies of Greece and Spain, so be it.
But unlike Greece and Spain, the UK won’t be able to get Germany to bail them out, nor to hold down the hyperinflation that is the inevitable endpoint of excess deficit spending.
Believe it or not, there seem to be a few actual glimmers of sanity in California in the latest roundup:
There seems to be some confusion over Texas Public Policy Foundation numbers for Texas budget estimates. Take, for example, this post by Erica Grieder. (She seems to be sharing space on Burkablog with the titular liberal fossil; I’m going to assume it’s a Sith-apprentice sort of thing…) She accuses TPPF of walking back their estimate of a 26% increase back to a more modest 9% increase.
The problem is she’s comparing apples to oranges by comparing their numbers for the amount appropriated by the legislature, which increased by some 26% between biennium, as opposed to the total amount spent, which increased by a far more modest 9%.
Here’s a chart:
Here’s an in-depth report by Talmadge Heflin, Vance Ginn, and Bill Peacock that explains it in more detail, including such budget arcana as “backfilling” and “patient income funds.”
Here’s a table containing the actual numbers. Remember that there are multiple line items that don’t get included in the “official” legislative budget document.
Here’s an editorial by Heflin and Arlene Wohlgemuth explaining it further.
Now, I do have one criticism of TPPF: All those documents I linked separately above should be boiled down into a single document. Flannery O’Conner once said “To the hard of hearing you shout, and for the almost-blind, you draw large and startling figures.” To which I add “For members of the press, you put key information in the front of the document is visual form so even the skimmers can comprehend it.” Asking some members of the press to look in four places for key information is simply asking too much of them. Especially if there’s drinking to be done, or interviewing another liberal interest group for pull quotes about the perfidious evil of Republicans.
Ideally there should be a spreadsheet or table near the front of that document with columns showing information just the 2012-2013 and 2014-2015 Bienniums and the % change between them with the following rows of information:
That sort of thing would go a long way toward clarifying state budget expenditures for people who would otherwise protest that they told there would be no math.
Lots of news on the Texas vs. California front. An audit turns up $31 billion in California budget mistakes, Democrats hike the minimum wage there, Jerry Brown tries to do something about the growing CalSTARS pension deficit, and people and businesses continue to depart the “Golden State” for Texas…
The California Bureau of State Audits set off a scandal on June 1st by disclosing that the State Controller’s Office made accounting misstatements amounting to $31.65 billion. The timing of the announcement may be devastating to the Democrats who expected to use their super-majority to pass billions of dollars in increased spending, but may now find the net effects of the accounting restatements are a $7 billion General Fund deficit.
As the former Treasurer of Orange County, California it is my preliminary judgment that under state law the negative $7.847 billion impact from overstating general fund assets and revenues and overstating deferred tax revenues may create an “on-budget” deficit to the state’s $96.3 billion “General Fund Budget.”
Union-dominated states are sinking further into economic stagnation as Democratic politicians increasingly dominate the local political climate. In 2012, California Democrats won a supermajority in both houses of the legislature and proceeded to accelerate a tax and spending spree that has been ongoing for two decades. For example, California now has the nation’s top state income-tax rate, at 13.3 percent.
Those kind of policies have consequences. The Manhattan Institute released a report in 2012 that found that since 1990, California had lost nearly 3.4 million residents to other states with lower tax rates.
The U.S. is swiftly becoming a tale of two nations. States that are following the Reagan model of low taxes and incentives are booming while states that are opting for the Obama model of wealth redistribution and European welfare-state economics are stagnating.
As a growing number of Americans choose to call Texas home, it is critical that policymakers not lose sight of the reasons why: low taxes, limited government, and personal responsibility. Liberty is popular. That’s a message that needs reinforcement, particularly at the local level where some of the macro level trends involving taxes, spending, and debt are moving in the wrong direction. We can keep Texas and our cities beacons of prosperity and flourishing — but to do that, we must understand the principles that got us here, and defend them in policy and the public square.
Time for another Texas vs. California roundup:
“Texas is the best state for business and I don’t see anything to slow TX down. The education and quality of eligible employees is excellent right now. Business is booming and growing quicker and more rapidly in 2014 than any other year. It’s an exciting time in Texas.”
“California goes out of its way to be anti-business and particularly where one might put manufacturing and/or distribution operations.”
“California continues to lead in disincentives for growth businesses to stay.”
“California’s attitude toward business makes you question why anyone would build a business there.”
“California could hardly do more to discourage business if that was the goal. The regulatory, tax and political environment are crushing.”
California v. Texas in One Chart: More Housing Starts in Houston from 2011-2014 than the Entire State of California pic.twitter.com/hO5RetaTae
— Mark J. Perry (@Mark_J_Perry) May 10, 2014
Then factors that appear to explain from 13 percent to 30 percent of the differences in trust among the states: rate of union membership,with more trust in states with lower union membership; state’s level of soft tyranny, a measure of the power of state government over its people; percentage of state and local taxes as a share of income, with lower taxes leading to more trust; the right to keep and bear arms, with citizens trusting a government that trusts them to defend themselves; a business-friendly lawsuit climate; the days the legislature is in session, with less trust as the legislature approaches full-time; and the average commute time, with less time spent in traffic leading to more trust.
Lastly, a combination of from two to four of the previous factors correlates to 34 to 41 percent of the trust in each state with a mix of four: taxes, gun rights, lawsuit reform and commute time, showing the highest link to trust. Comparatively speaking, Texas lawmakers have done well in these four areas of public policy.
When building trust in state government, enacting liberty-minded legislation is a good place to start.
Big news, as one of the world’s largest car makers decides to abandon tax-and-spend California for the Lone Star State:
California has become infamous with business executives and owners there not only for high tax rates and complex taxing schemes but also for overzealous regulations and regulators that have managed to stifle the entrepreneurial energy of thousands of companies.
Today sucks if you still have to finish your taxes. It sucks more in California than Texas, since you have to pay state income taxes as well. That includes a marginal tax rate of 9.3% for all those millionaires making more than $49,774 a year. As opposed to Texas’ marginal rate of 0.0% for all…
Texas and Washington offer low corporate income tax and no personal income tax, while providing a stable business climate and skilled work force. Many high-profile corporations have relocated their operations to new states. Recent examples include Northrop Grumman, which moved its headquarters to Northern Virginia; Raytheon Space and Airborne Systems, which moved its headquarters to McKinney, Texas; and Boeing, which moved two aircraft modernization programs, for the C-130 Hercules military transport aircraft and the B-1 bomber, from Long Beach to Oklahoma City.
The state teacher pension fund, CalSTRS, needs an extra $4.5 billion each year for 30 years to pay off its unfunded liabilities. CalPERS’ local government members will see costs increase by 50 percent during the next six years. And the state needs to contribute $1 billion more per year for retiree health care benefits.
These obligations for benefits already earned must be paid, and over the next decade, they will continue to drain funding from essential services such as education, public safety, transportation and health care.
Yet, powerful interests remain all too eager to kick the can down the road and push our pension problems onto future generations.
Time for another roundup of Texas vs. California:
The California city of Vallejo emerged from bankruptcy just over two years ago, but it is still struggling to pay its bills.
The main culprit: Ballooning pension costs, which will hit more than $14 million this year, a nearly 40% increase from two years ago.
Amid threats of legal action from the state’s pension giant, CalPERS, Vallejo did little during its nearly three-year stint in bankruptcy to stem the growth in its pension bills.
Now when I think about California, I think of a liberal oppressive police state and regulations and taxes and fees. I’d rather go someplace and have my own little place out on the edge of town. I’m a country girl at heart. It makes me happy when I see people in Texas open-carrying. It makes me feel safe. I’m not even a gun owner, but I’d like to see a gun rack in every pickup truck, like my boyfriend had when I was fifteen years old in Florida. An armed society is a polite society.