- Joined
- Apr 30, 2014
- Messages
- 4,810
- Reaction score
- 2,250
- Location
- is everything
- Gender
- Male
- Political Leaning
- Liberal
These days, though, no one is talking about the lessons California should learn from Texas. California's economy is improving, and its budget is finally balanced — partly because of budget cuts and a voter-approved tax hike in 2012, and partly because the stock-market boom has translated into more tax receipts from California's wealthiest residents (the ones with those high income-tax rates). These changes happen to come as Texas, the nation's biggest oil-producing state by far, is grappling with a collapse in oil prices, which has depressed the price of a barrel of West Texas Intermediate crude oil to under fifty dollars a barrel for the first time in more than five years. It will be several months before the government publishes figures on GDP and business creation for the period coinciding with the drop in oil prices, but already there are signs of trouble. Michael Feroli, the chief U.S. economist at JPMorgan Chase, said in December, "We think Texas will, at least, have a rough 2015 ahead, and is at risk of slipping into a regional recession." The Texas budget, too, could be hurt by lost oil and gas taxes.
The concerns about Texas' fortunes speak to a misperception of the state's recent boom, and of California's bust. Texas' outperformance of California had a lot to do with factors beyond the control of politicians like Perry and Newsom—namely, the importance of real estate to California's economy, and the importance of oil to Texas. In 2008, the real-estate and rental-and-leasing sectors were responsible for about sixteen per cent of California’s GDP, almost double the proportion in Texas. So it was inevitable that California was hit harder by the housing crash that sparked the recession than Texas was. At the same time, Texas benefited disproportionately from a rise in oil prices in recent years. Oil and gas extraction makes up about eleven percent of Texas' economy, compared with one percent of California's. In 2008, the year the recession began, the price of a barrel of West Texas Intermediate crude oil hit a record, topping a hundred and forty dollars a barrel; the price fell later that year, but it recovered relatively fast, reaching a hundred dollars again by 2011. Mark Muro, the policy director at the Brookings Institutions Metropolitan Policy Program, told me that the recent natural-gas boom, coupled with rising oil prices, has been largely responsible for Texas' growth, in GDP as well as in employment and new business establishments, since the recession. The role of policy measures like low taxes and the light regulation of businesses was probably overstated, he said. — "How California Bested Texas," The New Yorker, Jan 8, 2015
The concerns about Texas' fortunes speak to a misperception of the state's recent boom, and of California's bust. Texas' outperformance of California had a lot to do with factors beyond the control of politicians like Perry and Newsom—namely, the importance of real estate to California's economy, and the importance of oil to Texas. In 2008, the real-estate and rental-and-leasing sectors were responsible for about sixteen per cent of California’s GDP, almost double the proportion in Texas. So it was inevitable that California was hit harder by the housing crash that sparked the recession than Texas was. At the same time, Texas benefited disproportionately from a rise in oil prices in recent years. Oil and gas extraction makes up about eleven percent of Texas' economy, compared with one percent of California's. In 2008, the year the recession began, the price of a barrel of West Texas Intermediate crude oil hit a record, topping a hundred and forty dollars a barrel; the price fell later that year, but it recovered relatively fast, reaching a hundred dollars again by 2011. Mark Muro, the policy director at the Brookings Institutions Metropolitan Policy Program, told me that the recent natural-gas boom, coupled with rising oil prices, has been largely responsible for Texas' growth, in GDP as well as in employment and new business establishments, since the recession. The role of policy measures like low taxes and the light regulation of businesses was probably overstated, he said. — "How California Bested Texas," The New Yorker, Jan 8, 2015
>>SSE doesn't create mass dependence, unsustainable debt and capital flight, all the things that people like you claim are good for this Nation.
SSE creates severe recessions, high unemployment, and massive debt. The Right constantly lies, claiming that liberal social programs create large deficits. Where are the numbers to back that up? They don't exist.
Very large revenue shortfalls 1982-83 and 2001-03 led to very large deficits 1982-86 and 2001-05. Unemployment was above seven percent from Jan 1981 until Oct 1986, and above eight, nine, and ten percent for long stretches of that seventy-month-long stretch of misery for the American people. Finally, the dangerous and irresponsible deregulation of the financial sector produced the astronomical deficits 2009-12 as a result of the GOP SSE Great Recession that wrecked the lives of millions of families.
>>So no its doesn't work for the Democrat party who's only hope is to create dependence, not jobs.
14.8 million full-time, private-sector jobs added since Dec 2009. Have a Texass-sized suck on that.
