If Texas points to the future, what lessons does it offer? One is that its leaders understood earlier than most that companies and people are mobile. Rick Perry, a former governor, went on “hunting trips” in search of business prey in other states; Greg Abbott, today’s governor, has followed suit. Covid-19 highlighted the attractions of a state which was quicker to leave lockdown than many others, such as California, and boasts a cheaper cost of living and fewer restrictions. Texas has offered some incentives to firms, but much of the growth has been down to the lure of a place with no income tax, lots of land for expansion, less red tape and a pro-business attitude. Granted, liberals and moderates abhor the state’s shrill, deep-red politics. Mr Abbott courts headlines by, for example, sending busloads of unauthorised immigrants to New York. Such stunts do not seem to have deterred many individuals or companies from moving to Texas, however; it remains to be seen whether recent draconian abortion laws will.
Another lesson from Texas is that nurturing one golden goose is not enough. The oil shock of the 1980s was painful, but the state has since diversified its economy. Finance and property have blossomed. The big cities all have different strengths: tech in Austin, energy in Houston, finance and more in Dallas. Instead of relying solely on oil and gas until the wells run dry, Texas has positioned itself on the cutting edge of new energy technologies (although listening to the rhetoric of the state’s politicians, you would not always know it). Places that have only one strong industry should start thinking about how they can use it as a platform to launch the next new thing.
The last lesson, however, is a cautionary one. For much of its history, Texas has had an exceptionally lean government. It has been loth to invest in the people and projects required for the future, including education and roads. Of late, as its formidable growth shows, it has got away with this. But the lean approach almost certainly has its limits, which it would be complacent to ignore.
Sometime in the 2040s, Texas is likely to pass California in population. Like it or not, America is becoming a bit more Texan every day https://t.co/qC2xA3B5ra
— The Economist (@TheEconomist) March 16, 2023