Economics 101: When government is friendly to business, business gets done and jobs are created

From, believe it or not, The Washington Post:

Texas isn’t just leading the nation in job growth — it’s doing it more equitably, too

Underestimate Texas at your own peril.

You might be inclined to think that the Lone Star state is bad at creating good jobs. It is, after all, second only to Idaho in the proportion of its population earning the federal minimum wage or less, according to the Labor Department. And it has the ninth-highest Gini coefficient, a measure of income inequality. So it’s only natural to assume that the state is bad at adding good jobs, right? Wrong.

Texas experienced stronger job growth than the rest of the nation from 2000 to 2013, according to the Federal Reserve Bank of Dallas. Not only that, a pair of researchers note in a Thursday research publication, but Texas leads the nation in creation of jobs at all pay levels, too.

“Texas has also created more ‘good’ than ‘bad’ jobs,” they write. “Jobs in the top half of the wage distribution experienced disproportionate growth. The two upper wage quartiles were responsible for 55 percent of net new jobs. A similar pie chart cannot be made for the rest of the U.S., which lost jobs in the lower-middle quartile over the period.”

We’ve written plenty about how the income gap has continued to grow in recent years and , and the same is true with jobs. Nationally, all the jobs created since 2000 were concentrated at the highest- or lowest-paying quartiles. In Texas, however, job creation was more broad-based.

More at the link.

Governor Rick Perry (R-TX) wowed ’em at the Conservative Political Action Conference this past week, and the Post article is evidence that the economic polices of the state of Texas are working a heck of a lot better than those of President Obama on the national level.

As our long-term readers are aware, your editor endorsed Governor Perry for the Republican Presidential nomination early on in the process. I still believe that Governor Perry is just the kind of man we need for President: a strong conservative with real executive experience, leading a state which has led the nation in job creation for several years.

Unfortunately, while Mr Perry might make a good President, it became apparent that he didn’t make a good presidential candidate: he flubbed up in several debates, and even though his debate performances got much better toward the end, the damage had been done. If President Obama has proved one thing, it’s that the qualities which make a great presidential candidate are completely divorced from those which make a good president. President Obama has been probably the best presidential candidate in my lifetime — he not only defeated the inevitable Hillary Clinton in the 2008 primaries, but won re-election despite very high unemployment and trillion-dollar deficits — and, at the same time, the worst president in my lifetime . . . and my lifetime includes Lyndon Johnson, Richard Nixon and Jimmy Carter! And Governor Perry proved that being a good governor does not make a person a good candidate.1

Simply put, job performance does not equal electability in the United States, and it seems highly unlikely that Governor Perry will be our next president, even though it is thought that he intends to run.

But the numbers are proving what sensible people have known all along: that Texas is doing a lot better economically than the rest of the country, and the conservative business and economic policies of the state — low taxes and a state government which is friendly rather than hostile toward business success — are at least part of the story.

  1. It should be noted her that Mr Perry didn’t win a gubernatorial campaign to become governor; he was the elected Lieutenant Governor when George W Bush resigned after winning the presidency in 2000. Mr Perry won subsequent gubernatorial elections in 2002, 2006 and 2010, but he was running as the incumbent. He has decided not to seek re-election this year.

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