Texas, California and New Mexico

 

In July, the Economist magazine published a comparison of two states.  In “California v. Texas:  America’s Future,” they detailed the differences between the two state’s governance.  Texas has bet its future on low taxes, no state income-tax, fiscal restraint and regulatory reform.  The California legislature has gone the way of spending on entitlements, public services and increased regulation in the environmental sector.

 True to form, Texans believed a free market would produce economic prosperity. The California special interest groups pushed for an activist government which they believed would spur growth and a healthy, green society.  But in 2008, the dance was over and it was time to pay the fiddler.  State spending had grown to 102.9 billion, the treasury was broke, Californians were saddled with excessive taxation and businesses were burdened with expensive regulations.

 One of America’s most dynamic economies, California has moved from prosperity under Governor Reagan and budget director Vern Orr to a fiscal basket case. Over 100,000 residence leave each year, which includes high state revenue producing corporations choosing to relocate to a more business  friendly  environment.  California’s unemployment rate in June was 11.6%.

 On the other hand, Texas balanced its budget and has maintained a surplus. The Wall Street Journal, says Texas is largely unaffected by the recession and grew by 150,000 population last year. More Fortune 500 firms are based in Texas than any other state and seventy percent of all new jobs in America were created in Texas last year.  In June, Texas had only 7.6% unemployed.

 Texas and California have much in common.  They are both agriculture states, homes for technology based industries, energy producers, occupy large land masses with abundant natural resources and until recently have had expanding populations with many illegal immigrants. Both also achieved autonomy from Mexico and became republics before joining the Union.

 New Mexico, while a Territory and never a republic, shares many similarities with Texas and California; technology, natural resources, energy production, vast land mass and similar demographics. Yet New Mexico’s population has never grown at the rate of her sister states. New Mexico seems never to have found the formula for economic prosperity and never adopted an economic model and quest for prosperity and growth.

 New Mexico’s entrenched politicians  have focused on obtaining entitlements instead of creating economic opportunity.  Our number one natural resource and industry – energy – has been the primary source for revenue to fund government and government has been the primary employer. The green thing has wrongly usurped the technological agenda and is leading us like California, into more debt and unemployment, while stifling the primus cash cow. This is not a model for success, but many of our politicians seem bound to the same old patron system used in days of old, sprinkled with some new age green hocus-pocus. Corruption abounds as a way of political life and citizens sit back, acquiesced into believing things will never change.

 Our serious economic times call for policy makers to do some serious soul searching as to our direction.  The Rio Grande corridor is an excellent economic opportunity waiting to happen.  State and local officials need to rethink their positions on excessive regulations and create a business friendly atmosphere to enhance private sector employment.

 Though the states are similar in many respects, the policies of Texas and California could not be more different in ideology.  The Texas model has prospered her people and the California model has created a deficit and taxed her residents and businesses beyond their ability to stay.  The Texas model has worked and should be viewed by both New Mexicans and our politicians in Washington as something worthy of emulating.

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