Why Texas is a job creation machine — and DC is not – Richard Rider – Open Salon
Let’s start with this 2 minute video which offers fascinating insight into the woefully ignorant political appointments that Obama is making. In a taped interview, the U.S. Secretary of Labor is STUNNED to discover that Texas is creating jobs like crazy — she literally had no idea about this.
You gotta see her laugh incredulously at the assertion, saying “Come again??” From there you get to watch a political deer caught in headlights — wishing she were elsewhere. I suspect that any Democrat watching this video feels the same way.
TheBlaze: Texas for Dummies: U.S. Labor Secretary Hilda Solis Doesn’t Know Texas Has Largest Job Growth in U.S.
Apparently trivial matters such as job creation don’t concern our SECRETARY OF LABOR, or the Obama administration (until last week, when Obama’s handlers belatedly realized that he’s up for reelection in 2012). In her mind, being unemployed (and politically beholden to a generous government welfare system) is FAR superior to, ya know, going to work.
All Secretary Solis really knew about Texas was that it’s a “right to work” state — which is ObamaSpeak for “a very evil place.”
Below is a more detailed analysis of the Texas jobs market. What is fascinating is the state’s large population influx, and yet Texas still has a significantly lower unemployment rate than the national average.
One knock on Texas jobs is that they supposedly pay so little. Two problems with that criticism:
1. The cost of living in Texas is far lower than what most of our country’s population face — comparable housing costs less than half what Californians pay, and there is no state income tax. It takes less income to live comfortably in Texas than in the Democrat bastions around the country.
2. According to the WALL ST JOURNAL, the U.S Bureau of Labor Statistics (BLS) “pegs the median hourly wage in Texas at $15.14, 93% of the national average, and wages have increased at a good clip: in fact, the 10th fastest state in 2010 at 3.4%.” Not exactly Chinese slave labor wages.
Here’s another knee-jerk attempt to explain away the Texas job growth, and the factual rebuttal (from the same WSJ article):
“The Texas skeptics often invoke high energy prices, as if Texas were some sheikdom next to Mexico. But according to the Dallas Fed study, energy jobs accounted for only 10.6% of the new positions.”
Full disclosure — I’m not a big Rick Perry fan. I think there are better (if not more electable) GOP choices for President. But he’s so much better than Obama that it’s scary (scary for Dems, at least). Here’s the full WSJ article:
WALL ST JOURNAL
AUGUST 19, 2011
The Texas Jobs Panic
Liberals try to discredit the Lone Star State’s economic success
Rick Perry is not the subtlest politician, but he looks like Pericles next to the liberals falling over themselves to discredit job creation in Texas. We’d have thought any new jobs would be a blessing when 25 million Americans are looking for full-time work, but apparently new jobs aren’t valuable jobs if they’re created in a state that rejects Obamanomics.
Let’s dissect the Texas record. The Federal Reserve Bank of Dallas reported this summer that Texas created 37% of all net new American jobs since the recovery began in June 2009. Texas by far outpaced every other state, including those with large populations like New York and California and those with faster-growing economies, like North Dakota. Other states have lower unemployment rates than Texas’s 8.2%, though that is below the national average and the state is also adding jobs faster than any other.
In today’s Opinion Journal video: Editorial writer Joe Rago on Texas Gov. Rick Perry’s jobs record; and editorial writer Mary Kissel on Harvard law professor Elizabeth Warren’s potential challenge to Massachusetts GOP Senator Scott Brown.
Texas is also among the three states and the District of Columbia that are home to more jobs today than when the recession began in December 2007. Without the Texas gains, according to the Dallas Fed, annual U.S. job growth would have been 0.97% instead of 1.17%. Over the past five years, Texas has added more net new jobs than all other states combined.
The critics claim demography is destiny, and of course jobs and population tend to rise and fall in tandem. The number of Texans is booming: According to the Census Bureau, the population grew 20.6% between 2000 and 2010, behind only Nevada, Arizona, Utah and Arizona. According to the Bureau of Labor Statistics (BLS), the seasonally adjusted size of the Texas labor force has increased by 5% since December 2007, faster than any state other than North Carolina at 5.4%, though the Tar Heel State has declined 0.4% over the last year. The labor force has shrunk in 28 states since December 2007.
Some of this Texas growth is due to high birth rates, some to immigration. But it also reflects the flight of people from other states. People and capital are mobile and move where the opportunities are greatest. Texas is attractive to workers and employers alike because of its low costs of living and doing business. The government in Austin is small, taxes are low, regulation is stable, and the litigation system is more predictable after Mr. Perry’s tort reforms—all of which is a magnet for private investment and hiring.
As for the critics, well, one of their explanations is that Americans are moving to Texas because of the nice weather. The temperature in Fort Worth this week reached 108 degrees.
The critics also claim that Texas’s new jobs somehow don’t count because the wages are supposedly low and the benefits stingy. Yet BLS pegs the median hourly wage in Texas at $15.14, 93% of the national average, and wages have increased at a good clip: in fact, the 10th fastest state in 2010 at 3.4%.
The Texas skeptics often invoke high energy prices, as if Texas were some sheikdom next to Mexico. But according to the Dallas Fed study, energy jobs accounted for only 10.6% of the new positions. The state economy today is far more broadly based than it was before the early-1980s oil-and-gas bust. For the last nine years, Texas has led the states in exports.
To put a finer point on it, the energy industry isn’t expanding merely because of rising oil prices or new natural resources. Technological innovation is also driving the business, such as the horizontal drilling that has enabled shale oil and gas fracking. New ideas are how an economy expands.
Nearly 31% of the new Texas jobs are in health care, many of which are no doubt the product of federal entitlements that go to every state. But the state is also making progress filling in historical access gaps in west and south Texas and the panhandle, where Mr. Perry’s 2003 malpractice caps have led to an influx of doctors, especially high-risk specialists. The Texas Public Policy Foundation estimates that the state has netted 26,000 new physicians in the wake of reform, most from out of state.
Liberals do have a point that Texas avoided the worst of the housing boom and bust, in part because of regulations imposed in the S&L backwash that limit mortgage borrowing to 80% of the appraised value of a home. But isn’t this smart regulation? These same liberals promoted rules that kept down payments much lower than 20% at federal agencies, and they’re now encouraging the Administration to prop up housing to prevent foreclosures and thus prevent the market from finding a bottom.
Mr. Perry’s Texas record is far from perfect, as Charles Dameron recently showed on these pages with his reporting on the Governor’s politicized venture-capital fund. But the larger story is that Mr. Perry inherited a well-functioning economy and has managed it well, mainly by avoiding the kind of policy disruptions that his liberal critics favor in the name of this or that social or political goal. This achievement may not earn a Nobel prize in economics, but it does help explain why Texas is outperforming the nation.
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UPDATE: Here’s one other humorous factoid I picked up concerning our brilliant Secretary of Labor.
Hilda Solis demonstrated her stunning ignorance of her job when she didn’t know that Texas has had great success creating jobs. But at least she understands symbolism — she dumped her government SUV for an American-made Chevy — union worker solidarity and all that.
Only one problem — she bought a Canadian-built Chevy made from Canadian auto parts.
Oops.
Comments 11
FYI:
Texas-Size Recovery
http://factcheck.org/2011/08/texas-size-recovery/
Fact: Texas is responsible for 40 percent of the nation’s job creation since June 2009.
Fact: Despite the job gains, Texas’ unemployment rate has gone up.
Fact: The Texas economy has benefited from high fuel prices.
Fact: Texas didn’t experience the big housing bust.
Fact: Texas has benefited from an increase in government jobs, too.
Fact: Texas, along with Mississippi, has the highest percentage of hourly workers at or below the minimum wage.
In Texas, 9.5 percent of workers paid hourly rates earn at or below minimum wage. That gives the state the highest percentage in the nation, tied with Mississippi, according to BLS data.
Could this be the direction the country is going for workers in the future? Minimum wage?
And, I might add:
Lloyd Doggett says Texas has worse unemployment than 25 states and it’s tied with Mississippi for most minimum-wage workers.
http://www.politifact.com/texas/statements/2011/aug/16/lloyd-doggett/lloyd-doggett-says-texas-has-worse-unemployment-25/
Texas leads “the nation in the percentage of residents without health insurance.”
Paul Krugman on Thursday, January 6th, 2011 in an op-ed column
The “Lloyd Doggett” cited as a Texas authority above is
a former Democratic Congressman, and later lost to
Phil Gramm (R) for U.S. Senate from Texas in 1984.
Quite the SURPRISE Dogget would not approve of a GOP
Governor of Texas, like Rick Perry! The last time a
Democrat won for Governor or US Senator from Texas?
21 years ago in 1990 (Anne Richards for Governor).
Jim,
Do you have a response to any of the other points raised by Gwendolyn?
Alger _ I’ll respond to the “facts”
1. Considering Texas has less than 9% of the USA population, the fact they have produced 40% of the nations job growth, shows how horrible the rest of the country, especially California has been.
2. How much has the unemployment rate increased? Was it a slight increase or a large one? When is the time frame? Lets not forget, Texas also had the largest growth of residents of any state.
3. I do not know how higher fuel prices can help an economy. If you mean oil and gas prices, then so what. California is the 4th largest oil producer in the U.S., which hasn’t helped us a darn bit. Maybe , if we did not try to restrict production both onshore and especially offshore, we would do better, like Texas. Plus, let’s not bring up a tax on production, because, while Texas has one and California doesn’t, we remain the only state to include the value of reserves in calculating property tax, a boon to local, not state governments. Also, Texas does not have an imcome tax.
4. I would say that the Texas housing market over expanded like most places in the Sunbelt. The bust did not hurt them as much because people are moving there, unlike California, and their housing market was not on steroids, like California, largely because of regulations and restrictions on growth.
5. Yes, they have. Although were and what the jobs are is important. A place that has a lot of growth, will generally have an increase in government jobs, although it would be better if they were contracted out to the private sector.
6. Yes, they have a lot of minimum wage jobs. So what? A job is a job. There is a reason why there are reports of hundreds of people, individuals were college degrees and senior citizen apply for jobs at McDonald’s and Forever 21. Not every job will have hedge fund type pay.
Themarshallplan,
2. Any increase in unemployment runs contrary to the story being sold that Texas is a “job-creating machine.”
3. Texas has historically gone through booms and busts depending on the price of oil. It is not surprising that they are doing comparatively better during a time of high oil prices.
4. I think you missed the point. Regardless of the reason, the fact that housing prices have held up better in Texas is another important factor when doing comparisons.
5. Many states have been losing public sector jobs. If the goal is to create more private sector jobs (a very good goal, by the way), then we should compare the net gain, or loss, of private-sector jobs.
6. Tell me you are not serious. Can you support a family on a minimum-wage job and is that really the direction you want the country to go in?
Author
One knock on Texas jobs is that they supposedly pay so little. Three problems with that criticism:
1. The cost of living in Texas is much lower than what most of our country’s population face — comparable housing costs less than half what Californians pay, and there is no state income tax. It takes less income to live comfortably in Texas than in the Democratic Party bastions around the country.
2. According to the WALL ST JOURNAL, the U.S Bureau of Labor Statistics (BLS) “pegs the median hourly wage in Texas at $15.14, 93% of the national average, and wages have increased at a good clip: in fact, the 10th fastest state in 2010 at 3.4%.” Not exactly Chinese slave labor wages.
3. Yes, the Texas unemployment RATE has gone up. Only North Dakota has seen a drop in unemployment since the start of the recession.
But Texas has had a massive INFLUX of domestic migrants from other states — and the state’s unemployment rate is still significantly below the national average.
One the other hand, CA in the last decade has had a NET domestic out-migration of 1.5 million people, and still has the second highest unemployment rate in the nation — over 12%. Most people forget that until just 4 years ago CA had a LOWER unemployment rate (around 5%) than the nation.
BOTTOM LINE FOR DEMOCRATS: Being UNEMPLOYED is far better than being paid a relatively low wage to work. When unemployed people depend on the plantation (the govt) to take care of ’em. That dependency is fertile soil for Democrats.
Good Alger/RR point/counterpoint!
“Being UNEMPLOYED is far better than being paid a relatively low wage to work. When unemployed, people depend on the plantation (the govt) to take care of ‘em. That dependency is fertile soil for Democrats.”
What kind of logic is that, Mr. Rider?
How do you come up with such outlandish statements not based on fact?
Otherwise, you are making a statement of hyperbole.
Richard,
Working for low wages is certainly better than being unemployed especially in a down economy. The part that I find troubling is your cheerleading of policies that will ensure that many, if not most, of the new jobs created will continue to be low-paying.
Certainly, higher wages are ideal, and people should earn what they are worth. It is key though, not to lose sight of the first point in Richard’s most recent post re: cost of living.
While the dollar amount of the wages may be lower in TX than CA, the cost of living is as well, which results in a greater level of discretionary income. Would you rather work in CA, earn $20/hour and require $19/hour to live (saving $1/hour) or work in TX, earn $15/hour and require $12/hour to love (saving $3/hour)?
Alger, I agree with your point that it is troubling to hear that Richard is touting “policies that ensure that many, if not most, of the new jobs created will continue to be low-paying”.
It seems mean spirited and unrealistic to think that someone (as an example) with an MBA and a $50,000 education debt should forego looking for the best paying job just to flip burgers down the street and compete with a teen looking for work….just to lower the unemployment roles. Why would one apply for a job they are overqualified for? The purpose of unemployment is allowing job seekers more time in this market to find appropriate jobs matching their training.
From news reports I often hear that some have dropped off of the unemployment roles in lieu of returning to school to learn another skill that is marketable in our current market. They aren’t receiving unemployment…..and yet they are either unemployed or underemployed.