Lone Economic Star
What the rest of the country can learn from Texas.
Aug 2, 2010, Vol. 15, No. 43 • By ELI LEHRER
But additional factors, Cox and other analysts concede, have also contributed to Texas’s relative prosperity. To begin with, the highest property taxes in the country as a percentage of home value (about $2,200 a year on a typical house) made it difficult for developers to “bank” Texas land without building homes. Likewise, the inland locations of major Texas cities meant that they simply had more room to grow than ocean-hemmed metropolises like San Francisco and New York. Finally, huge public and private investments in the arts, parks, and universities have brought the state a large affluent professional class that would have once scorned Texas as a backwater.
In short, a state known for size and excess has succeeded because of public policies that avoided excesses of big government overspending, poorly conceived private lending, and business-government land planning. In this way, Texas offers important lessons for other states looking to claw their way out of the recession.
Eli Lehrer is the national director of the Center on Finance, Insurance and Real Estate at the Heartland Institute.