The Texas Model

April 14th, 2015

Thanks to our state’s traditional ‘can do’ approach to life and business, Texas has long been the preferred destination for risk takers and entrepreneurs, including two very intelligent leaders from Sweden I met at the South by Southwest conference. They had come to SXSW in Austin to learn more about the Texas model of economic success.

It was a real treat to meet with these two women – one a former member of the Swedish Parliament and the other the head of the Stockholm Chamber of Commerce. They were on a mission to discover why Texas is so successful and what makes us different from other states. After their visit to Austin, they were continuing their time in the U.S. with a visit to California. I assured them the contrast would be stark.

As a group of Texans from various walks of life sat around a conference table, the Swedes peppered us with questions about the essential differences between Texas and California in terms of state government. It didn’t take long for the topic of tax policy to come up, and they surprised us by saying their home country, clearly left-leaning and progressive, had reduced their tax rates and modernized a number of institutions. They generally felt Sweden’s economic punch was significant, and they clearly understood that Texas’ no income tax policy is a big magnet for businesses looking to relocate.

The head of the Stockholm chamber is focused on attracting businesses to their area and so her interest is obviously consistent with ours here at home. However, from what I gathered, Texas’ governmental policy structure is not really replicated anywhere in Europe.

The same could be said here in the United States. When entrepreneur Paul Murphy decided to uproot his tech company, Clarify, from England to America last year, he didn’t choose Silicon Valley. He chose Austin, Texas. In fact, Forbes recently ranked Austin above all other cities in …

Expanded government rules create regulatory swamps

March 24th, 2015

Published here

by Susan Combs

It always amazes me when someone in business supports an additional regulatory framework. Consider those brilliant folks in the high-tech sector who went along with the new Federal Communications Commission rules for so-called net
neutrality. Turns out it isn’t so neutral, and Commissioner Tom Wheeler launched an apology tour claiming they’re not going to impose new rules. Right.

What does this tell us? Left unchecked, the White House will keep turning the regulatory thumbscrews across a whole array of sectors, including one I know all too well — the Endangered Species Act.

Let’s do a quick review. The Endangered Species Act was imposed in 1973, modified slightly a few years later, and thereafter was expanded to encroach on the private property rights of millions of Americans through additional regulations, rules and opaque interpretations.

The act says that no one can “take” an endangered species, defined as “harass, harm, pursue, hunt, shoot, wound, kill, trap, capture or collect.” Additionally, “harm” now includes “significant habitat modification or degradation.” As a result, you can find yourself in jail and or face steep fines just for modifying your private property.

The act’s stated purpose was to conserve species facing survival hazards, but the metrics for success are, to say the least, unclear. Ideally, we should recover a species so the listing is no longer needed, but the federal government seems obsessed with its listings.

In the 40 years since the act’s passage, 2,225 species have been listed as either threatened or endangered. Of those, only 30 have been recovered. In my book, 1 percent is not much of a success rate, so the outcry to protect owls, snail darters and the like steers the conversation away from recovery.Can recovery be achieved? Yes. Environmentalists will be shocked to know it’s happened twice in Texas.

The first was at Fort Hood, which stood to lose 50,000 acres of training ground when …

America Needs the Texas Economy to Keep on Rolling

February 14th, 2015

by Joel Kotkin, Forbes

In the last decade, Texas emerged as America’s new land of opportunity — if you will, America’s America. Since the start of the recession, the Lone Star State has been responsible for the majority of employment growth in the country. Between November 2007 and November 2014, the United States gained a net 2.1 million jobs, with 1.2 million alone in Texas.

Yet with the recent steep drop in oil prices, the Texas economy faces extreme headwinds that could even spark something of a downturn. A repeat of the 1980s oil bust isn’t likely, says Comerica Bank economist Robert Dye, but he expects much slower growth, particularly for formerly red-hot Houston, an easing of home prices and, likely, a slowdown of in-migration.

Some blue state commentators might view Texas’ prospective decline as good news. Some, like Paul Krugman, have spent years arguing that the state’s success has little to do with its much-touted business-friendly climate of light regulation and low taxes, but rather, simply mass in-migration by people seeking cheaper housing. Schadenfreude is palpable in the writings of progressive journalists like the Los Angeles Times’ Michael Hiltzik, who recently crowed that falling energy prices may finally “snuff out” the detested “Texas miracle.”

Such attitudes are short-sighted. It is unlikely that the American economy can sustain a healthy rate of growth without the kind of production-based strength that has powered Texas, as well as Ohio, North Dakota and Louisiana. De-industrializing states like California or New York may enjoy asset bubbles that benefit the wealthy and generate “knowledge workers” jobs for the well-educated (nationwide, professional and business services employment rose by 196,000 from October 2007 through October 2014), but they cannot do much to provide opportunities for the majority of the population.

What’s Next

December 29th, 2014

by Susan Combs

As one year draws to a close, and we look ahead to the next one, most of us reflect back on what we did or did not accomplish. And then of course, we wonder about “what’s next.”

From the Lone Star Success perspective, things went very well for 2014 and we are off to a rousing start for 2015. And the momentum in Texas could be even stronger if we weren’t constantly fighting against the job killing headwinds coming from Washington and the federal government – regulatory change, tax modifications, and so on. So my hope for the New Year is that the folks in D.C. set ambitious goals that truly lead to job creation and expansion. When I read the stats about the percentage of the population that has a full time job, it is pretty dismal. Although in Texas we recovered all of our jobs in November of 2011, and have since added over one million more jobs, the overall US recovery from the Great Recession isn’t so great.

But there is hope that Washington rings in 2015 by starting a much needed conversation about tax reform with the goal of cleaning up loopholes, ensuring fairness, and giving employers a reason to expand hiring. Without jobs, families don’t move ahead, economic recovery slows and young people are stuck in their parents’ home for extended periods of time. I believe that if Washington follows the economic leadership of Texas, thousands of young people will have the opportunity to ring in 2016 in their own homes or apartments instead of their parents’ basements.

You see I, for one, am always an optimist. Being a rancher’s daughter makes me that way. My father’s income was subject to uncontrollable weather spikes and price fluctuations, yet he would always say “well, we’re one day closer to rain.” That is real optimism for you!

So let’s all urge and encourage the …

What This Election Means

November 7th, 2014

by Susan Combs

Tuesday in Texas and the nation was historic in several ways. The conservative fiscal message from Republicans resonated across the nation in surprising ways. The traditional ‘blue’ state of Illinois elected its first Republican governor in years, and a national electorate, driven by independents concerned about the economy and Washington’s gridlock sent Republicans to the U.S. Senate in what has been characterized as a ‘wave’.

In Texas, as had been widely expected, Republicans kept all statewide offices. What didn’t happen however was a ‘wave’ of voter participation. In fact it was down. Texas voter turnout fell from about 38% in our last midterm election to about 34% this year. I want to thank all of you who cast ballots, but I’m concerned that the participation isn’t higher.

The overall direction of this great nation was on people’s minds and they are worried. Voters are asking themselves, “Can we have a secure future for our kids? Or for that matter, for me?” Perhaps I am under employed, working in a position below my skills and experience level. I don’t seem to be getting ahead.

Or perhaps I am getting up in years. My income from a lifetime of saving is at a dismal level, and I don’t know what to do about it. And the folks in Washington seem clueless about how to fix an obvious problem.

But one thing is clear. While voters in Texas chose overwhelmingly to continue the leadership that has made Texas a Lone Star Success and the economic envy of the nation, the rest of the country wants a change because they need a change! And Washington has to deliver it. That means what?

First, look for solutions. Stop shifting blame. People of good will and intentions can in fact reach reasonable compromises. Yes, that newly terrible word ‘compromise’. I compromised with my kids when I let them have an extra tortilla chip …

We Know What to Do, Now Let’s Do It

October 29th, 2014

by Susan Combs

We do know what to do. We have to go vote. Early voting started a week ago and runs through Friday, October 31st. The ballot covers all kinds of issues: elections for city, county, state positions. Local debt packages are on ballots in your communities, along with big-ticket items dealing with transportation issues that affect every Texan. And much more.

The weather is nice right now over much of the state, so that shouldn’t let you dodge the “you’ve got to vote” duty. And yes, we all do have a duty to vote, if only to honor and pay respect to the men and women who, over the decades and centuries, have given so much to protect this essential part of our freedom.

But freedom comes with the personal cost of honoring our obligation. I went and voted on the first day, and I was chomping at the bit.

So, I voted early and I advise you to do the same. You still have until Friday and you will truly enjoy the satisfaction of a job well done. And because it is you, yes, YOU, who selects the people who serve in public office, don’t let someone else do it for you. That is what happens when you just sit it out on the sidelines. Just go and do your job – after you have considered the facts, the people and the issues. Be informed and then be a good citizen.

In the last few weeks, we’ve created a series of videos that we hope have highlighted some of the reasons that conservative fiscal leadership has made Texas the economic envy of the nation.

We’ve talked about:

Texas’ Unrivaled Job Growth

Affordable Housing

A Robust Rainy Day Fund

Protecting Your Piggy Bank from a State Income Tax

Our Business Friendliness

And the video we released last week gives a good summary of what some other states (Gee, …

Take a Stand

October 20th, 2014

by Susan Combs

We appear to have become a nation of folks sitting. Sitting on the sidelines. Sitting in front of TVs, our phones or tablets. We sit things out.

But we weren’t always a nation of sitters. The United States is an amazing experiment in political thinking. It is a republic based on democratic principles – one man, one vote, liberty, and freedom. We stood together and fought a revolution for the right to vote and determine our future. We seized our future.

What if we don’t go vote? We are extraordinarily lucky in 2014 to be able to go calmly to a voting area, walk in, and vote. No need to worry about armed thugs gunning us down or a government telling us which candidates we can and can’t support. But look at Hong Kong. The residents of Hong Kong want to vote on a real slate of candidates and are protesting in the streets. There are people in many countries who fight for this basic right often against governments and militaries who try to stop them.

My middle son went to Iraq with the Marines in 2004. Do you remember the image of the woman with the purple ink stained finger? She held it up to prove she had voted….and that she was able to vote. My son and so many others were there to help secure the safety of that process.

The night before that election, I got a call from him. The Marines wanted these fighters to call home and talk to their families the night before that historic event. It was one of the most thrilling and frightening calls of my life. No one knew what would happen the next day. Chaos or order? Bloodshed or democracy?

People have died to vote in places very far away, and somehow we can’t be bothered over here. Got a TV show to watch? Too busy? Chance …

Say It Ain’t So!

October 16th, 2014

by Susan Combs

Elections seem to bring out both the best and the worst in people. The airwaves and radio stations are often full of bad things being said about people we didn’t know were really bad…until someone told us. And of course everything you read or hear is always true. Right?

Not really. I was first elected to public office in 1992, and without going into any gory details, I learned things about myself that I had never known. A friend of mine with a weird sense of humor sent me a newspaper clipping from Houston that he had doctored up. An individual with my last name was accused of drug dealing and was on the “Most Wanted” list. My buddy substituted my face and my name and faxed it to me.

I put the article on our breakfast room table and my oldest son (who was a teenager at the time) read it, looked up at me and said “Mom, is this true?” Uh, no. But it illustrates the problem for all of us. He believed what he read, which was of course not true. We are all guilty of not spending enough time thinking about the candidates running for office, and deciding if they share our views, hopes, and aspirations. So here are my suggestions for some questions to ask candidates running for office.

Will the person put Texas and its people first? Will this person work to keep the economy growing so that families can expect better things for their children? Will they take positive steps to educate your children and ensure tomorrow’s workforce is prepared for the jobs of tomorrow?

What are the issues they talk about most frequently, and are those the same issues you care about? Do they seem to be real people, and can you imagine having a cup of coffee with them? If you contact their office, do you get information, …

Texas Doesn’t Break Your Bank

October 9th, 2014

by Susan Combs

Growing up as the daughter of a very cost conscious father had the beneficial effect of making me cost conscious as well. When you never know if it is going to rain over the summer, or whether there will be enough wind to turn the windmill up the hill to make sure we had water down at the ranch house, you are very aware of things beyond your control.

So when you do have the chance to exert some control over your finances, it is a big relief. As a kid, I would do household jobs and occasionally I even got paid for them. Quite a treat. And I kept my money in a piggy bank. It wasn’t pink but it was shaped like a pig and had a slot running down the back to drop coins in. There was a little dial on the bottom, which you could turn to get your money out.

Today we use banks, and we do a lot of our banking online – although I miss that satisfying “kerchunk” of coins I used to hear when I shook my piggy bank. But whether online or a little ceramic piggy, the goal is the same – save your money. But what if someone could come up to you and physically take the money you had put aside?

Taxes have a way of doing that. You got paid to do a job, or you had accumulated some money, and then you have to take a portion of that and give it to government. It may be the federal government, which is taking an ever-increasing part of our money. It may be the city or county where you live – through property tax or some other form of taxation. Sometimes it doesn’t seem very visible. But if you absolutely knew a state was going to take a big slice of your piggy bank, you …

Led by oil and gas, Texas No. 1 in U.S. for exports

October 6th, 2014

by David Hendricks, San Antonio Express-News

Texas led the nation in exports last year, selling a record-breaking $279.5 billion worth of goods abroad, U.S. Trade Representative Michael Froman said Monday in San Antonio.

That marked a 183 percent increase over the Lone Star State’s export sales in 2003. It also beat Texas’ previous export record of $264.7 billion in 2012.

Last year, companies in the San Antonio-New Braunfels metropolitan area exported $19.3 billion in merchandise.

“More than 1 million Texas jobs are supported by trade,” Froman said. “Our job is to open more markets to exporters. Ninety-five percent of the world’s consumers live outside the United States.” Texas’ largest trade partner was Mexico. The state’s manufacturers posted $100.9 billion in merchandise sales in Mexico in 2013, representing 36.1 percent of the state’s total merchandise exports.

Mexico was followed by Canada at $26.1 billion, Brazil at $10.9 billion, China at $10.8 billion and the Netherlands at $9.5 billion.

The state’s largest manufacturing export category was petroleum and coal products, which accounted for $60.6 billion of Texas’ total goods exports in 2013. Oil refiners have been helped by cheaper crude oil flowing in from the Eagle Ford Shale and the Permian Basin.

If Congress lifts an export ban on crude oil — as producers are pushing for — Texas’ export sales probably would jump significantly because of booming drilling activity in its shale regions.

Other top manufacturing exports were electronic products at $48.2 billion, chemicals at $47.9 billion, machinery at $30 billion and transportation equipment at $24.4 billion.

Lone Star Success News