The Texas Omen - Paul Krugman/NYT

[WillyT]

The Texas Omen
By PAUL KRUGMAN
Published: January 6, 2011

<snip>

These are tough times for state governments. Huge deficits loom almost everywhere, from California to New York, from New Jersey to Texas.

Wait — Texas? Wasn’t Texas supposed to be thriving even as the rest of America suffered? Didn’t its governor declare, during his re-election campaign, that “we have billions in surplus”? Yes, it was, and yes, he did. But reality has now intruded, in the form of a deficit expected to run as high as $25 billion over the next two years.

And that reality has implications for the nation as a whole. For Texas is where the modern conservative theory of budgeting — the belief that you should never raise taxes under any circumstances, that you can always balance the budget by cutting wasteful spending — has been implemented most completely. If the theory can’t make it there, it can’t make it anywhere.

How bad is the Texas deficit? Comparing budget crises among states is tricky, for technical reasons. Still, data from the Center on Budget and Policy Priorities suggest that the Texas budget gap is worse than New York’s, about as bad as California’s, but not quite up to New Jersey levels.

The point, however, is that just the other day Texas was being touted as a role model (and still is by commentators who haven’t been keeping up with the news). It was the state the recession supposedly passed by, thanks to its low taxes and business-friendly policies. Its governor boasted that its budget was in good shape thanks to his “tough conservative decisions.”

Oh, and at a time when there’s a full-court press on to demonize public-sector unions as the source of all our woes, Texas is nearly demon-free: less than 20 percent of public-sector workers there are covered by union contracts, compared with almost 75 percent in New York.

So what happened to the “Texas miracle” many people were talking about even a few months ago?

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More: http://www.nytimes.com/2011/01/07/opinion/07krugman.html?_r=1

:kick:

[w8liftinglady]

1. Yeah ... and Texas leads the US in uninsured.. I am so proud.

sigh

[Greybnk48]

2. The repukes are going to be forced to raise taxes on

their watch in Texas and elsewhere...or let their states go under. The stupidity is mind-boggling.

[yella_dawg]

4. They have been raising taxes regularly since Bush.

They just shift it to the local levels. Property taxes in some area have you buying your home back every twenty years, and even less in a few areas. In my municipality, the miscellaneous "fees" on the monthly bill exceed the cost of water, sewer, garbage. The Texas republicans raise taxes plenty, they just hide it.

Bush did the same thing at the federal level, after perfecting the technique in Texas, which is why the states are crumbling now. "Unfunded mandates" have come home to roost.

[northoftheborder]

3. Thanks, Paul Krugman, for shining a light on this Republican pit of third world status.

This is NOT sarcasm - I mean it. Texas has for too long shoved under the rug it's deficits, bragging about it's best, biggest, most successful etc...... to nauseum.

[Ezlivin]

5. The Barnett Shale will save us all

If you've not been in Texas, you would find it hard to believe how crazy it's become with the gas drillers. They are putting rigs everywhere. If one person in a neighborhood signs a lease, then all of the other neighbors have to sign or the gas company will simply drill under their property and take the gas anyway, paying them nothing.

Everyone wants the "free" money, so it's a free-for-all here, with neighbor pitted against neighbor. The drilling rigs are noisy, consume vast amounts of fresh water and are implicated in the poisoning of fresh water supplies. Yet greed drives it on.