It’s about free markets, not about Texas

As California’s budget battle continues, Republicans and Democrats have engaged in a rhetorical battle regarding the relative merits and demerits of our lovely state and one of the nation’s other growing mega-states, Texas. This debate started after a legislative delegation made up mostly of Republicans went eastward in April to meet with Lone Star officials to learn about job growth and has re-emerged as Texas Gov. Rick Perry is mentioned as a potential GOP presidential hopeful.

“From 2008 to 2010, Texas added more than 165,000 jobs,” said Assemblyman Dan Logue, the Marysville-area Republican who organized the fact-finding mission. “During that same time period, California lost 1.2 million jobs. In terms of creating jobs, Texas is clearly doing something right and California is doing something wrong.” I read that quotation on the website of Gov. Perry, who is known for his trips to California to encourage our state’s highly taxed and regulated businesses to move to his state, where they are welcomed rather than treated like pariahs. The city of Vernon in Los Angeles County, targeted for extinction in the wake of a corruption scandal, has even run ads blasting Texas for trying to steal its businesses.

We’re becoming a two-tier society and that old-fashioned California entrepreneurial spirit is dying, having the life sapped out of it by regulators and bureaucrats. In 2006, the Orange County Register reported on how Caltrans became the state’s biggest slumlord. The agency used eminent domain to acquire thousands of properties for roads it never built, then let the properties rot. As one Register reporter put it recently, this is “a story about how the nation’s largest freeway builder neglected its massive land holdings, creating blight and despair. It was about how Caltrans kept properties off the tax rolls, draining county coffers of tens of millions of dollars in lost revenues.”

The latest update, courtesy of the Los Angeles Times, is that Caltrans has been spending absurd sums of money putting new roofs on these old properties, spending many times more than what such a roof would cost on the open market. In one case, the agency spent more than $171,000 for a roof on a decrepit, vacant house. This is how government operates. It is inefficient, immune to market pressures, driven by bureaucratic decisions and prone to abuse its power. Anyone who has dealt with a government agency will tell stories of how irrational its decision-making and spending decisions can be. Had private owners been in charge of the properties, they would mostly be well kept and no one would pay 170 grand for a new roof.

California officials cannot figure out their budget problems. They cannot figure out how to build infrastructure that keeps up with a growing population. They cannot figure out how to lure good-paying jobs or to stem the drop in home prices. Meanwhile, they continually look toward tax increases, which is nothing more than a transfer of wealth from those who create it to those who squander it.

The answer to all these questions is simple: Do less. Govern less. Spend less. Let the market work. Then the jobs will flow and the public coffers will be filled again. This isn’t about Texas, but about enterprise and freedom. Until California voters understand that, it’s going to be a long time before we are prosperous again.

Steven Greenhut is editor of; write to him at

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