Thursday, June 9, 2011

Where are the new jobs?


Patrick_L said...

this article actually has some pluses if you scratch the surface, probably because even though the WSJ board did their usual best to mischaracterize the evidence, there was only so much twisting they could do the economic reason and sanity provided by Richard Fisher and Fed research.

Once again, I'll repeat that taxes, government policy, and unions do not significantly effect growth or explain state-by-state varation in economic success. This is borne out by numerous economic studies.

Much more important for Texas is a variety of non-governmental factors such as geographic features and conditions (like temperature and access to major trade connections), or major industries present in the state (such as a recession and globalization-resistent industries like health care or energy extraction).

The WSJ also once again is weak on its statistical presentation because it insufficiently presents data to control for the fact that Texas is huge. It knows it has to head off that discussion so it throws up a smokescreen by comparing to NY or California, but their data presentation still insufficiently controls for population size (and numerous other factors like demographics). I know it's outside their field of expertise, but I encourage the Tax Foundation to once again point out how the WSJ is a master of lying with statistics.

The WSJ also gets it wrong that Texas is fiscally responsible, considering its projected deficit shortfalls (in percentage terms so standardized for state size) for FY2012 and 2013 are only behind New Jersey's and Nevada's in size.

In addition, the WSJ actually provides good evidence that government intervention has been helpful for Texas. First, the reform of the overall tort system. Second, (and likely more importantly considering the characteristics of the current economic decline), Texas apparantly has a better state regulation system over the "private," "free" housing market.

Good for them.

TJE said...