What California Can Teach Us About Texas
In recent years, Rick Perry and assorted state lawmakers have led delegations to California as if they were Cold Warriors conducting missions to Moscow. “Don’t California our Texas” became the syntactically challenging rally cry against the left-coast bogeyman. Now, Greg Abbott has warned that Texas is being “California-ized.”
But behind the sloganeering and general contempt for California is the idea that Texas is booming because of our low-tax, low-service model, and that any attempt to raise revenue or improve services will lead to disaster, as it has in California. California boomed and boomed, and for decades Americans flocked there to take advantage of gleaming infrastructure and top-notch schools. Now, the feeling goes, the boom is over because of the libs and their policies.
The full picture is messier. For one thing, most lower- and middle-class Texans pay more taxes than their counterparts in California. But for Texas officials, reality is irrelevant. What they mean, really, is that they don’t want the “Texas Miracle” to end. And some of them sincerely believe it never will, so long as the right policies remain in place. That saves lawmakers from having to acknowledge that someday Texas’ economic engine will slow, as all boom economies do, and they or their successors will face not a developing state but a mature one. The failure to plan for this inevitability has vast and pernicious public policy consequences.
Which brings us to Proposition 1, the statewide constitutional amendment passed in November, which will increase the homestead exemption on property taxes that go toward schools. Though it was one of the most controversial measures last legislative session, Prop 1 attracted little fanfare or attention in the run-up to the vote. It coasted to victory with 87 percent approval, while the ballot initiative’s champion, Lieutenant Governor Dan Patrick, was off crusading against the Houston Equal Rights Ordinance.
Perhaps Patrick and others spent so little time promoting Prop 1 because it means so little in savings — $100 to $150 a year for most homeowners, which they may or may not notice as their tax bills rise because of appreciating home values. But of all of the items on the ballot this November, Prop 1 was arguably the most important. The measure will shear some $1.3 billion each biennium from the state’s already razor-thin budget to reimburse school districts, when billions more are needed in nearly every major area of spending.
Ominous, too, was Patrick’s statement after Prop 1 passed. He declared it the “first step in providing property owners real tax relief.” Prop 1’s lopsided victory, he said, would give the Legislature “the clout to do more property tax relief next session,” and silence the naysayers who opposed Patrick earlier this year. Even as oil prices stay depressed and the comptroller signals caution that the state’s finances don’t look as rosy now as they did last year, forcing local taxes lower will likely remain a top priority.That brings us back to the yarn Texans have spun about California: The Golden State, they say, ran into problems because of overspending — too many freebies for its complacent population — and bloated itself into economic oblivion. Texas must stay stingy to prevent that from happening here.
It’s a neat tale, but there’s another one to tell. Since the mid-1970s, California voters have systematically made it more difficult to raise taxes. The result: Cities have less money to spend on local services, and are dependent on a gridlocked legislature for funding. Everyone has to make do with less.
In the 1960s, California’s school and transportation systems were among the best in the world. Now the schools are among the country’s worst, and the state’s physical infrastructure has mounting problems. The California Department of Transportation estimates it needs $59 billion more just to fix roads.
The Texas Department of Transportation, meanwhile, says it needs $10 billion more a year to keep up with growth, and lawmakers aren’t doing much to plug the gap. Texas badly underinvests in health care, education and infrastructure at a time of extreme growth. It seems that, like California, we’ll further restrict our ability to provide services at precisely the time we most need them, and we won’t realize for years how much damage we’re doing.