This commentary originally appeared in the San Antonio Express-News on June 30, 2015.
America will likely become “majority-minority” in 30 years — that point where the white, non-Hispanic population slips to below 50 percent. But Texas and three other states, California, Hawaii and New Mexico, are already there.
These states have vastly different public policies. California has the nation’s fourth highest state and local taxes, according to the Tax Foundation, with Texas 47th. The regulatory burden falls far below the national average in New Mexico and Texas, according to the Fraser Institute, but red tape is far more plentiful in California and Hawaii.
Texas’ enviable jobs record has likely gotten a boost from its tax and regulatory environment, but what about poverty? Detractors claim many of the jobs created in Texas offer low pay.
The U.S. Census Bureau has two poverty measures.
The official one is more than 50 years old and doesn’t account for cost-of-living differences from state to state, nor does it consider the value of food stamps and housing vouchers, taxes or work expenses. Under this measure, 21.5 percent of New Mexicans fell below the poverty line in 2011 to 2013 vs. 17 percent in Texas, 16 percent in California and 12.4 percent in Hawaii.
But the average rent in San Francisco is $3,803 compared to $1,018 in San Antonio. What if this were taken into account?
Census addresses the official poverty measure’s shortcomings with its new Supplemental Poverty Measure. Under this more comprehensive measure of poverty, California had the nation’s highest poverty rate from 2011 to 2013, 23.4 percent, 47 percent more per capita than Texas’ rate of 15.9 percent, a rate matching the national average.
How do America’s four largest racial and ethnic groups do in these four majority-minority states? Texas is the only state where white, non-Hispanics; Hispanics; black, non-Hispanics; and Asians all have supplemental poverty rates below the national average. New Mexico’s residents also do well. In California, on the other hand, all four groups suffer a poverty rate above their group’s national average.
Since people are doing better in Texas, the policy question is, why? Jobs are one part of the equation. Regulation is a second large component. Somewhere in excess of 30 percent of California’s high housing costs are due to excessive environmental regulations, including greenhouse gas emission rules.
High-cost housing hurts the working poor far more than it does the elite. Regulations also discourage small business and entrepreneurship.
As the campaign for president heats up, there will likely be increasing scrutiny on Texas and its style of governance. Lone Star State skeptics should keep one thing in mind: In three short decades, America will look like today’s Texas or California, and, as far as poverty, jobs, taxes, regulation and welfare, the Texas model works.
Chuck DeVore is vice president of policy at the Texas Public Policy Foundation and served in the California Legislature from 2004 to 2010.