If you rent a U-Haul truck and move from Houston to Los Angeles, it will cost you $706 for the one-way trip. However, if you move from Los Angeles to Houston, the one-way U-Haul rental will total $2,051! Why does it cost three times as much to travel eastbound on Interstate 10?
The U-Haul cost disparity is a function of shifting demographics. The Claremont Institute’s William Voegeli explained that between 2000 and 2007, California experienced a net exodus of more than 1.1 million people. Over the same time period, Texas gained more than half a million new residents. A reasonable explanation for this migratory pattern is that people are leaving high-tax states such as California and relocating to low-tax states like Texas.
How disproportionate is government spending in California? In 2007, California’s state and local governments spent $10,712 per resident, which is 33 percent greater than the spending per capita in Texas. To fund its entitlement spending, California levies the sixth-highest state and local tax burdens in the United States.
It’s no better for California businesses. The state has the fourth-highest business tax rates in the country, which explains why business owners are leaving the state to open shop elsewhere. The Tax Foundation ranks California’s business climate forty-eighth in the nation. (Texas, if you are wondering, has the nation’s fifth-lowest business tax rate and ranks eleventh on the business climate survey.)
So what does this mean for jobs? As of December 2009, the unemployment rate in California was 12.4 percent. This is significantly higher than the 8.3 percent unemployed in Texas. In fact, Texas created 70 percent of all new jobs in the United States during 2008, while operating a budget surplus.
All of these facts serve to illustrate an important point. Arizona is not only geographically located between California and Texas, but also statistically in the middle of the two states. Arizona’s government spending, unemployment rates and business climate statistics are thankfully not as bad as California’s. But Arizona’s numbers are not as good as Texas’ either.
Arizona’s budget gap is 41 percent and the Pew Center ranks the state second most at-risk of financial collapse. (California ranked the highest, if you are still keeping score.) Lawmakers in Phoenix are considering different ways to address the state’s economic problems. But they would be wise to first look at the opposite policies adopted by Sacramento and Austin.
Arizonans want to restore the state’s status as a great place to work and live. Besides, it’s too expensive to rent a U-Haul truck and move to Texas.
Neil Rosekrans is a founder and partner of StateBrief.com. He has been a guest political commentator for the Arizona Law Channel, NBC's Sunday Square Off and The Terry Gilberg Show on KFYI. Neil earned his undergraduate degree from Cornell University and earned his MBA and Masters in Public Policy, with an emphasis in International Relations, from Pepperdine University.
Neil and his wife, Beth, live in Scottsdale, Arizona. 
Wow! I had no idea of the relative costs of Tx and Ca. Interesting and enlightening.
California had a jobs boom and great quality of life until anti-tax policies hit. Texas might sound like a great place to live, but its major cities combat pollution and high crime and booms and busts very much like Phoenix does. Having lived in all three places, I speak from experience, not just from doing research.
Pithy premise, but it doesn’t hold water.
@hope I don’t think that your claim “California had a jobs boom and great quality of life until anti-tax policies hit”
I can only assume that your referring to Prop 13 which limits property taxes. From when it was passed in the 1970′s to the early 1990′s California did have a economic boom. But education and transportation were exempt by the early 1990′s and the quality of life really went down since then. Your right property taxes were limited in California but ever single other tax has been raised since then. They are one of the highest taxed people in the nation.
But as a statistical fact California has lost population while Texas has gained population. That says a lot about California policies.
http://online.wsj.com/article/SB120277561232960623.html
http://online.wsj.com/article/SB119724619828518802.html
This reminds me of two op-ed pieces.
The Big-Spending, High-Taxing, Lousy-Services Paradigm
What might interest Tiebout is that while California and Texas are comparable in terms of sheer numbers, their demographic paths are diverging. Before 1990, both states grew much faster than the rest of the country. Since then, only Texas has continued to do so. While its share of the nation’s population has steadily increased, from 6.8 percent in 1990 to 7.9 percent in 2007, California’s has barely budged, from 12 percent to 12.1 percent.
Texas vs. Ohio.
http://online.wsj.com/public/article_print/SB120450306595906431.html
There’s no doubt times are tough in Ohio. The state has lost 200,000 manufacturing jobs since 2000, home foreclosures are soaring, and real family income is lower now than in 2000. Meanwhile, the Texas economy has boomed since 2004, with nearly twice the rate of new job creation as the rest of the nation. The nearby table compares the states over a decade or so.
Let’s start with the fact that Texas’s growth puts the lie to the myth that free trade costs American jobs. Anti-Nafta rhetoric doesn’t play well in El Paso, San Antonio and Houston, which have become gateway cities for commerce with Latin America and have flourished since the North American Free Trade Agreement passed Congress in 1993. Mr. Obama’s claim of one million lost jobs due to trade deals is laughable in Texas, the state most affected by Nafta. Texas has gained 36,000 manufacturing jobs since 2004 and has ranked as the nation’s top exporting state for six years in a row. Its $168 billion of exports in 2007 translate into tens of thousands of jobs.
Yeah, but who wants to live in TX? Ugh. There is nothing to do there and too many simple minded people.
Really?