What Happened To The Texas Miracle? Did It Ever Really Exist?

Journalist Richard Parker argues that a combination of government leadership that isn’t focused on economic issues, and the aftermath of Hurricane Harvey will do much to keep Texas economy in the doldrums.

By Alexandra HartSeptember 26, 2017 2:57 pm| ,

The idea of the Texas Miracle is firmly entrenched as a part of the state’s identity. Regardless of what is going on with the nation’s economy as a whole, the theory goes that Texas will not only weather the storm, but thrive.

But for some, the Texas Miracle isn’t feeling so miraculous anymore. That’s the case made by journalist Richard Parker, who wrote the best-selling book, “Lone Star Nation: How Texas Will Transform America,” a couple of years ago. His recent op-ed for the New York Times takes on Texas’ reputation from a different angle. He says that not only is the miracle over, but that it was a ‘tall tale’ that never was true to begin with.

Parker believes three factors explain why the Texas economy is suffering. Firstly, economic growth has been flat for more than two years, Parker says we’re likely to experience continued sluggishness this year, in light of Hurricane Harvey. Second, there is continued unemployment in the oil sector, though this situation may not be as obvious to those who live in cities and suburbs. Finally, Parker says, the current Republican leadership in government has not focused enough on the economics, meaning that politicians have argued over social issues, like the so-called “bathroom bill,” creating uncertainty for companies.

Parker says Gov. Greg Abbott has “abandoned what was the de facto industrial policy of Rick Perry to attract business to the state.”  

He says the number of incentives offered to businesses via the Texas Enterprise Fund is far lower under Abbott than was true when Perry was governor.

“When you look at the corporate values that are stowed today about diversity and acceptance, which is important to customers and employers and shareholders alike,” Parker says. “I think that’s going to be a real tough putt for any city in Texas.”

Parker says that because Houston is the economic driver of Texas, and is also one of the most important engines of the American economy, the disaster of Hurricane Harvey has the ability to alter Texas politics.

“We do need some government solutions, whether it’s to drain Harris County better or put teeth into laws that provide for conservation,” he says.

Some local governments and state politicians want to invest whatever it takes to bring Houston back. Parker says this money will not come from the private sector, but rather from the state and, more importantly, from the federal government. If the federal government isn’t pumping approximately $2 billion a year into Houston, someone will be responsible and have to take the fall, Parker says. The worst is yet to come.  

 

Written by Dani Matias.