Numbers can tell a story, and they can tell the story behind the story.
Texas now ranks second in the country for attracting rich young people. The state has recently had a net gain of 1,660 young and rich households, based on a study by SmartAsset using 2021 and 2022 data from the IRS.
Here’s another number that tells a story: Dallas is the 22nd wealthiest city in the world and sixth in the U.S., based on the number of millionaire residents, according to a report from London-based Henley & Partners.
These are some of the fruits of economic success that have made Texas one of the great economies in the world and Dallas a powerful, yet underrated financial services hub. Success emanates from a commitment to entrepreneurship and business opportunities that don’t exist in states that embrace excessive regulation, taxation and higher costs.
However, we must acknowledge the story behind the story — rising market values, accompanying property tax bills and decreased affordability for the middle- and lower-income residents.
That was the impetus for a state law capping property tax revenue that Gov. Greg Abbott signed in 2019. The bill helped curb the rapid growth of property tax bills through a 3.5% cap, absent voter approval.
That’s a start, but it’s far from clear that a simple tax cap can address the broader affordability challenge too many Texans are now facing.
It is well known that the two coasts lost residents and corporations to Texas, not to mention other states, with lower taxes, warmer weather, less onerous regulation and more affordable housing.
We’ve been quick to crow about that here and to sneer at the growth-killing policies of the coastal states. But our time of enjoying both a low cost of living and enormous growth seems to be coming to a close. It is increasingly unaffordable to live in Texas’ biggest cities.
And that’s the story behind the story. So what do we do now? That is the question that needs to focus lawmakers’ minds in the coming legislative session, as well as in city halls across the state.
We firmly believe that a big part of the answer rests in controlling the cost of government and in doing everything possible to free up labor and materials markets while keeping regulatory barriers low.
In cities especially, we are seeing an increase in costs, including growing fees that take the place of taxes, or and in lost taxes paid out as “economic development” incentives that often rob Peter to pay Paul. State and local policymakers need to work together to ensure that Texas is an easy place to build with a robust labor and materials market at the ready.
The “Texas miracle” came about through a commitment to letting business bloom in every sector of the economy. Fast growth, a tight labor market, high interest rates and higher taxes are lately making our miracle seem more like lucky timing.
Getting back to affordability has to be job one.
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