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Crashing Oil Prices Can’t Keep Texas Down

Despite the threat that the collapse in the global price of oil poses to one of Texas’s most important industries, people are still flocking to the Lone Star State. Bloomberg reports:

Eight of the top 20 counties that gained the most population last year were in Texas. Four Lone Star metros—Dallas, Houston (Harris County, in the chart below), San Antonio (Bexar County), and Austin (Travis County)—collectively added more than 412,000 people from July 2014 to July 2015, according to Census data published Thursday. Of those new residents, 63 percent had migrated from either elsewhere in the U.S. or from other countries. […]

Cheap housing and the absence of a state income tax make the state popular with workers, while low corporate taxes and a reputation as a probusiness regulatory environment have persuaded large employers to relocate, said Jim Gaines, chief economist at the Texas A&M University Real Estate Center. In Dallas, an ongoing boom in office construction is being led by companies—JPMorgan Chase, Liberty Mutual Insurance, and Toyota Motor Co.—whose fortunes are more closely linked to the national economy than to the energy sector. Austin, meanwhile, is a popular location for such tech companies as Dell, IBM, and chipmaker Advanced Micro Devices. “So far, those cities aren’t showing those ill effects of the energy bust,” Gaines said.

You can be sure that many blue state defenders have been closely watching Texas over the past year, waiting to see if its remarkable growth might reverse course as bargain crude prices pushed fracking firms out of business. That doesn’t seem to be happening, however, in part because the shale industry has proved remarkably resilient to the effects of shrinking profit margins (never bet against American innovation!), but also because the state is finding ways to attract companies and people not involved with the energy industry.

The fifty states are one of America’s great strengths—they are our fifty laboratories of democracy, and they allow us to observe which policy experiments work well, and which are busts. Clearly Texas is onto something, and as it continues to attract new people even as cheap prices squeeze the oil industry, the state’s cynics are losing one of their favorite critiques.

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