Welcome Texans!

Joseph Vranich
Principal of Spectrum Location Solutions helps companies plan and select ideal sites for new facilities across the U.S. and internationally.

This is an open letter to Texas Gov. Rick Perry and his Economic Development team visiting California this week. Their goal is to interest businesses in relocating to their state or at least selecting Texas as the place in which to expand.

Dear Governor Perry and Delegates:

As you’re fix’in to come out here, I’m going to be presumptuous and give you some advice.

First, we all know that “jingoism” is a term used for people who fervently believe their nation is superior to others, people who will demean other countries.

California’s jingoists believe the state is superior to Texas – so much so they get hotter than a jalapeño and look for ways to insult you and all states they consider “secondary.”

For example, when Iowa Gov. Terry Branstad visited California on a recruiting trip, Gov. Jerry Brown’s office ridiculed the idea that businesses would flee the state “for the cold, empty and desolate hinterlands.”

Considering current thinking in Sacramento, Gov. Brown’s office seems to be expert on “empty and desolate.” And, by the way, I’ve had great times in Dubuque.

I remember when Gov. Brown had a conniption over your radio advertising about the favorable business environment in Texas, saying that your ad campaign was “barely a fart.”

His focus on smells was understandable considering the odoriferous winds surrounding the bureaucracies and a majority of the legislature. A better reaction would have been to ask the Texas delegation for lessons in how the Lone Star state managed to add jobs throughout the recession while California lost jobs.

Florida Gov. Rick Scott, a former CEO, is considering posting billboards in California to lure businesses. Maybe Gov. Brown will switch from the sense of smell to sight and claim the billboards don’t exist, calling them “optical illusions.”

I had an optical illusion in Florida when I saw a car with a sign saying “We’re moving to California!” On closer inspection, it said, “We’re moving to Baja California!” (For geographically-challenged Californians – that’s in Mexico.)

I don’t know how Sacramento reacted to whirlwind tours by other Governors –Pennsylvania’s Tom Corbett, South Dakota’s Dennis Daugaard and New Jersey’s Chris Christie. In an unusual move, Utah’s Gary Herbert and Virginia’s Bob McDonnell visited California together to pitch their home states.

I think those visits caused a hissy fit in Gov. Brown’s office. By the way – back to Texas – the snacks at your reception were delicious!

Anyway, where was I? Oh – I could be wrong but I think California’s acerbic, big-spending, tax-loving politicos will direct insults toward you Texans again. Your reaction? All you need do is provide facts.

(To California politicians – “facts” are things that are indisputable, something that is actually the case – like the sun rises in the east every morning. That’s different from imaginary and exaggerated assertions that you yourselves often say!).

Here are the abominable ways California treats business:

Fact – California Is the Worst: For nine years in a row surveys by Chief Executive Magazine found California to be the worst state for business. CEO’s say things like “California treats business owners like criminals,” and in the past editors called the state the “Venezuela of North America.”

Texas ranked number 1 in that survey. Good job! I can imagine Sacramento politicians declaring, “By gosh, we’re gonna move from number 50 to number 49!” That isn’t going to stop a company from moving to Houston.

Fact – California’s taxes are obscene: The Tax Foundation’s 2013 State Business Tax Climate Index lists California at No. 48 while CFO Magazine a year earlier ranked it the worst state for tax treatment. Also, taxes hit the little guy. Californians who earn more than $48,000 pay a top rate of 9.3%, which is higher than what millionaires pay in 47 states.

You Texans have a reasonable business franchise tax and no personal income tax. Hooray for you! Or in Texas-speak is that hurrah? Please advise.

Fact – California Can’t Stop Throwing Away Cash: Taxpayers’ dollars are being gobbled up by voracious public-sector appetites. Even now they’re spending more than they’re taking in. Some of the biggest abuses can be found in education, salaries and pensions, and in the high-speed rail program that the state auditor says could cost $105.1 billion – a project shockingly out of compliance with the statute that funded it.

Texas voters are smarter because they elect more business people to the legislature. Chuck DeVore, a former California legislator now with the Texas Public Policy Foundation, reports that gobs of California legislators have worked for government or, even worse, were attorneys. Texas Democrats are more than twice as likely to claim private-sector experience outside the field of law while 75 percent of Texas Republicans earn a living in business, farming or medicine. Aha! Part of the Texas secret is having fewer lawyers while California went the other way when UC Irvine in recent years created a law school! Shakespeare would ask, “Why doth such a thing? Hath thee no common sense?”

Fact – California’s Program to Stop Global Warming Is a Costly Fraud: California issues only 1% of the world’s greenhouse gases, yet it’s fighting global warming with a strange and illogical cap-and-trade program. Investor’s Business Daily called it “economic suicide” in pointing out that businesses must now deal with 262 pages of new regulations and must pay billions of dollars annually in “fees” to purchase carbon credits. I ask Sacramento: “If you’re truly worried about global warming, why aren’t you denouncing China and India for building numerous carbon-emitting, coal-fired power plants instead of picking on your own small-carbon-footprint people?”

Is it my imagination or is it getting hotter in here? Well, anyway, you Texans have refrained from creating meaningless bureaucracies whose fees will rob companies of needed capital. I’ll echo others who say California is running some kind of a racket just to make money.

Fact – California Is ‘Lawsuit Heaven’: The American Tort Reform Association labels the state as the nation’s worst “Judicial Hellhole” because of its business-hostile laws.

Let’s applaud you Texans for curtailing lawsuit abuse through tort reform so that innocent employers could put money into job growth. That’s better than paying million-dollar damage awards to grocery clerks who suffer “mental anguish” when customers use plastic bags

Fact – California Spreads the Pain: I could go on about California’s high energy costs, expensive workers’ compensation system and more. Let’s just say that the woes affecting large corporations hit small businesses ever harder. The Kauffman Foundation gives California an “F” grade from small companies for business, employment and environmental regulations, and for the tax code.

Texas earned the grades “A” and “A+” in all categories. If I could, I’d punish California’s “students” by making them memorize the state’s income tax code and requiring they quit their part-time jobs at the marijuana collective.

Fact – Californians Are Leaving: Along with companies interested in heading east are residents. Joel Kotkin, editor of NewGeography.com, said, “Nearly four million more people have left the Golden State in the last two decades than have come from other states. This is a sharp reversal from the 1980s, when 100,000 more Americans were settling in California each year than were leaving.” The Tax Foundation reports that in the last decade more people moved from California to Texas than vice versa.

If we had a Super Bowl to determine the most effective state government, the Lone Star state would crush the so-called Golden State. Coach Rick Perry would accept the Lombardi Trophy while players splashed Shiner Bock beer all over him. Coach Jerry Brown would say, “Well, we really won, but that scoreboard, run by declinists, is wrong.”

So, dear visitors from Texas, should California’s jingoists disparage you again, just ignore the cheap shots. After all, the facts are so very much on your side.

Disclaimer: In my role as a site selection consultant, it’s rare for me to promote one state or location over another. However, I’m offended that California’s elites belittle Texas when California is the poster child for a dysfunctional government, contempt for the constraints of law and common sense, and a foul business environment.

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