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Texas creates more jobs than Cali, because this state is clearly more interesting for them.
At the moment, but not in general. Both Texas and California have been growing in population at about the same rate for the last 30~40 years. I would imagine going forward Texas would grow faster in population as many areas of California are now built out.
Venture Capital gives you a good idea about high-value start-up activity, the claim that "investors are clear about it" is just wrong. Investors are acting very differently than what these rankings suggest. But Investors are a much different interest group than CEOs, I take the views of CEOs with the same grains of salt I take the views of politicians. Both are likely biased.
No, I mean false as in you continually deny the fact that whether you are comparing Texas, or Austin alone, they are doing A LOT better than the rest of the US. It's silly to argue otherwise. As for evidence, well how about the list at the top of the thread? Or the one from my previous reply? It's much more recent than yours: Austin, Texas – Venture Capital’s Top 10 Lone Star » CB Insights – Blog
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Yes that is a recipe for economic disaster, but I guess you don't that it is Texas that it is the worst in this regard:
"AUSTIN - No state in the nation has a wider gap between its richest and middle-income families than Texas, according to a national study released Thursday"
Maybe in 2006, when CA unemployment was low and people were flush with housing boom money. But I'll bet it's not true today, when CA is the biggest welfare state in the country:
You did not establish this and if you look at the actual numbers you'll find that on a per-capita basis Texas is very average in terms of VC. Not as bad as a state like OH, but no where near a states like CA, MA, etc.
Texas is in the top 5 of VC getting states. This has been unquestionably established. The fact you continue to deny it simply causes everyone to question your credibility, myself included. No one has argued that CA and maybe 1-2 states get more VC $. If you don't believe my previous link, here's another:
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Rounding out the top five most funded states were Massachusetts, Texas, New York, and Georgia.
On Taxes: The aggregate taxes in Texas are lower than say MA or CA, but that does not mean they are lower for every company. If I moved to Texas today I'd pay more taxes, though in a few years from now I'd likely pay less in Texas. At the individual level, generally speaking a lower/mid level income folk is going to pay more in taxes in Texas and a higher income person is going to pay more in California.
Where on earth would you get the idea ANYONE would pay more taxes in Texas than CA? Even if you take into account the property tax rate in Texas, it's still a low-burden state (especially for the lower/mid level income folk, whose home price would be far below their CA counterparts). See:
Moderator cut: link removed, linking to competitor sites is not allowed (California #9th highest, Texas #50) Local and State Tax Burden Maps | Newgeography.com
And as far as corporate rates, CA's rate has always been really high. That's a fact that any California business person would readily admit to. Why can't you?
Top CA state/provincial tax rate: 8.84%
Top TX state/provincial tax rate: 1%
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On regulation: Government regulations don't effect businesses equally as well.
Agreed. However, AGAIN this thread is "best state for business". Not "best state for certain businesses", and overall the business regulations are far more business friendly. If you wanted to run a marijuana clinic, porn studio, or casino -- clearly CA would be the better choice. In those cases, it is true that Texas' business regulations are harsher.
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Fiscal: This is not really related to business environment, a state can be both in bad fiscal shape and provide a good business environment.
I disagree. State governments that are bankrupt can't provide businesses with a low tax burden or tax incentives, can't provide infrastructure, police, etc. They will have to charge more in taxes, charge more for water, charge more for unemployment benefits/workers comp, etc.
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Anyhow, the realities simply don't match these rankings, which for someone not clouded with dogma, would be a red-flag.
Are you referring to yourself? Cause you sure seem to agree with the rankings when they support your view, and your anti-Texas bias is about as blatant as it could be.
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My point here is not that California, New York, etc are better than Texas rather that a ranking that puts Texas on top and California at the bottom is very obviously motivated by politics and not reality.
Again, are you referring to yourself here? Trying to make excuses like politics or bias is, quite frankly, pretty weak. No one here other than you argues that Texas:
* Has a lower tax burden than CA
* Has created 70% of the jobs in the US since 2008
* Gets among the top VC $$ in the nation
* Has more business friendly regulations
* Has a cheaper educated workforce
It's clear why the CEOs would pick Texas as the top state for business repeatedly. All you've done is parrot the fact that CA gets a lot more venture capital, which we know is a component of a successful economy. But it's not the end-all-be-all, and when determining the best state for business overall -- it's just one of many factors.
Venture Capital gives you a good idea about high-value start-up activity, the claim that "investors are clear about it" is just wrong. Investors are acting very differently than what these rankings suggest. But Investors are a much different interest group than CEOs, I take the views of CEOs with the same grains of salt I take the views of politicians. Both are likely biased.
The reason the CEOs rank Texas tops is because they actually paid attention to the question. The question wasn't "which state was the best for VC" or "what state is most attractive to investors?" If that were the case, then maybe it would be CA #1.
Simply looking at one aspect (like VC) and ignoring all the other factors which affect business is short-sighted; that's why the CEOs polled the way they did. There is no reason to blame politics or bias just because the results didn't end up your way.
No, I mean false as in you continually deny the fact that whether you are comparing Texas, or Austin alone, they are doing A LOT better than the rest of the US. It's silly to argue otherwise.
Yes I deny it because its not true. Texas does not do "A lot better" than the rest of the US. Its level of VC is about average, it does better than say the rust-belt but does worse than much of the west and New England.
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Originally Posted by atxcio
But I'll bet it's not true today, when CA is the biggest welfare state in the country.
You'll bet that because you think welfare = declining middle-class. But that just begs the question and Texas provides a counterexample to this very idea.
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Originally Posted by atxcio
Texas is in the top 5 of VC getting states. This has been unquestionably established. The fact you continue to deny it simply causes everyone to question your credibility, myself included.
That fact that you ignored what I stated causes me to question your reading comprehension abilities. Texas is the 2nd largest state so largely its going to beat many smaller states in terms of the number of $$ invested, you need to look at the number of dollars compared to the size of population.
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Originally Posted by atxcio
Where on earth would you get the idea ANYONE would pay more taxes in Texas than CA?
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Originally Posted by atxcio
And as far as corporate rates, CA's rate has always been really high. That's a fact that any California business person would readily admit to.
California's corporate tax rate in itself is high, but there are numerous deductions that lower the effective rate. You can't just look at raw tax rates, they say little.
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Originally Posted by atxcio
Top CA state/provincial tax rate: 8.84%
Top TX state/provincial tax rate: 1%
Dude....Its obvious you don't know about taxes or business, but you really should dig a little dipper if you are going to cite things like this. California has a corporate tax on profit (revenue - all costs/deductions) where as Texas has a tax on gross-profit (revenue - cost of goods sold). The two are rather different, a company is going to have much greater gross-profit than profit. Whether or not a business pays more in California or Texas depends on the details. For example a manufacture is likely to pay less in Texas where as an internet company is likely to pay more in Texas.
Also, just to note the rate is .5~1% in Texas depending on your industry and LLCs and LLPs will also pay it.
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Originally Posted by atxcio
Not "best state for certain businesses", and overall the business regulations are far more business friendly.
Yep, hence why the rankings are so stupid. Businesses are always in particular industries, though California may have more regulations in general that says little about its business environment for the types of businesses that tend to be created in California.
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Originally Posted by atxcio
I disagree. State governments that are bankrupt can't provide businesses with a low tax burden, can't provide infrastructure, police, etc.
State governments can't go bankrupt and the federal government would borrow to California before it ever defaulted. This is a non-issue. The idea that businesses just care about a "low tax burden" is a fantasy.
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Originally Posted by atxcio
Cause you sure seem to agree with the rankings when they support your view.
Really? Can you give me an example of where I use business rankings to support my view? I've only cited data.
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Originally Posted by atxcio
Again, are you referring to yourself here? No one here other than you argues that Texas:
Are you having a conservation with someone else? Because, I have not disagreed with any of these. Rather in the case of three of them (2 of them I have no even discussed) I've argued that the situation is far more nuanced than how people usually think of it. That is:
* Has a lower tax burden than CA: In the aggregate its true, but there are no generic businesses so this is useless information. Individual businesses will have to run numbers based on their particular businesses to find out which state is cheaper. Contrary to the partisan rhetoric on this thread, its not always cheaper to operate in Texas.
* Gets among the top VC $$ in the nation: You have to compare $$ to population, if you do this Texas is average
* Has more business friendly regulations: Again no generic businesses, in some cases (e.g., polluting industry) Texas is more friendly for others its no different or worse than Texas.
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Originally Posted by atxcio
It's clear why the CEOs would pick Texas as the top state for business repeatedly.
It is clear, its called corporate welfare. Its funny that Texans think its a good thing that businesses can more freely pollute their state when in fact that is just corporate welfare.
T
Simply looking at one aspect (like VC) and ignoring all the other factors which affect business is short-sighted; that's why the CEOs polled the way they did. There is no reason to blame politics or bias just because the results didn't end up your way.
Of course there is, CEOs of established firms have very particular interests. In particular they want 1.) low taxes, 2.) they want to push business costs to the government/people, 3.) block new businesses from entering the market, 4.) lowest cost labor as possible, etc.
The last line is rather ironic, because I think the rankings are dubious I'm upset because its not "my way". Hogwash, "my way" is the way that is supported by reasoned analysis. I have no political axe to grind and you can find numerous posts here of me defending Texas from the opposite partisan elements in California.
It will be dramatically different, Harvard has some of the brightest minds in business where as Fresno state does not. Just because a Ford Fiesta and a Mercedes provide similar functions does not mean they are equivalent in quality.
Anyhow you want to equate rankings of educational quality with "brand names", this makes no sense the brands are built on their quality. Harvard is not just Fresno state with a better brand, the professors at Harvard are all going to be dramatically more accomplished than those at Fresno state.
It is not that Texas does not have any good public universities, it does, rather that it does not have enough of them to serve its residents. There are only 2 tier-1 public universities in Texas and its community college is not good.
I guess we'll have to disagree on the idea what a good education is and what the biggest advantages you get out of a "top" school vs. a regular one.
It is clear, its called corporate welfare. Its funny that Texans think its a good thing that businesses can more freely pollute their state when in fact that is just corporate welfare.
Corporate welfare exists in all states. It also is used to keep existing businesses from leaving. It's just part of the game that all levels of government play these days. I wish they'll just end those and just reduce the taxes for everyone.
Texas does not do "A lot better" than the rest of the US. Its level of VC is about average, it does better than say the rust-belt but does worse than much of the west and New England.
The fact that you cannot even accept what is universally a known fact -- that Texas DOES do better business-wise than most of the US, and that includes total $$ in VC -- really makes this a pointless discussion, right? You do understand you are the only one that is saying that. Why do you think no one else agrees?
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California's corporate tax rate in itself is high, but there are numerous deductions that lower the effective rate. You can't just look at raw tax rates, they say little.
So you are saying businesses in CA are paying LESS taxes than those in Texas because of deductions?
Prove it. Provide a source that shows the effective tax rate on business is less than the effective tax rate in Texas.
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Dude....Its obvious you don't know about taxes or business, but you really should dig a little dipper if you are going to cite things like this.
Dude, I'll try to be a bit "dipper" for you next time. Meanwhile, if you indeed do know something about business, you really shouldn't expect to be able to peddle the BS you are trying to do here. It is really not that complex -- loopholes and all, CA's tax burden is higher. And don't kid yourself, that rate is only going up; the government there has ensured that.
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California has a corporate tax on profit (revenue - all costs/deductions) where as Texas has a tax on gross-profit (revenue - cost of goods sold). The two are rather different, a company is going to have much greater gross-profit than profit. Whether or not a business pays more in California or Texas depends on the details. For example a manufacture is likely to pay less in Texas where as an internet company is likely to pay more in Texas. Also, just to note the rate is .5~1% in Texas depending on your industry and LLCs and LLPs will also pay it.
While I don't disagree that tax situations vary depending on the type of business, Texas will practically always come out ahead. The difference between a 1% tax on gross profits vs. 8.84% on net profits would mean that only a HUGE difference in gross v net profits would even begin to make things close. In fact, if you had actually read the link I sent before: The Tax Foundation - U.S. States Lead the World in High Corporate Taxes
You'll see that for Texas (and other states that tax gross profit) they used a methodology of taking the typical gross to net profits ratio, and adjusting the rate upwards. For Texas, that meant the 1% rate jumps to *gasp* 1.6% of typical net profits.
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State governments can't go bankrupt and the federal government would borrow to California before it ever defaulted. This is a non-issue. The idea that businesses just care about a "low tax burden" is a fantasy.
What is fantasy is the idea that rather than fix the woeful fiscal problems of the state, you expect the federal government to bail out them out. It's this kind of thinking that got us into this mess, and it's just sad to see someone actually still defending it.
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I have not disagreed with any of these. Rather in the case of three of them (2 of them I have no even discussed) I've argued that the situation is far more nuanced than how people usually think of it. That is:
* Has a lower tax burden than CA: In the aggregate its true, but there are no generic businesses so this is useless information. Individual businesses will have to run numbers based on their particular businesses to find out which state is cheaper. Contrary to the partisan rhetoric on this thread, its not always cheaper to operate in Texas.
Again with the politics. Why do you keep bringing it up? Texas overall will be cheaper to operate a business in. Does that mean there might not be an exception here or there? No. But for the vast majority of businesses, Texas will be cheaper.
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* Gets among the top VC $$ in the nation: You have to compare $$ to population, if you do this Texas is average
By dollars it's among the top every year. Per capita is really somewhat irrelevant in terms of overall business climate -- not every Texas city is a technology hub, where you'd typically see VC spent. Although I'd bet Austin does quite well in this category, Texas cities like Houston or Dallas may be more focused on energy or other industries which typically would receive less VC.
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* Has more business friendly regulations: Again no generic businesses, in some cases (e.g., polluting industry) Texas is more friendly for others its no different or worse than Texas.
Again, for most businesses it is more friendly in Texas. For the porn industry, gambling, and marijuana sales and cultivation CA is much more friendly.
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It is clear, its called corporate welfare. Its funny that Texans think its a good thing that businesses can more freely pollute their state when in fact that is just corporate welfare.
Oh the hypocrisy! Making a statement like this while at the same time accusing others of political or ideological bias takes a truly delusional perspective. I suppose the concepts of "business friendly" or "low tax burden" always equal corporate welfare to you. If that is the case, then why are you even here discussing this?
Fact is, CA has descended into THE welfare state of the US. Highest number of welfare recipients. Oh, and per capita too!Moderator cut: link removed, linking to competitor sites is not allowed
#1 California
% of pop. on assistance: 3.30%
2007 spending: $3.28 billion
Total recipients (July 2008): 1,212,893
% Change in past 12 months: 10.4%
Unemployment (May 2009): 11.5%
So you are saying businesses in CA are paying LESS taxes than those in Texas because of deductions?
No and if you actually read what I said you'd know that. I said that you can't compare a profit tax with a gross-profit tax, it makes absolutely no sense. You can't even compare corporate tax rates as the deductions, etc always differ. Furthermore, talking about "businesses" is pointless. Looking at aggregate statistics ignores all the real issues that effect businesses, the fact that businesses in the aggregate pay less in Texas does not really help a particular business. Perhaps the issue here is that you don't understand statistics, I really don't know. Some businesses will pay less in California than they would in Texas, where as others will pay less in Texas than California.
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Originally Posted by atxcio
The difference between a 1% tax on gross profits vs. 8.84% on net profits would mean that only a HUGE difference in gross v net profits would even begin to make things close.
Yep, and if we completely ignore the differences in the respective tax systems Texas would clearly win. But that is partisan hackery, property tax in Texas is much higher than it is in California and offsets the lower business taxes. If you look at total tax burden you'll find that the gap is not that large, Texas is less as a whole but not dramatically.
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Originally Posted by atxcio
No. But for the vast majority of businesses, Texas will be cheaper.
Feel free to support this assertion along with the others you've asserted.
Are all the businesses in California just stupid then...or perhaps just perhaps it is not actually cheaper for them in Texas, etc?
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Originally Posted by atxcio
Per capita is really somewhat irrelevant in terms of overall business climate
Seriously?!
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Originally Posted by atxcio
I suppose the concepts of "business friendly" or "low tax burden" always equal corporate welfare to you.
Being "business friendly" is often short for "we let businesses exploit people and the environment". A lower tax burden can translate into corporate welfare if the tax burden is being displaced to individuals instead, I don't know if this occurs in Texas or not.
But how about this, explain how the "worst state for business" has the largest economy in country and continues to be a hot-bed of start-up activity. Its just bizarre to me that someone would take a ranking seriously that so obviously conflicts with reality.
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