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Debt crisis: Is Texas 'America's Ireland'?
Everybody knows about California's fiscal woes, but why isn't anybody talking about the huge crisis looming in the Lone Star State?
 
Texas has been known as a pro-business, lean-spending, no-union state, so why is it so hard up for cash?
Texas has been known as a pro-business, lean-spending, no-union state, so why is it so hard up for cash?
CC BY: David Herrera

The Texas economy is one of the most important in America, but the state faces a huge budget crisis in 2011 — and no one is talking about it, say Joe Weisenthal and Gus Lubin in Business Insider. Texas is looking at a $25 billion shortfall on a $95 billion, two-year budget that doesn't have "much fat to cut." Think of it as "America's Ireland" — "pro-business, anti-tax, low-spending," and praised for being so, "right up until the moment before it blows up." Is the Lone Star State a fiscal time bomb?

Yes, red states have problems, too: It's surprising that "Texas has just as many problems and perhaps even more," than "liberal blue states" like California and New York, says Ron Beasley in The Moderate Voice. But that's also why we don't hear about Texas: It doesn't fit the conservative storyline. States with little regulation and low taxes are supposed to have weathered this crisis in good shape. But conservatives said the same thing about Ireland, "until it melted down."
"The state budget problem you never hear about"

Texas is doing just fine: It's a shame about "the huge debt problems in Ireland," and the crises in California, Florida, and other states, says Steve Brown in The Dallas Morning News. They make it harder to feel good about the "comparatively good shape" Texas is in. Our real estate market made it through "nuclear winter" and only caught a cold, and unemployment isn't that bad. Texas has its problems, but "the hole we have to climb out of isn't very deep."
"Texas housing market took some hits but is still standing"

The Lone Star State will survive, with a few new scars: "Business Insider makes a number of errors in its analysis of Texas' budget deficit," says Wick Allison in D Magazine, but "the main point of the article isn't far off." Texas won't "blow up" like Ireland did, but cutting at least 10 percent of spending "is going to leave a lot of blood on the floor."
"Texas budget crisis: 'America's Ireland'?"

Texas and Ireland are apples and oranges: Like Ireland today, Texas had its own banking meltdown 25 years ago, says Floyd Norris in The New York Times. But Texas bounced back, thanks in large part to "the fact the American economy was integrated, with a central government that could and would help out." Texas still has that, should a crisis arrive. "Ireland can only wish" Europe was more like the U.S.
"The Texas fix is unlikely for Ireland"

 

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