Lawrence Person's BattleSwarm Blog 4/17/2022
I had no intention of posting another Peter Zeihan video so quickly after Is China Screwed?, but it’s also been a good long while since I did a Texas vs. California update, so let’s tuck in to this video:
https://www.youtube.com/watch?v=UcA_WBVbjKETakeaways:
• Texas doesn’t attract foreign investment.
• Instead, Texas lures development and projects from other states with target tax breaks. “You can stay in Illinois and pay 20% tax or come to Texas, where we’ll give you a 20 year deferment and you’ll pay no tax.” (This is a bit overstated; some companies get those sweeteners, but for most Texas locales simply offer sounder fundamentals.)
• “Everything is inexpensive. It’s where the food comes from, it’s where the energy comes from. The land is cheap. Mexico is right next door. It’s got the major port in Houston. It’s a financial center, it’s an energy center, it’s a manufacturing center, it’s a processing era. It’s all of those things.”
• As global trade becomes more difficult, Texas moves up the value-added chain with more processed and refined goods. Lots of incentive for all sorts of manufacturers to relocate to Texas to take advantage of these intermediate products.
• “Say what you will about the Donald Trump Administration, the renegotiation of NAFTA was a brilliant call, it was probably overdue by 15 years.” More North American content, especially from Texas and Mexico.
• “Texas trades nearly as much with Mexico as the rest of the country combined.” Huge for automotive, but also electronics and aerospace.
• Labor shortages: “Texas is just hoovering up people from across the entire country.”
More:
https://www.battleswarmblog.com/?p=51191
