It seems that with every move the Federal Government makes, it unintentionally makes the argument for Texit stronger. The proof can be found in the new “tax reform” proposal currently making the rounds on the Potomac and its failure to address the real threat to Texas economic prosperity – Federal overregulation.
To understand just how much Texans are negatively affected by the Federal regulatory regime, one only needs to look at two widely published studies on the issue.
In 2014, the Mercatus Center released the Federal Regulation and State Enterprise (FRASE) Index. This index rates the level of impact that Federal regulations have on State economies. For 2013, Texas ranked 6th for impact of federal regulation. In fact, the impact of federal regulation on Texas industries was 29 percent higher than the impact on the United States overall. In compiling historical economic and regulatory data, between 1997 and 2013 the FRASE index has grown by 44 percent for Texas.
The largely overlooked impact on Texans, however, is personal and felt squarely in the pocketbook. In another 2013 study, published in the Journal of Economic Growth, the growth of federal regulations over the past six decades has cut U.S. economic growth by an average of 2 percentage points per year. The result is that the average household receives about $277,000 less annually than it would have gotten in the absence of sixty years of additional Federal regulations. The study concluded that without Federal overregulation the annual median household income would have been $330,000 in 2013 as opposed to the average of $53,000.
Not only does the new tax proposal ignore the destructive regulatory system, it does nothing to address the unequal revenue burden placed on Texans to support the Federal bureaucracy. Highlighted in a 2015 report published by the Texas Nationalist Movement, Texans continue to pay more into the Federal system than the majority of other States, a fact which is conveniently ignored in this proposal.
Commenting on the proposal, TNM President Daniel Miller was indignant.
“The level of dysfunction in the Federal system is on full display as is their total disregard for the underlying grievances which are driving support for Texas leaving the union. The one silver lining to this farce is that it puts Texas one day closer to independence. It’s time to get real and get out”
