Podcast Summary
Power of transparency and freedom: Transparency and freedom enable fact-finding and growth. Bellingcat's use of publicly available resources uncovers hidden truths, while Texas' business pitch attracted companies with promises of low taxes, regulations, and freedom, leading to economic growth.
Bellingcat uses publicly available resources to uncover hidden facts and connect the dots, empowering others to do the same. Meanwhile, Texas Governor Rick Perry's appeal to California businesses in 2013, promising low taxes, sensible regulations, and freedom, led to a massive influx of companies relocating or expanding in Texas. This helped build the state's economy into the eighth largest in the world. However, the success may not last as the influx of companies has trailed off since the Covid pandemic. The contrasting approaches of Bellingcat's fact-finding and Texas' business pitch illustrate the power of transparency and freedom in uncovering truths and attracting growth.
Texas economic freedom: Texas' economic freedom pitch has attracted numerous companies, leading to job growth and increased state revenue, but long-term sustainability is uncertain due to infrastructure issues and rising costs of living
Texas has successfully attracted hundreds of companies to move their headquarters due to its pitch of economic freedom, which includes low taxes, fewer regulations, and cheaper costs. This has resulted in the creation of more jobs and an influx of money into the state. However, the longevity of these benefits is uncertain due to challenges such as power supply infrastructure issues and rising costs of living. Despite Texas' reputation for laissez-faire policies, it still has regulations and infrastructure concerns that could impact businesses in the future.
Texas power grid: Texas power grid struggles to meet increasing electricity demands due to growth and extreme weather events, raising concerns for businesses and impacting cost of living
Texas has experienced remarkable job growth and economic development over the last few decades, leading to an influx of money and foreign investment. However, this growth has put a strain on the state's infrastructure, particularly its power grid, which is struggling to keep up with the increasing electricity demands. The situation has been exacerbated by extreme weather events, such as hurricanes and winter storms, which have caused widespread power outages and damaged infrastructure. These issues have raised concerns among businesses considering moving to Texas, as the state's brand as the energy capital of the world may be undermined by unreliable power supplies. Additionally, the cost of living in Texas has been on the rise, adding to the challenges faced by the state as it navigates this period of rapid growth.
Texas' efforts to attract businesses: Texas is increasing competition with high-cost areas like the Bay Area and New York by opening new business courts and setting up a new stock exchange in Dallas, but faces challenges in maintaining its low-cost appeal due to rising infrastructure costs.
Texas, specifically Austin, is experiencing a significant increase in costs and competition from other high-cost areas like the Bay Area and New York. This erodes Texas' historical low-cost appeal. In response, Texas is making efforts to attract more businesses by opening new business courts and setting up a new stock exchange in Dallas, aiming to compete with the NYSE and NASDAQ. Delaware, long seen as the legal home of corporate America due to its predictable courts, is a model for Texas' new initiatives. However, these strains on Texas' infrastructure and rising costs pose tough questions for the state's future. In summary, Texas is doubling down on efforts to bring more businesses, even as it faces challenges in maintaining its low-cost appeal.
Texas business courts and stock exchange: Texas is establishing new business courts and opening a stock exchange to attract businesses, potentially challenging Delaware and New York's dominance, leading to economic growth
Texas is making a push to attract more businesses by establishing new business courts and opening a stock exchange. The business courts aim to offer predictability and deference to corporate decision-makers, potentially luring companies away from Delaware's long-standing dominance. The stock exchange, in turn, hopes to challenge New York's position as the leading venue for company listings and IPOs. These initiatives could lead to economic growth for Texas through increased tax revenue and corporate presence. Elon Musk's recent decision to reincorporate Tesla in Texas is a notable example of this trend.
Texas Stock Exchange: New Dallas stock exchange aims for fewer regulations, backed by major investors, but success uncertain due to competition and potential threats
The new stock exchange in Dallas, Texas, is aiming to attract businesses with fewer regulations and less interference compared to dominant exchanges in New York. The exchange has backing from major investors like BlackRock and Citadel Securities, but it's still a long shot in a competitive market. Texas is also making other business-friendly moves, such as establishing new business courts. However, there's a potential threat to Texas' appeal as a business hub, which will be discussed further. In summary, the new stock exchange represents Texas' efforts to become a more attractive business destination, but its success is uncertain.
Texas politics and business: Texas, despite promoting a business-friendly image, has been imposing restrictions on personal freedoms and clashing with businesses over political issues, resulting in blacklists and financial retaliation against perceived 'woke' companies
Texas, which has long marketed itself as a business-friendly state with minimal government interference, has been imposing increasing restrictions on personal freedoms and clashing with businesses over political issues. This was evident in a past debate over a voter law when Lieutenant Governor Dan Patrick criticized American Airlines for expressing concerns and urged companies to keep out of politics. More recently, Texas has taken a harsh stance against investment firms, introducing blacklists for those perceived as "woke" and boycotting certain industries, such as firearms and fossil fuels. As a result, BlackRock, the world's largest asset manager, was placed on a blacklist and the state's funds pulled over $8 billion from the company due to its anti-fossil fuel stance. This shows how Texas, while promoting a business-friendly image, is taking a more conservative approach on social issues and is not afraid to retaliate against businesses that voice disagreement with its political stance.
Texas business environment: Texas' stance on social issues creates a polarizing business environment, with some businesses leaving due to disagreements and others attracted by socially conservative values, resulting in ongoing investment and growth.
Texas is experiencing a polarizing business environment due to its stance on social issues. On one hand, the state is taking a tougher line against companies that don't align with its values, leading some businesses to consider leaving. On the other hand, Texas' socially conservative tilt appeals to certain entrepreneurs, executives, and investors, resulting in continued investment and growth. This split screen image is exemplified by the relationship between Texas and BlackRock, which has been both added to the state's "woke investor" blacklist and invested in the new stock exchange. Despite the tension, businesses continue to come to Texas, highlighting the complex and nuanced nature of the state's business landscape.
Texas business hub status: Texas' business hub status could be threatened by growing concerns over social issues and infrastructure, despite its current economic success
Texas, currently a corporate hub and financial hotspot, may face challenges in maintaining its status due to increasing polarization and infrastructure issues. While its right-wing economic approach has attracted businesses up to now, growing concerns over social issues and infrastructure may lead to companies leaving the state. The future of Texas as a business hub depends on which of these elements prevails. The discussion was part of the "Behind the Money" podcast, where they delve into various economic topics. The podcast is produced by Sofia Esmed, with sound design and mixing by Sam Giavinko, and executive produced by Tofur Forhez and Cheryl Bromley. For factual investigations and uncovering hidden truths, tune in to Bellingcat. To support and join the community, visit bellancat.com.