On the campaign trail, former Texas Gov. Rick Perry has been trumpeting Texas' remarkable economic performance, The Washington Post notes,
calling attention to the fact that the number of Texans employed since he took office has grown from 9.3 million to 11.8 million.
However, the shrinking price of oil, while providing savings at the pumps, is decreasing the incentive to pump oil, hurting Texas' mining industry performance and damaging the Texas' impressive economy.
Baker Hughes reported
that in the past year, the number of oil rigs operating in Texas have dropped from 850 to 576, with an attendant loss of jobs.
"If the oil industry starts to flag, that's bad news for the Texas economy and, by extension, for Rick Perry. And it may be starting to flag," the Post reported.
"With oil prices falling 55 percent since last June, they [Texas' critics] argue that the Texas model, a combination of low taxes, less regulation and a sensible lawsuit climate, will show its true colors and collapse."
However, Perry insists that because of Texas' highly diversified economy, financial difficulties in the state from low oil prices will be minimized.
Forbes notes that since 1981, the Texas mining industry, including oil and natural gas, has dropped from 21 percent of the state's private economy to 15 percent and from 5 percent of the state's employment to 2.7 percent, indicating, "Clearly, the state is less dependent on oil and natural gas. Texas’ economy today is more resilient to oil price fluctuations thanks to industrial diversification and pro-growth policies."
Appearing on WHO-TV last month, Perry used Texas' diversification as a plus in his campaign, stating, "Texas led the nation in job creation again last month — 45,700 jobs were created in the state of Texas. Obviously they are shedding jobs in the oil and gas industry, but I think it's a reflection of just how diverse the Texas economy is, and that's what we ought to be looking at in this country. How can we diversify America and get manufacturing to come back in here."
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He stated that approval of the Keystone pipeline, continuing to drive down the cost of electricity and lowering corporate tax rates could create "a renaissance and a revival of American manufacturing" which "is not that far away with the right leadership."
that Texas "became the No. 1 high tech exporting state a year ago, bypassing California," and also cited Toyota pickup truck manufacturing in the state as examples of Texas' diversified economy.
Much, of course, still depends on the price of gasoline, and the Post noted that for the past three weeks, gas prices have seen an upswing.
"For Texas [and for Perry], that's good economic news," the Post noted.
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