Rick Perry may no longer be able to point to the so-called Texas Miracle if he decides to run for President. It turns out that the miracle may have been nothing more than the result of an oil boom that boosted the entire State’s economy and had nothing to do with Perry’s misguided policies. The Wall Street Journal reports that Texas continues to lose jobs in the wake of falling oil prices. JP Morgan Chase economist Michael Feroli had reported in 2014 in that Texas’s economy was in for serious problems based on his analysis of the effect of rapidly declining oil prices. Richard Fisher who was then President of the Dallas Federal Reserve Bank likened Feroli’s report to “bull shit.” But Feroli may be getting the last laugh at Texas’ and Rick Perry’s expense.
Mr. Fisher, who has since retired as Dallas Fed president, argued Texas was no longer tied to the fate of the oil industry. He said the Lone Star State had diversified itself considerably and could withstand the big drop in oil prices and continue to be an engine of growth for the nation.
In a new report, Mr. Feroli was back to say he was right, and Mr. Fisher was wrong. “The only thing dropping in the Texas economy lately is the number of jobs,” he said in a report. The economist said Texas is now seeing the sort of job losses that would normally occur only in a recession.
Mr. Feroli pointed to a report from the Texas Workforce Commission showing the state lost 25,400 jobs in March. He said a proportional loss on the national scale would be if the U.S. lost 304,000 jobs – a recession-like outcome not seen in some time.
Anyone in this state with half a brain (and that would not include most of our politicians) knew that high oil prices were boosting the economy in ways that would not be sustained at say $50 a barrel. You don’t see 20 new hotels on the loop around Victoria during regular times. And you don’t pay $269 a night to stay at a Holiday Inn Express in San Angelo just to eat at the Cork and Pig Tavern. When Schlumberger and Halliburton are laying off tens of thousands of workers, the ripple effects are just beginning to be felt. The Texas Miracle was always a bunch of hooey. Texas leads the nation or is near the top in all the negative categories such as children living in poverty, overall poverty rates, citizens on food stamps, high school dropouts, numbers of uninsured and many other things. Texas Miracle indeed! Rick Perry can go around the nation touting his right wing, anti-consumer, corporate giveaway nonsense all he wants – but nobody is likely to be listening now.