Texas Doing Better?

Paul Krugman says “Not really.”

Unemployment in Texas has, in fact, risen sharply; not as much as in Michigan, Nevada, or California, but more or less comparable to New York and Taxachusetts. Strangely, though, we aren’t hearing about how the wonderful policies of the Paterson administration spared New York from harm.

What is true is that the Texas budget is in relatively good shape. That’s because recessions don’t do as much fiscal damage if you have a weak safety net, so expenses don’t rise much as people are plunged into poverty (because they don’t get any help), and a regressive tax system, so that revenues don’t fall much when incomes collapse.

Some miracle.

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