In this episode, Justin Brownlee and guest J.B. Horton, Executive Vice President at the Texas Public Policy Foundation, explore the key drivers behind Texas’s remarkable economic growth and why the state continues to attract businesses, capital, and talent. They break down the policy framework that has fueled this expansion, including low taxes, limited regulation, and a pro-business environment. The conversation also highlights emerging trends such as migration patterns, the rise of “Y’all Street,” and the growing influence of technology and energy in the state’s economy. Finally, they discuss potential risks to Texas’s momentum and what the future may hold if the state maintains its current trajectory.

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Welcome to Financial Planning for Oil and Gas Professionals, hosted by certified financial planners Justin Brownlee and Jared Machen of Brownlee Wealth Management, the only podcast dedicated to those of you in the oil and gas profession to help you optimize investments, lower future taxes, and grow your wealth.

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Welcome back to another episode of FPO Financial Planning for Oil and Gas Professionals.

This week on the podcast, we are excited to talk to J.B. horton of the Texas Public Policy Foundation.

We want to dive into how has the state of Texas grown the way that we have over the last couple of decades?

And what does the present look like?

What does the future look like?

JB welcome to the show.

Thanks so much for coming on.

Thank you, Justin.

It's honored to be here.

Longtime listener, first time podcaster.

Love that.

I want to spend a lot of time on the state of Texas, but first and foremost I would just love to introduce you to our listeners.

And so we'd love to hear who are you?

Where do you come from?

What's your story?

Thanks, Justin.

I'm my professional story is a political refugee, if you will.

I had no intentions of going into politics, but when I graduated from college, I had the opportunity to work for a guy who was running for president as George W. Bush and so worked on his campaign.

Those things you can never predict.

It ended up being an opportunity at the end of the rainbow.

Worked in the Bush administration, had four different roles, and people ask, well, what'd you do?

I say, well, I did what I was told, but I had a great experience during those eight years.

Did a master's degree in the middle of the terms in England, so bilingual, speak English and Texan, and then came back after the masters finished out the Bush administration and then had opportunities to get into public policy.

So I've been on the political side, the governing side, and the policy side.

So fast forward.

I worked at Think tank in Washington, D.C. for many years and then now work at the Texas Public Policy foundation, which has been a fantastic experience, but love public policy because the research can tell you exactly where you should go as opposed to personalities or wins of the day.

So I really love being in the policy side of things.

And that's my story in a nutshell.

Professionally, I love it.

Thanks for sharing that.

It's interesting to look back.

Oh yes.

What was that like for you?

It was fantastic.

I was probably the only person in America that loved that because I was a young paid staffer at the Republican National Committee, did not get paid much, but my job was literally going to be over the day after the election.

And so because it was prolonged, it was job security.

It was job security, which I hated that for the country because it was a very difficult, short transition.

But for me personally, I was like, this is fantastic.

I was young.

I didn't know what to expect.

But it's, it was a great honor to be in those positions.

And then I helped with the transition team, was in the White House for a little while, and it was a great experience overall.

So I have to pause for a minute.

I told my daughter that I would give her a shout out.

So hello to Audrey and the boys.

I also want to say, Justin, thank you.

My boys play baseball and I notice on the fence of the baseball fields the Brownlee Wealth Management signs.

So thank you for supporting youth sports.

Yes, absolutely.

We love doing that and we're pumped to do that in Houston and Fort Worth.

And it's funny you mentioned that.

That's been a big topic in our office.

How do we organize and kind of coordinate the logo on these signs?

Because it's out in the outfield, but that's fun to hear.

Well, let's talk about Texas a little bit, JB Obviously, Texas is continuing to attract enormous amounts of people, capital companies.

From your perspective, what's the reason?

Why does Texas continue to win economically at a rate that's so far beyond most other states?

Great question, Justin.

I think when you boil down to the last 30 years, there's been a lot of consistency that's created what some call the Texas Miracle.

And I would say there's four factors, four main factors from a public policy perspective to create an environment where entrepreneurs and business owners can really flourish.

One is low taxes, one is low regulation.

One is a state of that protects businesses as much as possible against frivolous lawsuits.

So litigation minimization, if you will.

And the fourth one is an educated, educated population.

You have to have an educated workforce to continue to grow, of course.

But those four factors, I would say over the last 30ish years have been very consistent in Texas.

And it's created this economic flywheel that builds upon itself and continues to have momentum as we continue to grow, which is pretty fun to see.

I love the concept of there being four factors because those factors, they certainly work together, but they're not all connected.

So when I think about this question, I am from Canada, Kansas City in Kansas City, kind of similar to St. Louis and some other large or mid sized Midwest urban cities.

They were huge in the 90s.

And it's not as if they're dying by any means, but the amount of growth relative to Texas, it's not in the same universe.

And I think we could also look to Chicago, Detroit and those 30 years ago were two of the biggest hubs in the world and two of the engines that kind of moved America forward.

And Texas has kind of lapped them and certainly Detroit in a massive way.

And what's interesting thinking about your four points, education is a big one.

And Chicago and Detroit have incredible higher level educational institutions, some of the best in the world.

Michigan is arguably the greatest public university in the country.

Chicago, arguably, arguably, arguably Chicago has multiple world class institutions.

Yes.

So yeah, what is it about some of these hubs and power centers of the previous generation that just have not been able to keep up?

Well, think about it.

Let's use that 30 year time frame.

Just, just pretend for a minute that you were a, you went to one of these prestigious colleges you mentioned, and Illinois or Michigan, 30 years ago, you're 22 years old, you graduated college, you want to start your own business.

So 30 years later you're 52.

When you started those businesses that 30 years ago, you were pretty optimistic because of the dynamics you mentioned.

Right.

The economic engine of Chicago was massive.

It was huge.

You could use this in California or New York, same thing.

It was really high growth with, with that time frame.

Thirty years later, there's a lot higher taxes, a lot more regulation.

I would say those two particular states you mentioned, a lot more litigation risk.

And so, you know, if you're in business for 30 years, you're going to probably have done fairly well, but your margins are shrinking and it's tightening and it's hard.

And then when you do a comparison to a state like Texas who's done the opposite of what those states have done, then it becomes a math game.

It's like, wait a minute, look, if I moved my operations to Texas, how much better would I be?

Even if there's a painful cost of moving, there's a break, there's a break even point there.

And so we see that calculation going on all the time.

I would say further, if you're in those states, you don't have any optimism of the state changing their ways.

Look at the debt of Illinois itself.

I mean, the unfunded liability of their pensions is huge.

Illinois is like $250 billion in debt.

And that's not a huge populated state like Texas.

But if you have no, you have no forecast of the state saying, oh, you know, we're going to lower your taxes or regulation, they need more revenue because the promises they made.

And so you're 52 years old, you're like, you know what?

I have 15, 20 more years of earning.

Maybe I should move.

And I would say Texas is a really good bet.

I think you're absolutely correct.

It was kind of jarring not being from Texas, moving here.

So I take a great example on this conversation.

I was a huge, and still am a huge baseball fan.

And so growing up, I always connected Comerica, the Bank to Detroit.

That's was the name of their ballpark, moving to Texas.

Then you begin to realize, oh my gosh, Comerica is a Texas company now.

They just completely moved.

They, they have left Detroit.

They are headquartered in North Texas.

And there are hundreds of examples of that exact dynamic.

Right.

Look at Charles Schwab, look at Tesla, SpaceX.

I mean, there's so many that have moved to Texas because of those factors, right?

Absolutely.

Some key data on that points that I want to share.

So just a few facts around publicly traded companies.

There are about 500 publicly traded companies with their official headquarters in the state of Texas now.

But what's interesting is if you kind of expand the definition.

So, you know, a declared public headquarters is one thing, but you can also have a number of companies that are headquartered outside of Texas, potentially outside of America, and they still have a massive physical presence and a growing physical presence in Texas.

Then the number moves from 500 to.

It's actually not the easiest thing to calculate.

Best estimate is it's about 10 times that number.

JB, you and I both know people in our network who are at the company Alcon.

Before living in Fort Worth, I had no idea what Alcon was.

I had never heard of it.

Most of our listeners, I would guess, have never heard of Alcon, but they do something with contact lenses.

But they are an international company.

They are the, I want to say 400th largest company in the world.

So they're technically headquartered in Europe.

Massive.

Massive Office HQ presence in North Texas.

Massive.

And so that doesn't even get counted as a company that is headquartered in Texas.

And they have an enormous presence.

Fidelity Investments.

You mentioned Charles Schwab.

Fidelity Investments has made a massive play in Texas.

So technically that is a private company headquartered in Boston with a massive and growing presence in the state of Texas.

Yes.

And you're probably wearing Alcon contacts right now.

I'M not, I'm wearing glasses.

But great business.

A huge economic driver.

Of course in Fort Worth I would add to that list.

Goldman Sachs is not headquartered in Texas, but they have more employees in Texas than anywhere else.

Wow.

It's pretty interesting.

So I think we're going to continue to see these trends because of the stability that Texas has provided over the last many years.

But I also predict that that stability will remain in place for at least the foreseeable future.

Right, Yeah, I love that thought.

Now let's continue to kind of talk about capital formation.

How do Texas policies change behavior for entrepreneurs, executive or anyone who's allocating a lot of capital?

Well, capital goes where capital grows.

Right.

There's no discrimination on capital.

And so it looks for places that are friendly to it.

People look for.

I don't think business owners are against regulation, but there's a speed to regulation that's also a factor.

Right.

So it has to be reasonable regulation, but it also needs to be done in a productive and fairly fast manner to make the calculations if it's worth an investment or not.

And so I think Texas has a bias towards more efficiency with businesses.

Here's an example.

If, if you go to Portland, Oregon and you say the word corporation.

Not picking on Portland.

I love Portland, it's a beautiful city.

But the word corporation is kind of a, a bad word in some parts of earth.

A little bit of a cuss word.

Kind of a cuss word.

It's not quite a four letter Corp I guess is a four letter word.

Yeah.

You know, but in Texas that's not a bad word.

And that sounds silly, but it's culturally it's very important for our state leaders and our state culture to embrace business growth.

And I think that's, that's a big part of why capital formation here in Texas is better than a lot of places.

It is interesting you mentioned Goldman Sachs.

If you ever drive through downtown Dallas or kind of uptown and you go to the American Airlines center, you see one of the biggest physical projects happening in the country right now is Goldman Sachs building a new physical hq, a new headquarters.

And that's a great example.

There's something to that, that they are undergoing a project that will take many years to even get done and get filled with people.

And there's something to this idea that all companies feel really confident starting a five year build project in Texas.

They should.

And we can touch on y' all street coming up.

That's the trading will start next month in Dallas with the new y' all Street.

It's huge.

This is, this is gonna be, I think, and I've talked to several experts that believe that Dallas, Texas, will become the center focus, the center part of financial planning, the financial universe of America, in probably 10 years or less.

That's amazing.

And yeah.

Could you share for our listeners, what exactly is Y' All Street?

So Y' all street is a new stock exchange that will be housed in Dallas, Texas.

It has much lower cost than listing on the New York Stock Exchange or the nasdaq, lot lower barriers to entry.

And the environment around Texas is much more attractive than, frankly, New York City.

If you look at the politics of New York City, the current mayor, it's very much the leftward lurch.

There's going to be more tricky regulations to follow, more than likely.

And so the bet to open a new company and those stock exchanges versus a friendly business environment, stock exchange, Y' all street in Texas, I think, will be a huge contrast going forward.

You already have many companies that are already signaling that they are listing on that stock exchange.

And I think that's going to be a fun thing to watch.

That really is something.

It's almost in our industry, we own an investment firm.

It is unimaginable, jb, to think that New York would not be the center of the world.

And I firmly believe you're right, that ultimately that is completely up in the air.

And there is an enormous opportunity for Texas to take a ton of that business.

Yes.

And there's some infrastructure issues in Texas to make that possible, like mediating business conflicts.

Much better.

Having courts that have just passed law.

We just passed laws last legislative session that will help bring a lot of these conflicts to resolution a lot faster.

And so.

But there needs to be more of an ecosystem, ecosystem around the stock exchange that will help, I think, make the calculations of people.

Where do they want to list their company?

Where do they want to do that?

I think Texas will be more and more attractive and it'll be fun to watch.

Like I said.

Absolutely.

Now, before moving on, any final thoughts on just Texas's policy approach and how it impacts hiring, expanding or launching new ventures for companies?

Yeah, that's a great question, Justin.

If you think about just 10, 15 years ago, there was a real push in Texas by Republicans actually to institute an income tax.

And we do not have an income tax in Texas.

And that in itself is a very attractive thing for executives.

But for employees, there's no state income tax.

Where if you compare that to a place like California where they have an 8.84% corporate tax, income tax.

That's very different than the marginal tax rate of our franchise tax in Texas, which is literally less than 10% of that 0.75% for companies above two and a half million.

So those policies are huge advantages for Texas and there's many others.

But I think just the math alone makes Texas we have a compared advantage.

I firmly agree.

You know, some of the facts that we talked about around publicly traded companies having a official headquarters or unofficial headquarters in Texas, those are interesting.

But JB there are an enormous amount of entrepreneurs, very small privately held companies that do incredibly well.

And to your point, there is just an incredible incentive if you just focus on state and local taxes, not having an income tax.

And you know, Texas, we have enormous property taxes and certainly we could, we could probably camp out there.

I don't think we're going to have time in this podcast.

Maybe on a future episode.

I would love to get your thoughts on that.

And property tax is becoming an issue.

But you want to know the beautiful thing about property tax in Texas, despite it being really large, you have some agency in that decision.

Every family, every individual can have some control over that dynamic.

They can rent if they want to.

I rented for a while in Texas, and when we purchased our home, we had agency in how much home are we going to purchase?

And so there is just an incredible advantage.

Even if you're not a giant corporation, even if you're not a publicly traded company like Alcon or a privately traded company that's still massive, like Fidelity Investments, there is an almost unimaginable level of growth and opportunity in that small, small business area.

Oh, I agree.

And we may not have a lot of time to talk about property tax, but that's.

If you look at the number one priority of Governor Abbott.

Number one priority or one of the top priorities of the Lieutenant governor and the Texas Public Policy foundation and the speaker, they're.

It is property tax.

It is too high.

We're losing some competitive edge in Texas.

And it's not just residential property.

It's, it's commercial property.

It's, it's, it is one of the things we really need to address, we have been addressing in the last several legislative sessions, but we want to be even more bold to bring those tax rates down.

Our view at Texas Public Policy foundation is if you compress the tax rates, that helps everyone, including renters.

Renters don't pay a tax bill per se, but they pay rent.

That pays the taxes.

Right.

So it's embedded in the rent and so if you compress the rates, the M and O portion getting a little nerdy, but that would help with all of the Texas economy.

So that's what we're aiming for.

That is such an important point.

And I think there's just so much evidence of what you just mentioned in Texas's growth.

Now, this is a podcast where we talk a lot about the oil and gas industry.

How important, in your view, has energy policy specifically been to Texas's broader success?

The energy sector in Texas has been the most pivotal sector, I think undergirds pretty much everything else in Texas.

It is extremely important that we have the environment that our energy sector needs to continue to flourish.

Low cost, abundant energy helps all sectors flourish in Texas.

So a few years ago, Justin, you'll remember this three years ago, the ESG fight, right?

Remember that huge.

It was everywhere.

It was everywhere.

So that battle was started, the pushback of blackrock, who was virtue signaling and essentially telling oil and gas companies can't have capital.

We're not going to give it to you unless you play ball with our virtue signaling, you know, DEI kind of stuff.

And that, that's not going to fly with Texas.

So the Texas Public Policy foundation, we started the fight with the research along with some friends in West Virginia.

The state of West Virginia did the same.

We helped craft a bill that would push back against all the pensions in Texas.

The state of Texas had about $50 billion that was held by BlackRock, which is not very, it's not a huge amount of money for BlackRock, but it got their attention.

And when we pushed for ESG reform to say, in essence, if you discriminate against oil and gas companies, you cannot do business with the state of Texas, we passed in the law.

Governor Abbott signed it.

Lieutenant Governor was a huge champion of this.

That helped create a ripple effect.

And there were so many other states that jumped on to this effort that it definitely got their attention.

And now, for better or for worse, we have a lot of BlackRock lobbyists in Austin.

For better or worse.

You know, it's interesting you mentioned that we haven't talked about that on the podcast for a while.

Some of the best work that's ever been done on that topic is by Oswald Dharma Doran.

And ironically he is a professor at nyu and he has, I mean, almost single handedly destroyed the ESG argument and just really exposed it as completely fraudulent.

It is pretty Amazing just how much energy has been an incredible force in Texas's growth.

Yep, definitely.

Any other thoughts before we talk a little bit about migration?

You know, Justin, most people think that the energy sector, they would just naturally think it's the largest economic sector in Texas.

And it's not.

Is the fourth.

Believe it or not, I actually did not realize that oil and gas is the fourth largest kind of sector in Texas.

Tell me more about that.

So Texas economy, GDP wise, is the eighth largest economy in the world if it was our own country.

Right.

So there's about $2.8 trillion in our GDP.

The largest sector is trade and logistics.

That's about $550 billion.

The second one is professional services and then manufacturing and then energy, which is interesting, but that shows the diversity of Texas, especially over the last 10, 15 years.

The fifth one, which I found fascinating, is technology.

Technology in the last 10 years in Texas has grown enormously.

But look at just the AI centers that are being built in Texas.

There's about 80 of them right now.

And the amount of manufacturing costs that will spur on is huge.

But ultimately, in the next two, three, four years with AI in the technology sector, it's going to surpass this sector of energy.

But energy is going to be so vital to make those AI facilities work.

So I'm excited.

So the energy sector in Texas last year was about $325 billion, which is huge.

Unbelievable.

But like I said, it's not the largest, but it's the most pivotal because it undergirds everything else.

Absolutely.

It's impossible to not specifically talk about Houston whenever you talk about Texas oil and gas.

I want to read this post from X from John Arnold.

A lot of our listeners know who John Arnold is, one of the most prolific energy traders of all time and a Houstonian himself.

So this is a couple of years ago, but John posted and I will just read it.

Houston has bad weather.

Houston has no natural beauty and little history.

I'll pause.

I love Houston, so I think he's going a little too hard.

But he's also a Houstonian.

He goes on to say, but that is a feature, not a bug.

It means government has to be responsive to the people to create a place people and businesses want to locate.

It must be efficient with taxpayer money and consider trade offs.

It must create an ecosystem that leads to a high quality of life for its residents.

Lose this focus and the city fails.

There is no presumption that residents must acquiesce to the city.

The city must work for the residents.

Turns Out.

There's great demand for this concept.

The city Houston has gone from the 45th largest in the US to the fourth largest in just 100 years.

It's a very simple concept, but one I find wanting or lacking in many legacy cities with more natural advantages.

What a perfectly stated idea.

So Houston and Texas in general has drawbacks.

Texas is never going to be Southern California, Central California, or Northern California.

It will always have massive drawbacks relative to other more beautiful states.

And interestingly enough, that has been a superpower.

Yeah, I think it's really well stated.

And John and Laura, his wife, are great philanthropists as well.

And the Arnold foundation, full disclosure, has been supportive of the Texas Public Policy Foundation.

We're grateful for them.

He's such a unique entrepreneur and has such a great way with words, but that was perfectly described.

Absolutely.

And so, on that note, jb, why are people and companies moving here in such large numbers?

How much of that is tied to policy versus lifestyle?

I have a really good friend, mentor, who, I don't think I won't share his name, but I'll just share what he did.

But he was the former CEO of Behr Paint, and years ago, he decided he was way, way in front of the curve of the migration from California to Texas.

He decided a long time ago that he was getting notices from Sacramento that they didn't want him anymore.

So he moved.

He and his wife moved to Texas and where they live six months and one day.

Typically, they have a beautiful place in Colorado, but were they moving here for the beauty?

Probably not.

They live in Dallas.

Beautiful place.

Were they moving here because of the opportunity to make a better living and to be closer to family?

Yes.

He also is a great acolyte to others in California, showing them the way that, look how much money we're saving every year.

So it became a math issue.

But he and his wife maintained a lifestyle of what they wanted to do.

Now they're retired, sort of.

I mean, he works extremely hard still, but he is retired and does what he wants.

But he did this to have the hybrid of the Colorado lifestyle, which they love, and the Texas lifestyle.

And they can go to California anytime they want to visit.

So it's worked out extremely well for them.

That's just one example.

Okay.

Is it because of beauty that they moved to Texas?

No.

But is it because of our culture and the opportunities?

Yes, absolutely.

I think it's really amazing, too, because it's easy to hear a conversation like this where we're talking about, look at these hundreds of publicly traded Companies.

Look at these DECA millionaires and billionaires that love Texas and they're moving to Texas.

It's not just about the 0.1%, though.

This migration that we've seen over the past 20 years has been the greatest force arguably in the history of the world for middle class people building incredible wealth themselves.

And so, you know, it's often viewed tongue in cheek as a trickle down economic effect.

And the unbelievable thing is the level to which that has happened in Texas is astonishing.

Yes, and I'll back that up with some statistics, Justin.

So in the last 10 years, Texas has tripled in the economy.

The GDP has tripled in 10 years.

Unbelievable.

In that same timeframe, we've grown about 50% in our population.

So it's not triple the population, 50% of the population.

It's about 10 million people.

Now.

100,000 Of those are coming from California a year.

It's the largest migration pattern in the country.

From one state to another, it's about 100,000 last several years.

But yes, the people are making the economy.

But it's that flywheel effect that we're talking about.

It's the good policies and it's the good business environment that those people coming are investing wisely and they're helping the economy grow exponentially.

I can speak about it personally.

My wife and I moved to Houston.

We had a baby and she was pregnant with our second when we moved to Houston originally.

I cannot emphasize how correct John Arnold is.

This analysis on Houston is just perfect.

The city has decided, and there is now, it's not just policy, it's become DNA and culture of Houston, that we are going to serve the people here and we have to make decisions that are in the best interest of our people.

Rather than think about that story from a business owner in Sacramento getting some clear messages, we don't want you here.

How different are those two experiences?

Massive.

When I moved to Houston after spending a few years there and I mean, we still joke, we live in Fort Worth and Houston.

I spend a ton of time down there.

I love kind of joking and telling people.

You know that famous saying about New York City that's everyone knows it, if you can make it here, you can make it anywhere.

Houston is the opposite.

Houston is such a revolutionary, amazing place to do business.

I would say if you can't make it in Houston, you can't make it anywhere.

I love that it's that good.

Well, Texas is growing because it has such cheap housing.

Texas is just such a cheap place to live relative to the east coast or the West Coast.

That's why it's growing.

I would make a strong argument that that is not remotely true today.

Texas is not cheap and it's still growing in incredible ways, right?

Yeah.

Well, that's a great question.

It's great observation.

It's not cheap anymore, but it's comparatively cheap.

If you think about New York or Illinois or California, we keep using those as examples.

The cost of housing there is far higher than it is here still.

That said, it's much more expensive here.

So it's pricing out a lot of the younger people who are wanting to get home sooner.

And we, you know, supply and demand is a real thing.

So the supply and demand factors.

In Texas, you see a lot more homebuilders who are starting to bring on a lot more supply.

Just look in Fort Worth, around tcu, look at all the supply because they know the demand's going to be there.

It's going up fairly quickly.

So I think that that is, that is a challenge.

But it's, relatively speaking, it's still the same equation.

I would say 15 years ago that was a sticker shock decision.

Like somebody from California, they have a three bedroom, two bathroom home, it's worth a million dollars 15 years ago in California and they're selling that and coming to a palatial place that's half price in Texas.

Now, it may not be palatial as much.

Maybe they still make $250,000, not 500,000 from the sell, but it's still a winner overall.

Right.

And I think what that proves is, yes, even though Texas is continually getting more expensive and everywhere in America has been, there are still enormous tax and business advantages that directly help the middle class have a better life.

So even if you can no longer move to Texas and move to Colleyville and buy a $250,000 mansion, even if that is that that window's kind of closed, there's still such incredible advantages.

I think you can ask probably many of your listeners who may have just moved here from another state, they would have a better informed opinion, but I think they would, they would share your, your thoughts there for sure.

Now, as we begin to kind of come toward the end, jb, anything that you think could derail Texas's momentum if policymakers lose discipline?

Another way to ask this, what mistakes should Texas avoid?

There's several big risks that Texas currently faces.

But to avoid future pitfalls, we've got to be very mindful of those four areas that we talked about.

Low taxes, low regulation, an environment to protect businesses and doctors from over litigation, and then educated workforce.

Those four simple things have to always be focused on.

If we lose sight of those, we will lose the economic flywheel that has been created for so long.

Fortunately, there is such a momentum behind it.

I think we're going to be just fine, especially in the foreseeable future.

However, there are forces that will want to undo those things without even thinking about it.

But as far as risk, Texas Public Policy foundation we look at not only what we can do positively in a number of research areas, but what are the risks facing Texas.

And there's several.

But I think three of the biggest ones that I see is property tax burden, which we talked about.

We've got to have a much more competitive property tax.

Second is the grid reliability that most people aren't talking about.

But if you look at our grid reliability, 40% of the grid comes from solar and wind.

That's usually spurred on by investments that are undermined or offset by subsidies from the federal government.

It's not a sustainable model.

They're not bad in and of itself.

They're not reliable.

They're not reliable.

And when you need it the most, those energy, they're just.

We need to have much more of a reliable, steady grid.

So that's a big threat.

And the third one I would say is local debt.

If you look at like per capita, the local government debt, Texas is the third worst in the country.

Wow.

California and New York lead those.

Texas, local debt is huge.

I didn't realize that the state is great.

The state has significant surpluses, and that's why we can.

The state can help with lowering property taxes and things like that.

But local debt, because of all the bonds that are passed and all the, you know, mainly, you know, seemingly good projects, they just add up.

And most people don't think, oh, gosh, we have to pay for these things.

So I would say local debt is.

Is one that we have to get under control.

So those three things, I would say if we get those wrong, then Texas could go the wrong direction.

Absolutely, that makes sense.

Now, what do you think to wrap up if Texas stays on an excellent path?

What does success look like 10, 20 years from now?

Justin, buckle up, man.

I think the next 10, 15, 20 years are going to be huge.

The y' all street in Dallas is going to be huge.

I think the AI centers that are being built around Texas.

Massive.

I think the technology side, not just for Texas, but our whole country, the whole world, is going to be revolutionary in the next 24 to 48 months.

It's going to be something that we can't predict all of it, but it's going to be somewhat disruptive at times.

But the innovation and the ability to be more efficient will be exponentially higher.

And based on our economic model in Texas, I am very optimistic that Texas will be the last few years we've grown 6 or 7% a year in Texas.

Oh my.

I think that's going to be way higher.

That is incredible.

Yeah.

Well, it's going to be fun to continue to watch it.

And just like you pointed out, there's always going to be challenges and potential pitfalls that Texas will have to avoid.

But it's certainly been fun.

And you know, I think we would both say we're incredible benefactors of raising our families and careers here in Texas.

Super blessed.

Best state.

No offense to your homeland.

Best state in the country right here.

Best country in the world.

And I think we live.

Houston and Fort Worth, I would say are the two greatest cities in Texas, to me personally.

Firmly agree with that.

I love that.

Well, jb, thanks so much for coming on the podcast.

And as always, like, subscribe and let us know if you have ideas for future episode podcast at Brownlee Wealth Management.

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