Political hot-button issues drive key economic challenges
The biggest challenges facing Texas’ economic future also happen to be the most partisan political topics facing the country: immigration, health care and energy.
The lines between commercial and social issues have blurred over the last decade. Business owners and executives have seen two primary inputs, labor and energy, become lightning rods for activist consumers, profit-seeking shareholders and demagogic politicians.
The decidedly apolitical Center for Houston’s Future is nevertheless stepping into the fray.
“Our job is to look for trouble. Our job is to create debate, but do it in a factbased way,” Brett Perlman, the center’s CEO, told me.
The need for consensus on immigration, health care and energy should be obvious. The birthrate among native-born Americans is below the replacement rate, leaving the U.S. and Texas economies reliant on healthy, foreign-born labor. Every business also needs cheap, reliable energy in a healthy environment.
The center tackled immigration first, gathering data from city, regional and national organizations. Under current law, documented immigrants will hold 43 percent of Houston’s jobs, and undocumented will hold 7 percent by 2036, according to the center’s projections.
But if the federal government slashes immigration by 30 percent, the Houston region will lose $51 billion in economic activity, the study found. Deporting all undocumented workers would knock $36 billion off the economy in the Houston area alone.
“Houston’s economic future is really dependent on getting this immigration issue right,” Perlman said.
He and his staff took their
findings on a roadshow recently. In Houston’s diverse communities, the data reinforced what they already knew. Immigrants are critical for the technology, health care and construction industries, the sectors that drive wealth creation.
Conservative areas found the data less palatable. The center does not advocate a specific immigration policy, but is trying to change the conversation.
“Immigration is a multifaceted issue that is hard to get your arms around from sound bites on TV,” Perlman said. “We think by building a consensus around this idea that immigrants are our economic future, it will drive political change.”
The center is more than an academic exercise. It is an affiliate of the Greater Houston Partnership, the region’s largest chamber of commerce, and funders include some of the biggest companies in Texas.
Neither is Perlman a naïve outsider. Former Gov. George W. Bush appointed him to the Texas Public Utility Commission from 1999-2002, and he spent 12 years as president of Vector Advisers, a consulting firm to telecommunications and electric utility companies.
Perlman was on the Public Utility Commission during the deregulation of the Texas electric power markets. He has a deep understanding of Texas politics and the energy business.
“We’re saying the world of energy is transitioning and there’s an opportunity for us to be at the forefront of that transition,” Perlman said. “Whether you think of that as climate change or whether you think of the 169 countries that signed the Paris Agreement as a market, it’s kind of irrelevant.”
The center hosted a conference examining what a low-carbon future might look like for Houston and Texas. I wrote a snarky column about how some Texas executives in attendance were reluctant to say “climate change” out loud. But Perlman is pressing them to recognize that climate change denial is a losing strategy.
While Houston is known as the world’s energy capital, the city is also home to the largest health care campus in the world, the Texas Medical Center. Researchers and practitioners have become increasingly important to the Texas economy, both as cost and profit centers.
“On the innovation side, a lot of work has been done, but there are enormous problems still in terms of access to healthcare, and Houston has the largest uninsured population in the country,” Perlman said.
The center is holding meetings with health care professionals and businesses, building a coalition, and identifying problems with realistic solutions. Just as they have with immigration and energy, they will publish a report stating the facts and see if they can drain the emotion out of the debate.
Perlman, like many others, is trying to employ facts where provocateurs use hyperbole to push a political agenda. At a time when political tribalism and litmus tests are the order of the day, arguing with reason is an uphill battle.
Perlman and the center are correct and brave to rely on math-based economic data. These are tough and pressing issues, and the future of Houston, Texas and the United States relies on us getting them right.