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Category Archives: Tennessee
The New York Times confirms another reason for the Southeast’s attractive growth potential and why increasing numbers of entrepreneurs are deciding to build their businesses in the region: lower state debt burdens. As the attached graph shows, the problem worsens dramatically when one considers many states’ unfunded pension liabilities. (Click thumbnail for “top” 25 states for debt-to-GDP, “Overloaded with Debts Unseen”.)
Not only will such debt levels likely lead to growth-stalling tax increases on the businesses that operate in those states, but some of the states are also responding in “desperate ways” which could undermine investor confidence and result in a credit squeeze similar to that currently experienced by Greece (and perhaps someday by other PIGS.)
State Debt Woes Grow Too Big to Camouflage
By MARY WILLIAMS WALSH
California, New York and other states are showing many of the same signs of debt overload that recently took Greece to the brink — budgets that will not balance, accounting that masks debt, the use of derivatives to plug holes, and armies of retired public workers who are counting on benefits that are proving harder and harder to pay.
Complete NYTimes article here
Original American Enterprise Institute white paper here
UPDATE (3/31/10, 3:08PM):
Having had a chance to digest the original white paper, we are even more pleased than before to report that only one state – NE – has a lower debt-to-GDP % than FL (5th), GA (4th), TN (2nd), NC (3rd), TX and VA (tied for 6th).
A recent study in Science magazine indicates that states with the highest taxes also have the least happy residents. The Wall Street Journal, reporting on the study, argues that the causation is high taxes = unhappiness. While we are certainly sympathetic to that point of view, we also have to wonder if it runs vice-versa, or at least cuts both ways: unhappy people like to raise taxes.
We are… happy. And happy to report that’s true for our region as well. Here is a *totally random* sample of states’ rankings on the happiness of their residents. See below the jump for the entire story.
12. North Carolina
51. New York
Forbes reports that the nation’s professional classes continue to move to the Southeast and Texas:
Net migration, both before and after the Great Recession, according to analysis by the Praxis Strategy Group, has continued to be strongest to the predominately red states of the South and Intermountain West.
This seems true even for those seeking high-end jobs. Between 2006 and 2008, the metropolitan areas that enjoyed the fastest percentage shift toward educated and professional workers and industries included nominally “unhip” places like Indianapolis, Charlotte, N.C., Memphis, Tenn., Salt Lake City, Jacksonville, Fla., Tampa, Fla., and Kansas City, Mo.
The overall migration numbers are even more revealing. As was the case for much of the past decade, the biggest gainers continue to include cities such as San Antonio, Dallas and Houston. Rather than being oases for migrants, some oft-cited magnets such as New York, Boston, Los Angeles and Chicago have all suffered considerable loss of population to other regions over the past year.
The venture capital industry started in the Northeast and is still largely based there and on the West Coast. But given the relative attractiveness of the Southeastern and Texan economies for entrepreneurs, the future of the venture industry may be right here.
The six grant-winning teams are linked to the University of Tennessee, the UT Health Sciences Center, Tennessee Tech, the University of Memphis, St. Jude’s Children’s Research Hospital, Middle Tennessee State University and the Y12 Security Complex at Oak Ridge National Laboratory.