Economic Growth

With its central location, access to more than 30 ports, more than 300,000 miles of road and 10,000 miles of rail, Texas serves as a premiere logistical hub for the United States. Freight rail acts as a major contributor, with the state moving 385 million tons of goods in 2023 alone. But growing demands and changing infrastructure will challenge freight rail’s ability to support the state's trade activity, a cause for concern for the entire industry.

There is a way to secure Texas’s status as a logistical hub: a Union Pacific–Norfolk Southern merger. This proposed merger would create the first true transcontinental freight rail network under a single system, eliminating the time consuming carrier handoffs that add days and significant cost to cross-country shipments and positioning Texas as a major hub linking freight flows between the East and West Coasts. Strengthening these connections would reinforce the Lone Star State’s role in the national supply chain, improve economic efficiency, and ease pressure on already strained roadway infrastructure.

Texas’ economy and its success are reliant on trade, and to a greater extent, freight efficiency. By investing in infrastructure, the state can maintain its competitive edge in key industries like energy and agriculture. America’s energy industry has become increasingly reliant on freight rail because of its cost-efficient ability to move bulk commodities across long distances, making Texas keenly aware how important an efficient rail system is.

In 2021, extreme weather conditions caused a natural gas pipeline in Texas to fail. Texas’ freight rail system allowed essential fuel to continue moving, keeping homes heated and Texans safe. A Union Pacific and Norfolk Southern merger would create an essential connection of energy corridors and work to resolve potential catastrophe.

Aspirational Americans are being priced out of homes. A recent poll found that 65% of Americans believe they will not be able to purchase a home “in the foreseeable future.” Singles who want to put down roots and families who want to grow are growing discouraged about their future prospects. So when the Senate passed a bipartisan housing bill 89–10 in March, there was reason for cautious optimism. Congress seemed ready to actually legislate, for a change.

But the Senate included a harmful provision that would stymie the construction of new homes.

Buried in an otherwise constructive package that streamlines environmental reviews, modernizes manufactured housing rules, and updates multifamily financing tools is a provision bearing the unmistakable fingerprints of Sen. Elizabeth Warren (D-Mass.) and her colleagues in the Congressional Progressive Caucus. It mandates that institutional investors must sell build-to-rent (BTR) homes within seven years of construction.

This provision is a kneejerk reaction to the current moral panic over investor-owned housing. A false narrative has entered the housing discussion where the culprits are big institutional investors who have bought up all the available housing. It doesn’t matter that the facts don’t bear this out—it only matters that the narrative has gained traction.

And the moral panic over investor-owned housing threatens chaos to the rental market. 

Renting is a legitimate and essential part of the housing market. Who hasn’t rented one or more apartments or houses before finally becoming a homeowner? But someone must first buy and own that rental unit, whether it’s a large or small investor, for rental to occur.

When you have a housing shortage, you need more housing. More of everything. More starter homes, more larger homes, more apartments, more rental homes. Discouraging investors from building rental units is insanely counterproductive in a housing shortage.

But that’s what the Senate bill would do.

Tax cuts aimed at capital produce the most significant economic benefits. A legacy 2001 IPI study by economists Gary and Aldona Robbins shows that a cut in capital gains taxes would be one of two most effective to stimulate the economy. In their study, the Robbinses concluded that a capital gains cut would spur economic growth substantially more than any other stimulus measure, with economic growth of more than $10 for every dollar of lost revenue

Eight months after instituting a $15 an hour minimum wage hike, New York City employers and workers are feeling the pinch. Reports show business operators are cutting staff, cutting hours, and even raising prices. 

This is no surprise.

What did we learn from four hours of 20 Democratic presidential candidates vying for camera time and voter interest? 

1. According to the candidates, apparently the greatest existential threat to America (after Donald Trump) is the large corporations that employ millions of Americans. 

2. Several candidates want to boldly open the door to socialized medicine now; the others want to sneak it in through the back door...

I thought I was already cynical enough. I guess I was wrong.

Over the years I’ve seen elected Republican politicians telling voters about how strongly they stood for “free-market principles” and then vote in ways that are completely contrary to those principles. I’ve seen it so many times that I didn’t think I could be surprised.

But I was wrong.

After meeting with U.S. officials in Beijing this week, China is in turn expected to send delegates to Washington for continued trade talks.

IPI’s Dr. Merrill Matthews joined a panel on CGTN’s The Heat to discuss whether these meetings are laying hopes for a resolution on trade.

Amid rising tensions in U.S.-China trade, IPI resident scholar Dr. Merrill Matthews joined CGTN America’s The Heat where he noted that China’s retaliatory tariffs are indeed highly targeted toward likely supporters of President Trump, while the U.S.-imposed tariffs are hammering all American consumers and the opposite of “draining the swamp.”