Governments should have strategic reserves for the same reason families keep a spare tire or an emergency fund: not because it’s exciting, but because it’s useful when something goes wrong.

A real strategic reserve exists for a concrete, predictable reason: The thing you’re stockpiling is something you must be able to access in an emergency. Petroleum reserves hedge oil supply shocks. Medical stockpiles hedge shortages of critical supplies. Even foreign-currency reserves hedge a very specific risk: paying foreign-currency liabilities when markets seize up.

Bitcoin matches none of those use cases. There are no sovereign liabilities denominated in bitcoin, which means there’s no obvious emergency for which “having bitcoin on hand” is the solution. Reserves should be built around the liabilities and risks you’re trying to hedge — and bitcoin’s volatility tends to amplify risk rather than reduce it.

If you want an asset to be there in a crisis, it helps if it doesn’t routinely plunge 50 percent at the worst possible time.

Some proponents argue bitcoin is “digital gold” and will shore up dollar dominance. But that argument collapses the moment you ask the practical question: What liability does bitcoin help the United States pay? What emergency does it solve? We do not run a bitcoin-denominated economy.

In other words, a government bitcoin “reserve” is really government chasing fads and making highly speculative bets with taxpayer dollars. And gambling with taxpayer dollars is not a legitimate function of government.

In late 2025, Texas seeded its new bitcoin reserve fund with $5 million, buying bitcoin at a market price of $91,336. Less than two months later, that initial purchase has lost more than 28 percent of its value. Was that a good use of taxpayer dollars?

Of course, governments buying massive quantities of bitcoin would drive up the price, creating a windfall for existing holders. That’s undoubtedly why some crypto bros are pushing the idea — but that’s cronyism and wealth transfer, not sound strategy.

If a government comes into possession of bitcoin through forfeiture, it should be disposed of transparently and applied to legitimate public priorities. Locking it away indefinitely under an executive order that declares it must not be sold is the opposite of sober stewardship.

America’s strength is not that Washington is a better speculator than the market. It’s that we have the rule of law, deep capital markets, and an innovation economy that doesn’t require the federal government to run a hedge fund.

From the Fort Worth Stockyards website:

Between 1866 and 1890, drovers trailed more than four million head of cattle through Fort Worth. The city soon became known as “Cowtown.”

When the railroad arrived in 1876, Fort Worth became a major shipping point for livestock, so the city built the Union Stockyards, two and a half miles north of the Tarrant County Courthouse, in 1887. 

. . . 

And with the construction of the Livestock Exchange Building, which housed the many livestock commission companies, telegraph offices, railroad offices and other support businesses. It became known as “The Wall Street of the West.”

And in 1907, the Fort Worth Stock Show and Rodeo began.

But today, a different kind of stock market is stampeding to Texas.

The Texas Stock Exchange (TXSE or “Y’all Street”) is officially registered and plans to begin trading in 2026. More than 50 years ago, the Texas Legislature commissioned a study into the feasibility of a Texas securities exchange. And, of course, in the intervening time, the Texas economy has diversified, and Texas has become a go-to destination for corporate relocations as well as new start-ups. 

With more business-friendly regulations, a belief in both the freedom to succeed and the freedom to fail, and with one of the best airports in the world centrally located midcontinent, Texas is the place to be.

Not to be left behind, the New York Stock Exchange has moved quickly to have a presence in Texas as well. NYSE Texas obviously has a head start on the Texas Stock Exchange, so it will be interesting to see how that competition shakes out.

And just a few days ago, Nasdaq announced Nasdaq Texas at an event with several leaders in the oil and gas industry.

None of this is an accident. The Texas Constitution now bans taxes on securities, and other recent laws make it more difficult for political activists to harass corporations through ideological shareholder resolutions.

And the new specialized Texas Business Court system is designed to handle complex business disputes in an expedited manner separate from the overburdened district courts. Judges have commercial litigation experience, and this provides Texas businesses with streamlined processes and reliable outcomes.

Many companies, including Tesla but most recently Coinbase, have announced that they are abandoning Delaware and reincorporating in Texas because of lower costs and better legal protections. 

As Democrat-led cities and states become increasingly inhospitable to wealth creation and business formation, and even unsafe and unpleasant for daily life, Texas is reaping the benefits. Of course, this will present challenges as well, but signs are good that Texas is up to the job.

There’s an interesting tension in free-market economics related to businesses.

First, businesses are forms of free association in which people voluntarily pool their resources to accomplish more together than any of them could separately.

Second, businesses profit most by serving customers, not by abusing them. So we start with an assumption that businesses are good things, not bad things, because businesses allow people to better themselves by serving others with products and services they want.

So business is good. Generally.

But, as even Adam Smith observed, sometimes businesses misbehave. Smith wrote “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

That’s why we at the Institute for Policy Innovation assert that we are “pro-market, not pro-business.” We want easy business formation, but we also want competition and the freedom of success or failure.

In a free market, with competition, ease of entry, and possibility of failure, businesses can only harm consumers if enabled by government protection and regulation.

That’s why conservatives and free-market advocates support the consumer welfare standard for government regulation, rather than a European style competition policy.

Which brings us to Texas, and tickets.

Those who buy tickets to live events are generally pretty unhappy with the fact that they are held hostage to Ticketmaster\Live Nation tyranny. In retrospect, this is a merger that has harmed consumers. But beyond their control of the first sale of tickets for live events, the Ticketmaster/Live Nation colossus does everything it can do prevent ticket purchasers from reselling their tickets, or to make it prohibitively troublesome or expensive.

This was an emerging issue twelve years ago, when IPI wrote a paper on the issues of the importance of secondary markets for tickets. If anything, the problem has only gotten worse.

Secondary markets are an important component of a free market, and if you buy a legitimate ticket to a live event, you should be able to transfer it to whomever you choose, however you choose. But the Ticketmaster/Live Nation demogorgon wants to control that as well.

Thankfully, excellent bills have been introduced in the Texas Legislature during the current session that would protect the rights of ticket purchasers to both buy and sell tickets on secondary markets, and make all fees included in “up front” pricing. House Bill HB 3621 had its first hearing Wednesday April 23^rd, while it’s Senate companion SB 1820 awaits a hearing.

Issues like preserving secondary markets for tickets are important because they force elected officials to choose between being pro-business or pro-market. More cynically, between being pro-entrenched interests or pro-economic liberty. The Texas Legislature should choose markets and economic liberty.

Today's TexByte was written by IPI President Tom Giovanetti

Artificial Intelligence (AI) is the latest technological “thing” that’s going to change the world—unless it destroys it.

Or at least, that’s the impression most people get from major media and social media channels.

The Texas foster care system is infamous for failing its wards. The system is so flawed that in 2015 it was found in violation of the 14^th Amendment, which guarantees the right for people to be free from an unreasonable risk of harm while in government custody. The reason: Kids entering the Texas system came out in worse shape than when they entered. Many kids go in because of physical abuse at home, so how bad is the system?
 
In 2022, more than 3,100 foster kids went missing. And every year around 40 kids die while in the care of Texas. What more will it take to get the state to take seriously its responsibility to children in its care?
 
Some changes were made this legislative session, but the state Legislature decided to move in the direction of laws to favor parents in child abuse investigations, hoping that this will reduce the number of kids entering state care. But at least a new mandate requires that the state provide foster kids duffel bags and backpacks to transport their belongings, instead of the trash bags they had been providing.
 
Enhanced parental rights and backpacks aside, some will still end up in foster care, and they deserve to be safe and secure, not made worse off. Utilizing modern technology and the private sector could save lives and improve care.
 
Texas did partner with the private sector, a tacit admission that the state was failing on its own. The community-based care system now being implemented is a collaboration model between the Departments of Family Protective Services and local private sector non-profit organizations.
 
But when it comes to using the best technology to protect kids the state simply fails. The current system, built 30 years ago, contributes to welfare services losing track of kids, because caseworkers routinely have to track down physical documents in an intensely paper-based system. As the federal court said, this system “creates opportunities for important safety-related tasks to ‘fall through the cracks.’” But eight years later, same system.
 
Yet the state has no plans to upgrade to something effective even when less expensive, easy options are available. Gone are the days when an expensive custom software build was necessary. Software-as-a-service provides a license to use software on a common platform that can still be molded to unique needs. But even these improvements would require the state to devote adequate resources, which has been a chronic problem.
 
Given the introduction of another state entity into the mix with the non-profit organization, this sort of flexible platform would also help safeguard the family and child information that should be made available electronically. A new system would also empower social workers with the best individualized data available to help them stay ahead of potential problems, not least to help end the ongoing crisis of lost kids.
 
If only a fraction of the attention that state legislators have paid to demonizing “Big Tech” was focused on where the state can directly help at risk kids using technology, much good could already have been done. Then again, populist demagoguing is easy and cheap, and caring for kids is hard and costs money.

Many outside of Texas enjoy mocking Texans with “I know, I know, everything’s bigger in Texas,” but the reality is that Texas is really pretty darn big. The US Census reports that as of 2021 Texas has more than 30 million people, living in more than 12 million households spread out across more than 261,000 square miles. As of the census, 87% have broadband at home.
 
More recently, BroadbandNow.com indicates that 92.5% of the Texas population has access to wired or fixed wireless broadband. Reaching that many people in a large and diverse state is no small feat, but the need, or value, for all Americans to have access to broadband became clear during the COVID-19 pandemic. Understanding that value motivated the U.S. Congress and the Texas state legislature to allocate billions of dollars to help ensure that all Texans have access to broadband.
 
Texas will receive $3.3 billion of federal funds made available from the Infrastructure Investment and Jobs Act specifically to expand access to broadband. This year, the Texas legislature took a half measure and allocated an additional $1.5 billion to expand internet availability across the state through a new Broadband Infrastructure Fund but only if voters approve it at the ballot box in November. This is all in addition to billions more via other federal funds of which Texas will get a share.
 
Exactly where the Infrastructure Act and state funds will go is still unknown. The Texas Broadband Development Office will allocate the funds and presumably the money will go to communities where it is most needed to extend access. But this won’t happen automatically.
 
Strong guardrails on allocation and spending must be in place to guarantee that access is in fact expanded, as opposed to money being spent to “overbuild” in areas where Texans already have access. Unfortunately, making sure that the most effective technology is deployed is one guardrail that has already been compromised.
 
The Texas legislature passed legislation making fiber a priority for investment. But in some areas fiber is not the right answer and cable or fixed wireless may be more appropriate. Regardless, legislative mandate of a particular technology is almost never a good idea. In this case the result will be a higher cost of fiber deployment and therefore fewer people served and money wasted.
 
Another distraction is the desire by some to lavish cash on electric utilities so they can build a “middle-mile,” and pad their bottom line. The folly of this idea is fully described by IPI in a recent op-ed.
 
This huge tranche of taxpayer dollars needs to be spent wisely and leveraged with private sector spending so that more Texans actually gain access to broadband. If bureaucrats and politicians get distracted with fanciful ideas and cronyism the losers will be those Texans who have yet to join the digital economy.

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.

There is a bill before the Texas Legislature that explicitly makes new competition illegal in an industry. It locks in the existing companies doing business in Texas, and makes it illegal for a new company to enter that marketplace. Can you imagine?

Conservatives say they hate crony capitalism, but a bill that makes it ILLEGAL for a new competitor providing a legal product or service to enter a market takes crony capitalism to a whole new level.

And the bill just passed out of Lieutenant Governor’s Dan Patrick’s Senate 30-1. Every single supposedly free-market Republican senator voted in favor of it, except for Senator Bob Hall. Now it’s headed to the Texas House.

The House bill is HB 3995, by Rep. Matthew Phelan, and the Senate bill is SB 1938, by Sen. Kelly Hancock. These bills lock in all future electric transmission projects what’s that to a cartel of the existing players. Here’s the language direct from the bill:

“ . . . a certificate for a new transmission facility that directly interconnects with an existing electric utility they all do may only be granted to the owner of the existing facility.”

That’s a heckuva nice benefit for the existing companies, and it’s about as anti-competitive as you can get.

A basic principle of free markets is low barriers to entry for new businesses. That’s because competition is good for consumers and for the economy. Competition drives innovation, customer service and low prices. So in a free market economy we want to make it easier, not harder, for new businesses to enter markets and compete.

This bill makes it IMPOSSIBLE.

You can’t justify this legislation from a free market perspective, but that hasn’t stopped some from trying. In an April 17 piece in the Dallas Morning News, Bernard Weinstein (who we very often agree with on energy policy), in a single paragraph, claims that we don’t really want competition in Texas and that competition is bad. Weinstein says, “the adoption of competitive transmission would open up a Pandora’s box.” So Weinstein believes in state managed electric transmission rather than a free market, competitive process. He likes it because it creates “regulatory certainty.”

Well, regulation ALWAYS creates certainty. That’s not a justification for it. One of the certainties this regulation creates is the certainty that established players won’t have their businesses disrupted by competition. That’s an argument for a government-managed economy rather than a free market economy, and I thought Texas preferred free markets.

Competition drives prices lower. If the Texas House and Governor Abbott approve of this crony capitalist windfall, Texans will inevitably pay higher prices for electricity than otherwise. In a free market economy, we always choose competition over “regulatory certainty.”

And, oh, did they come. From all over people flocked to Austin for the lifestyle, low cost-of-living and the tech boom—and in search of opportunities made possible by Texas’ low-tax and lite-regulation mindset.  

The transplants helped grow the capital city’s wealth and population to levels once unimaginable. University of Texas students used to say with a sigh that Austin sure is a great city, only you can’t make a living there. Well, you can make a living there now, but you may not be able to make a house payment. 

The median price for a single-family home in Austin is up 6 percent from last year, to $390,000, according to the Austin Board of Realtors. Compare that to the $280,000 median list price for a home in Texas, according to Zillow. 

Prices over the last five years are up 42 percent, with median income only 17 percent higher for the same period. 

What Austin’s got is a limestone-and-live-oaks version of a truly national problem. The recent revival of formerly stagnant or declining U.S. cities, under the magic touch of a hot-thinking, large-living “creative class”—urbanist Richard Florida’s term—spooks anyone concerned about “gentrification” and middle-class flight.  

A well-functioning city needs all kinds, hence the growing demand for “affordable housing.”  Austin hopes to address that problem with a $925 million bond issue, due to be voted on in November. It contains $250 million for land purchase and development of rental housing. 

It’s never a good idea to sneer at well-intended attempts to lend a hand, which is what the Austin City Council is trying to do. Like other cities, such as Los Angeles, Portland and Seattle, Austin is betting that government action can constructively address today’s housing problem. It’s a bad bet. 

A local task force believes the city is short 48,000 housing units. The estimated cost to build them is over $6 billion. It would appear the city needs something more here than $250 million. 

The urban problem is real, but recognition of reality is not necessarily a summons to government to drive up in a firetruck and put out the blaze. The federal government created various low-income housing programs decades ago. They have been an unmitigated disaster. There is no reason to think that Austin—or Los Angeles or Portland, for that matter—will do a better job. 

Austin, music capital of the state, has the Transition Blues. Skyscrapers line a horizon formerly dominated by the Capitol dome and the UT Tower. Luxury homes better characterize Mt. Bonnell than the blankets favored by romantically inclined UT couples in a long-gone era.

All over the country, such changes have taken place amid the retreat from manufacturing and its embrace of “creative” enterprises—stuff you do with your head instead of your hands. The people who work with their hands do so mostly as toilers in the so-called service industry: retail, hospitality, transportation and so forth. 

The money isn’t grand; often it’s barely adequate—$25,000 a year and up. Numerous cities feel hollowed out: rich people at the top, service workers near the bottom; no middle class to speak of. And shortages of good cheap housing. 

Life churns at a fantastic pace in the 21^st century: too fast for government to figure out what’s happening, far less to lumber over and do anything useful. Far faster and more reliable—in the context of existing conditions—are the judgments and movements of the marketplace. Not infallible—just smarter and quicker.  

“The challenge,” says Aaron M. Renn of the pro-free market Manhattan Institute, “is the reinvigoration of America’s flagging middle class.” How, please?  

Renn doesn’t underrate the difficulty the problem presents—one new to our national experience. We might reduce low-skilled immigration, he says, in favor of higher-skilled immigration. He mentions the possibility of opening access to better-paying jobs—electrician, barber, taxi driver, for instance—by easing licensing restrictions. Raise the minimum wage to $15 an hour? What a great way to kill jobs worth less to an employer than $15 an hour. 

Government giveaways—large housing subsidies, say—are never a convincing substitute for government policies that reward the creation of well-paying jobs, starting with low taxes and a pro-marketplace mindset. “Keep Austin weird,” goes the famous slogan. Here’s a really weird idea for Austin: Give the marketplace as much breadth and scope as possible and prepare for an agreeable surprise.

In Texas, some conservatives wrongly think that opposition to high speed rail is a conservative principle. It’s true that high speed rail projects have typically been publically financed with taxpayer dollars and cost and ridership projections have typically fallen short, necessitating perpetual taxpayer subsidies. But those are problems with nearly all government programs, and unrelated to high speed rail technology itself.

There is a serious effort being mounted in the Texas Legislature to target and stop the Texas Central Rail project. Whatever the motivations behind this effort, it cannot be said that opposition to the Texas Central Rail project is based on conservative principles. In fact, those trying to stop the Texas Central Rail project in Texas are actually violating conservative principles.

Conservative principles emphasize that:

• Government shouldn’t favor one player, business model or technology over another. It’s the job of markets, not government, to determine winners and losers. So when conservatives turn to government to kill high speed rail in Texas, they are actually violating, not asserting, conservative principles.

• Government should encourage private investment. It is private investment, not government spending, that creates economic growth, new jobs, and new products and services for consumers. Because it is privately financed, the Texas Central Rail project does all of that, and the alternative to the project is ironically more taxpayer financed transportation infrastructure.

• Taxpayers should not bail out private investments. Conservatives are still rightly angry about the bank bailouts, but Texas taxpayers will be under no obligation to pay for or bail out the rail project if it fails, and the project won’t break ground until and unless the private investors have sufficient confidence in the success of the project.

• Eminent domain is necessary but limited by the Fifth Amendment to the U.S. Constitution. The Constitution allows for private land to be taken for public use, so long as the compensation is just. The founders knew that a growing country would need that power, but it also created parameters to limit abuse.

Many conservatives in Texas are clearly confused about transportation policy. First, they were champions of privatization through toll projects, because they didn’t want to spend taxpayer dollars. Then, conservatives decided they didn’t like toll projects after all. Now, some are trying to stop a privately financed high speed rail project with no taxpayer liability.

You can finance transportation infrastructure through taxpayer financing or private financing. Those are the only two options. Given conservatives’ preference for private investment and risk-taking over government spending, they should be thrilled that the private sector is taking on this project, rather than the state.

Someday there will likely be a rail line connecting Dallas to Houston through Austin. The only question is whether it will be a private, free-enterprise project, or a TXDOT-managed project that taxpayers will be paying for forever.

This TEXByte is condensed from an IPI Ideas publication.

Across the country, states have been innovating with health care by removing restrictions to telemedicine, or telehealth, thereby lowering costs for citizens and making access easier. Some states have been willing to move further and faster in allowing patients and doctors the options and freedoms provided by greater use of technology in medicine. 

But as we noted earlier, Texas has lagged in allowing telehealth options, receiving a mere D+ grade (including two Fs) from the American Telemedicine Association in its “State Telemedicine Gaps Analysis.” Yet the value of telemedicine has been demonstrated on multiple occasions. 

Infusing technology in health care can save money and provide great benefits to patients beyond better health outcomes, such as limiting the need for the elderly to travel to a doctor’s office for a routine visit, and providing those in rural areas with improved services.  

As just one example, according to the American Heart Association, heart disease is the No. 1 killer in Texas—more than 38,000 people a year. Nationwide the AHA reports that the number of those with heart disease will grow by 45 percent, and will cost more than $1 trillion. Because the use of telemedicine can help curb this trend, the AHA has called on policymakers to enable telehealth and mobile health technologies to help those who may not otherwise have access to convenient services. 

That Texas has been so reluctant to allow health innovation to flourish is certainly surprising for a state that Chief Executive magazine ranks as the No. 1 best state for doing business. But perhaps this ailing patient is recovering. 

State Senator Charles Schwertner, M.D., a surgeon, has indicated that he will introduce legislation that would eliminate the requirement that a patient must have a face-to-face doctor meeting before being allowed to use telehealth services. Texas has stubbornly remained one of the last states to limit a patient’s freedom and a doctor’s services in this way. 

Taking steps toward a fair and open marketplace for telemedicine has already been cheered by the Texas Medical Association, “TMA applauds Senator Schwertner for his leadership in helping us all pursue a compromise telemedicine bill on our patients' behalf. While we are pleased that the seed of a legislative agreement is in place, we acknowledge that more work remains before it can grow into a new law to guide this valuable form of patient care for the future." 

Reportedly there are still details to be worked out in the Senate proposal, such as the role of telephone only care, which will hopefully be addressed with an eye to the future of innovation and benefits for consumers. Restrictions, such as what exists for now in Texas, simply increase cost, restrict opportunity and choice for patients, and smack of paternalistic big government. Telehealth empowers patients to choose, without disparity in access to care. Hopefully, Texans will be allowed such freedoms and opportunity soon.

It’s hard to imagine a school funding mechanism that is more broken than the one employed by Texas.

On May 13, the Texas Supreme Court upheld the constitutionality of the Texas public school finance scheme, but no one thinks it’s a good system. The court had some choice words: byzantine, imperfect, and Daedalian—the latter a reference to the mythic Athenian architect who built the labyrinth for King Minos designed to trap all who dared enter. None of those descriptors was meant to be complimentary.

Despite the criticism, the court correctly refused to intervene, finding that the antiquated system met the minimum constitutional requirements. Justice Don Willett, writing for the majority, demurred to the Legislature, noting that “it is not the Court’s role to second guess or micromanage Texas education policy or to issue edicts from on high increasing financial inputs in hopes of increasing educational outputs.”

But the court said the state’s 5 million school children “deserve transformational, top-to-bottom reforms that amount to more than Band-Aid on top of Band-Aid.”

Currently, public schools get local, state and federal funds. Tier I funding is provided by local property taxes and state funds. Districts are paid a set amount per student, which is calculated using the district’s average daily attendance and adjusted by factors such as the district's location in the state, the size of the district and the relative wealth of the people in the district.

Tier II funding allows districts to obtain additional funding by adopting a slightly higher tax rate and is based on the number of students in weighted average daily attendance. School districts call these extra taxes “golden pennies,” which are pure revenue, and “copper pennies,” which may be subject to recapture depending on how wealthy the district is.

If all this sounds rather complicated, that’s because it’s a tangled mess of disjointed and misaligned puzzle pieces—in other words, there is no way to fix it piecemeal.

School choice might just be the motivation legislators need to tackle the daunting task of education financing reform, and it's already one of the state's top priorities for the 2017 legislative session. However, legislators would be hard pressed to build school choice onto the current funding scheme.

Regardless of the specific implementation—school vouchers, education savings accounts, tax-credit scholarships or tax credits/deductions—school choice makes public education financing more dynamic because funds follow students to the schools and districts of their choice.

Tacking on school choice to the current system would only compound its problems.

As broken as education funding in Texas is, school choice is poised to be the carrot legislators need to make substantive changes to the current system.

According to the Kaiser Family Foundation, by a margin of 2 to 1, physicians see the increased use of heath information technology as a positive for overall quality of care. As has been demonstrated on multiple occasions, infusing technology in health care can also save money and provide great benefits to patients beyond better health outcomes, such as limiting the need for the elderly to travel to a doctor’s office for a routine visit.

Yet Texas struggled to get an average of a D+ grade (including two “F”s) from the American Telemedicine Association in its most recent “State Telemedicine Gaps Analysis.” How can that be when business indicators such as Chief Executive magazine ranks Texas as the #1 best state for doing business? The challenge seems to be the Texas Medical Board, an unelected group of 19 regulators. 

The board argues that the limitations they put in place to restrict the use of telemedicine are necessary to protect citizens. However, the public has overtly rejected that nanny-state rationalization. A year ago the board decided to place a new restriction on consumers’ choice by requiring a face-to-face visit before a doctor could write a prescription. The board created that regulation by a vote of 14 to 1, ignoring 95 percent of the filed comments that opposed the restriction. 

Such rules do not even achieve the self-proclaimed goal used to justify such restrictions: to “protect the safety of the public.” Texas-based telehealth company Teledoc has performed 1.25 million patient visits and has not had even one malpractice claim. Can any other health care provider boast the same?  

And what then about the patient safety, the public safety, of those who are prohibited from accessing telemedicine’s advantages?  

These sorts of rules increase cost, restrict opportunity and choice for patients, and smack of paternalistic big government. Increasingly, lawmakers and regulators mistakenly believe that they must be ahead of innovation, regulating and legislating before new products or business models even emerge—denying the right to try. They certainly believe they should be ahead of the public and its views. This approach is the very antithesis of “permissionless innovation” and instead requires government to grant permission before experiment, innovation and creativity can move forward—a game of government controlled, regulatory “Mother may I?” This approach ultimately replaces the wisdom of the American people with the judgment of a handful of politicians and bureaucrats. 

Too many regulators, bureaucrats and politicians have come to believe that they have a superior view, better judgment or a more advanced intellect than the rest of the nation. That is a self-delusional fantasy. The people will speak to issues in their time, and the government class should be ready to act when they do, rather than pretending they have answers to questions not yet asked.

On April 14, a 21-10 vote sent state Senator Troy Fraser’s Senate Bill 931 to the Texas House, calling for the end of the Renewable Portfolio Standard and Texas’ Competitive Renewable Energy Zone (CREZ) initiative. These mandates have been responsible for the growth in wind energy that Texas has seen over the years, but at a price to consumers.

In 2005, the Texas Legislature modified its Renewable Portfolio Standard (RPS) by setting a goal of reaching 10,000 megawatts from renewable sources by 2025. Texas’ CREZ initiative was put in place to spark wind energy investment and help reach this goal, which is why from 2007 to 2013, wind’s share of energy generated in Texas increased from 2.9 percent to 9.9 percent. Transmission companies spent $6.9 billion to build these CREZ lines in Central and West Texas, and this cost is being repaid by Texas consumers in the form of added fees to their electricity bills—essentially ratepayers are subsidizing the expansion.

The RPS 2025 goal was surpassed five years ago, and companies have spent most of the $6.9 billion to build CREZ lines by last December.

SB 931 rightfully sends the message that it is no longer necessary to continue to force Texas consumers to pay for new lines or force power generators to meet renewable energy quotas. However, since the wind energy production goal was met 15 years early, in 2010, could it have possibly reached the 2025 goal without the mandates and ratepayer subsidies?

If the fate of wind energy were left up to the market rather than forced on us by our lawmakers, might it have still reached its goal?

Whether it is correcting a wrong or ending a “mission accomplished” as Senator Fraser stated, ending these mandates through Senate Bill 931 is a good step forward. Too many times we have seen temporary government programs continue unnecessarily after reaching their goals and consequently force citizens to pay more, whether through higher bills or taxes. Interestingly enough, Senator Fraser championed these two mandates a decade ago, so he should be commended for recognizing when it is necessary for them to end, and acting on it. We will see how the House proceeds.

Gov. Greg Abbott ruffled feathers a few weeks ago when he implied that he had a strong view of the power of state law to supersede municipal regulations that restrict the rights and freedoms of Texans. 

Speaking to the Texas Public Policy Foundation, Abbott warned that, despite the dramatic differences between Texas and California policies at the state level, some Texas cities seemed to be embracing California’s highly regulatory approach on issues such as tree ordinances, bans on plastic grocery bags, fracking and the like. He warned that such a “patchwork quilt of bans and rules” threatens to erode the “Texas model.” 

Some were clearly put off by Abbott’s comments, including some of his conservative supporters. There were even suggestions that Abbott would be an “imperial governor,” simply because he seemed to not assert the sanctity of “local control.” 

But Abbott is correct. His observation is astute and also has the benefit of clarifying an area of confusion among many regarding the supposed sanctity of local control. 

It’s absolutely true that the closer political power is to the people, the more responsive political power tends to be. But that can be a two-edged sword. Local governments are at least as capable as the feds of passing laws and ordinances that violate the presumption of liberty in the Constitution. If I may be permitted a bit of hyperbole, tyranny isn’t OK just because it is approved by a majority of your fellow townsfolk. Rule of law, not local control, must be the governing principle. 

I was reminded of this confusion a few months back while addressing the then-proposed Denton fracking ban. While I was being interviewed by conservative talk radio host Mark Davis, Mark expressed a common sentiment, saying: “I agree with you that banning fracking is a bad idea, but I also believe in local control. Shouldn’t local towns be able to do what they want? Don’t we believe in local control?” 

No, actually, we don’t. The governing principle is rule of law, not local control. And in our system, rule of law is most often on the side of the state. 

Remember, the states were here first. The states created the federal government, and in the federal system created by the states and enshrined in the Constitution, the states sit atop the chain of political command. The Constitution, written and approved by the states, delegates only limited powers to the federal government and reserves the rest to the states and “to the people.” 

Since the states created the federal government and create their own local municipalities, the states determine which powers are allocated to each. So a state has the power to limit the power of municipalities, and to pass new laws that limit municipalities further, if necessary. There is no sacred principle of “local control” that supersedes this structure of legal authority. 

Don’t make a fetish of local control. This will become increasingly important as our Legislature attempts to restore some sanity to our tax system, especially to the property tax system. Wrongheaded belief in the superiority of local control has been used by municipal lobbyists in Austin to amass an excessive amount of influence over state policymaking. 

And finally, if conservatives still think local control is some kind of sacred principle, I ask you: Should a city in Texas be able by vote to exempt itself from the state’s limitations on the provision of abortion?

I didn’t think so. 

Well, several of them, and we’re not alone. States like Pennsylvania (birthplace of the U.S. oil industry) and New York are torn by disputes over the outright prohibition of hydraulic fracturing for natural gas at the state or local level. A lot of nuttiness and needless frenzy about drilling goes on today. And so Texas Rep. Van Taylor (R-Plano) tries to clarify the issue.

Taylor’s HB 1496 classifies a mineral interest as real property on which no political subdivision could prevent or prohibit “the development of an oil or gas well that has been permitted by the Texas Railroad Commission…”

Should any entity impose an absolute ban on local drilling, a mineral owner feeling deprived of his private property rights—and why shouldn’t he feel that way?—could institute condemnation proceedings. “If cities confiscate property, they should compensate the owner,” Taylor explains, with logic hard to contest.

A March hearing on Taylor’s bill produced some dissonance as to the objective of protecting property owners from local officials who presumably cherish their present right to cave in to environmentalist demands.

Officials in the northeastern states embrace that right with might and main, oblivious, seemingly, to the good news of America’s comeback as an oil-producing nation. In just five years:

• Domestic oil production has risen 40 percent;
• Imports are dropping fast; and
• “Energy independence,” whether or not it ever actually gets here, looks less and less all the time like a dream induced by peyote.

What sticks in the craws of various northeasterners is the certainty that carbon-bearing petroleum won’t yield pride of place to wind and solar alternatives. Texans—to whom oil is the energy equivalent of mother’s milk—aren’t that far gone. But it pays to look ahead. The idea of oil and gas as property rights, like buildings and homes, further tickles the Texan sense of entitlement to the fruits of ownership.

Taylor’s way of proceeding, whatever head-buttings it may have occasioned in Austin, looks like the way ahead for Texas.

What does the free market say when a business plan just isn't cutting it? Try a different plan, that's what.  Texas Gov. Rick Perry's push for a $10,000 undergraduate degree at state colleges and universities comes from government, sure, but its nerves and neurons are classic free enterprise.   Says the governor:  Let's be willing to break a few molds; try something fresh; see what happens.

The result: new approaches at 10 Texas colleges to the enormous challenge of giving students first-rate educations at a reasonable cost.  That's more than American college students in general are presently getting as student debt rockets skyward-$904 billion nationally last spring-in tandem with tuition and housing costs.

Half a century ago, a four-year University of Texas degree-food and housing included-could be had for $5000 (about $37,000 in 2012 terms).  Try wrapping up a single academic year nowadays for less than 30,000 current bucks.  By the way, median American income, last time the government counted, was $50,054.  Feel like writing a check to UT-or another state school-for three-fifths of your annual income?  The problem suddenly comes into focus.

Perry's challenge to the state's public universities and colleges was: See whether you can't  devise a four-year degree program costing $10,000.  Responses to the challenge range from awarding course credits as soon as students demonstrate competency in a subject (Texas A&M-Commerce) to a combination of on-line courses, bigger class sizes, and larger scholarships (Angelo State University).

Who says, eureka, we've found the key to academic cost-cutting?  Nobody.  What we can say is that we're working on it: innovating, trying, testing.  Yes, and in a government setting!  The governor has other options at his disposal, but for now he's started the rethinking process.  And bringing in market principles is exactly the right place to start.