Monday, January 23, 2012

Top rankings mania, United HQ, jobs, zoning, Texans, and more

The smaller misc items have been piling up faster than usual lately...
"Throughout the economic crisis, Houston has been the buttoned-down older brother to Austin's hippie slacker. 
While college-boy Austin coasts by on education and arts, Houston shrugs off the cool kids, goes to work every day with its buddies in the energy industry and does what it can to keep unemployment below 8%. Unlike Austin, though, Houston doesn't have to drop its home prices to draw new blood."
"Zoning became a game for poker sharks."
  • The Chronicle editorial board picked up on the WSJ middle-class jobs story I covered last month.  A good strength of Houston.
  • I came across this quote about the United-Continental merger and choice of HQ in a Fortune article.  Based on this and what I've heard about the radical decline in Continental service since the merger, I think I can safely say that they royally screwed up this merger picking Chicago for the HQ over Houston.  It not only raised costs, but helped the much lower regarded United culture win out.
"To be fair, there are some initial benefits to combining operations. Merging headquarters and slashing management costs does help the surviving airline, although it can be limited. For example, United has had to hike the pay of Continental employees by 20% to 30% to entice them to move up to Chicago from Houston, a person close to the company told Fortune. The bizarre reason to remain headquartered in such an expensive city, even with tax breaks, shows that airline mergers aren't always rational."
Finally, I'm a couple weeks too late in sharing this, but it's still pretty cool.  In retrospect, the lyrics at the 3:16 point were poorly chosen.  Oh well.  Next season is looking good.  Go Texans!

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Monday, January 16, 2012

Is our lack of zoning a myth?

Slate has a blog post claiming that zoning-free Houston is a myth (hat tip to John).
"Whenever I talk about anti-density land use restrictions, someone inevitably brings up Houston, where people have heard there are no zoning rules. If overregulation causes low density, people ask, then how come Houston is so sprawling? There are a number of reasons this line of questioning is a mistake, but the most fundamental one is that people misunderstand what "no zoning" means in the Houston context. If land use in Houston were genuinely unregulated, then this Nancy Sarnoff article about possible revisions to Houston land use rules would make no sense. In fact, the city features extensive regulation of minimum lot size and maximum parking requirements just like every other major American city. The specific proposal here, meanwhile, is a mixed bag. 
On the one hand, you'd be allowed to build townhomes and other "urban-style housing" outside of Loop 610. That's good. But on the flipside they're also talking about "requiring additional parking in higher density developments." Parking requirements are pernicious in almost all contexts, but especially so when you have a major effort under way to encourage more residential density. The point isn't that Houston developers should build parking. It's a very auto-oriented city, and if I were building homes I expected to sell to people I'd want to include parking. But there's no reason to require more parking than the market demands."
Well, unless you're reacting to the free-rider/tragedy-of-the-commons problem of street parking.

He's basically arguing that, while we don't have zoning, we do have regulation, which is certainly true.  But that doesn't mean our lack of zoning is a myth.  I think he was looking for a provocative headline.  But what I most enjoyed were some of the comments, where quite a debate developed.  Some favorite excerpts:
Houston still does not have Zoning in the concept that other cities have zoning. While there many development regulations, there is no land use regulations. There are not regulations that restrict what can be built on a piece of land and what that land can be used for.

There is a caveat though, liquor stores and strip clubs can't be built by schools and platted neighborhoods can have their own internal land use controls.

The internal land use controls are in the form of Deed Restrictions. Active neighborhoods keep these restrictions in place and maintain their land use. Neighborhoods that neglect their Deed Restrictions see massive change. It's a very effective way to develop a city and it's more real and natural. Central planning destroys cities by forcing them to develop unnaturally.

The inner loop of the Houston is growing in density at a faster pace without some urban planning zoning it to be denser.
-----------------------------------
The most interesting thing about Houston is, outside deed restricted neighborhoods, there are few if any restrictions on the height of Residential or Commercial property.

As a result while we have a decently developed downtown, we have about half a dozen mini downtowns scattered across the city, not to mention the Texas Medical Center which is a small city in its own right.

This also allows condo developers and high rise apartment owners to offer buildings with great views.

It also allows neighborhoods with two story houses near downtown and other premium locations to be affordable and safe.

It is a huge headache for transit managers to deal with multiple job centers, but it is great for traffic because you have tons of rush hour traffic that is multi-directional meaning you do not see freeways as clogged as other cities.
Of course, these points are probably not exactly news to the readers of this blog, but I still thought they were good, concise articulations of how Houston works and the advantages this gives us.  One not mentioned: how it helps us be such an amazing restaurant town - something repeated to me today by a friend visiting from out-of-town for the marathon.

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Monday, January 09, 2012

Homeless solution, GRB growth, #1 mfg, Metro and rail

The smaller misc items stacked up over the holidays:
"Our top ranked area, Houston, is one of only four regions that enjoyed net job growth in manufacturing in the past 10 years. This year its heavy manufacturing sector expanded by almost 5%. Houston’s industrial growth is no fluke; over the past year its overall job growth has been about the best among  all the nation’s major metros. 
Houston’s industrial success owes much to the city’s massive port and booming energy sector, says Bill Gilmer, senior economist at the Federal Reserve office of Dallas. “Houston is about energy — it’s about fabricated metals and machinery,” he says. “It’s oil service supply and petrochemicals. It’s all paced by a high price of oil and new technology that makes it more accessible.” 
This shift towards domestic energy augurs well for a huge and economically beneficial  shift in America’s  longer term economic prospects, he points out. Cheap natural gas, for example, makes petrochemical production in America more competitive than anyone could have imagined a decade ago. Linkages with Mexico in terms of energy as well as autos has made Texas — which is also home to No. 4 ranked San Antonio and No. 15 ranked Dallas — the nation’s primary export super-power, with current shipment 15% to 20% above pre-crisis levels."
Finally, Reason dissects LA's light rail system in this amusing video interviewing passengers on a ride from LAX to Burbank, while pointing out the huge per-rider taxpayer subsidies involved, how it has led to substantial under-investment in bus service, and the hardships that has caused for transit riders.  And unfortunately Metro seems to be on a similar path here, with ongoing cuts to bus service instead of the huge increase promised in the 2001 referendum.  Sadly, the poor, elderly, and transit-dependent suffer while we pat ourselves on the back as progressives for building light rail. Hat tip to Barry.

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Monday, January 02, 2012

2011 Highlights

It's time for the Fall 4Q11 quarterly highlights post, which also sums up all of 2011. These posts have been chosen with a particular focus on significant ideas I'd like to see kept alive for discussion and action, and they're mainly targeted at new readers who want to get caught up with a quick overview of the Houston Strategies landscape. I also like to track what I think of as "reference posts" that sum up a particular topic or argument; and, last but not least, they've also been invaluable for me to track down some of my best thinking for meetings or when requested by others (as is the ever-helpful Google search).  They're not quite as useful as they were when I was still doing multiple posts each week, but still have some value (at least for me).

Don't forget we offer an email option for the roughly once/week posts - see the Google Groups subscription signup box in the right sidebar. An RSS feed link is also available in the right sidebar. As always, thanks for your readership, and may you have a wonderful 2012.

December
November
October
  • A remedial lesson in urban form and economics (part 1, part 2)
And from Summer 3Q11:

September
August
July
And from Spring 2Q11:

June
May
April
And from Winter 1Q11:


March

February

January

And don't forget the highlights from the first few years. For what it's worth, I think the best ideas are found there, often in the first year (I had a lot "stored up" before I started blogging) and most definitely in the 5th birthday retrospective.

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Monday, December 19, 2011

Houston a "brain hub" creating middle-class jobs?

The Wall Street Journal recently profiled Austin's power to create middle class jobs, something the rest of the nation is struggling with.  But not Houston.  If you check out their graph, you'll note that Houston and Austin are neck-and-neck in middle-skill job growth since 2001 at ~25%, and well ahead of the rest of the pack, including Dallas (surprisingly).  Let's look at the key excerpts first, then discuss if Houston is following Austin's model:
AUSTIN, Texas—As the nation grapples with stubbornly high unemployment, Texas's political and high-tech capital shows one way to create good jobs for people who didn't go to college: Attract highly skilled entrepreneurs, and watch the companies they start hire lower-skilled workers
The Texas state Capitol in Austin, a city that in the past decade has added 50,000 'middle-skill' positions that pay roughly $38,000 a year. 
Praxis Strategy Group, an economic-development consultancy, estimates Austin added 50,000 "middle-skill" positions in the past decade. These are jobs that require a two-year associate's degree or the equivalent work experience, and pay a median wage of $17.30 an hour, or $38,000 a year. That pace of growth is roughly four times faster than the nation's as a whole, three times that of New York and Portland, Ore., and twice that of Phoenix.
Austin's success in creating middle-class jobs runs against the grain of national trends. As America's shift from manufacturing to the service sector has accelerated, economists have noted a hollowing out of such jobs.
...
One consequence of the economy's shift away from production toward brain work is that companies are constantly seeking new ways to break down high-value intellectual tasks into smaller, cheaper bits. Much the same way that assembly lines created millions of new jobs by reducing mass production to a sum of tasks, employers in Austin and elsewhere are constantly breaking down higher-skill jobs to "create new middle-skill, middle-income specialties," according to a recent report by the McKinsey Global Institute.
...
Enrico Moretti, an economist at the University of California, Berkeley, notes that highly educated cities see faster wage growth for less-educated citizens as well as the high fliers. One reason is that that many lower-level employees use the most productive technologies and act as complements to more-expensive and highly-educated workers, making it much easier for companies to raise their wages faster than overall inflation
Another force, Mr. Moretti notes, is called "human capital spillovers," a fancy way of saying that many "middle skill" workers begin to acquire skills that are much more valuable than their overall education level might suggest.
The WSJ has a companion blog post on "brain-hub cities", with the following distinction between two types of them:
William Frey, a demographer at the Brookings Institution in Washington, notes that there are two types of high-educated metro. The first are old stalwarts like Washington, San Jose — the heart of the Silicon Valley — and Boston. Those cities are already highly educated — each has a greater than 35% share of college degree or higher workers, versus 28.2% nationally — yet have still seen big gains in their share of college educated population. That’s not so much because young and educated workers are moving there, although many are. What’s driving those gains is the fact that many lesser-educated workers are leaving — either by dying or moving to less expensive cities
The second type of educated city are places like Raleigh and Austin that have had fast growing populations but, thanks in part to their relative affordability, have seen a more diverse mix of educated and less-educated workers moving there. Because they’re adding all sorts of people, those places are middle of the pack when it comes to their share gain of college educated workers. But, when measured in raw numbers of college-educated people moving there, they were the nation’s number one and two most popular destinations.
Now, you don't often hear of Houston as a "brain hub", but I'd argue we fall pretty clearly into the second camp there.  The reason we don't get the same media hype as a place like Austin is that our brain hub is hidden inside of a much larger overall metro economy driven by things like the port and manufacturing (both of which also drive a lot of middle class jobs).  Our brain hub is also not concentrated in the media's darling industry, technology, but broken up across energy, medical, and NASA.  Both factors muddle up Houston's story (not to mention the energy boom), thus the Journal's preference for Austin's simpler story even though our stats are almost tied (tied on a percentage growth basis, which means in reality Houston has created many more absolute numbers of middle class jobs, probably close to triple Austin's).

The question is, do we have a similar dynamic to Austin as described in my bold highlights in the main story?  Do our brain jobs in energy and medical drive the same type of middle-class job growth in the ways they describe?  I suspect yes, but don't have a lot of experience in either industry, so I'll throw it to my readers.  Thoughts welcome in the comments.

Update: The Houston Chronicle picks up the story with an editorial: "Houston's well-positioned to create good jobs"

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Monday, December 12, 2011

290 rail, IAH A380, city GDP, H-town Hackerspace, K12's future, and more

OK, the smaller miscellaneous items just keep stacking up:
  • Check out TX/RX Labs, Houston's Hackerspace.  I just think it's awesome that Houston has something like this.  Very cool and expanding fast.
  • Peter Wang writes about a nightmare traffic experience at CityCentre for a holiday party, noting that New Urbanist/"Livable Center" developments in Houston will still need to accommodate large volumes of cars at peak periods since we just don't move that many people by foot, bike, or transit (like classic "old urbanist" cities would).
  • IAH is getting Airbus A380 service, and is just the sixth U.S. city to do so!  (on Lufthansa from their Frankfurt hub) I remember meeting an airport official a few years back that was skeptical about IAH getting A380 service (or, more importantly, needing to pay big $ to upgrade the airport to accommodate it), but I think the global energy boom is changing the equation.
  • Don't hold your breath on 290 commuter rail says Bill King after a thorough analysis.  Here are the scary numbers:
"But even taking the report's ridership projections at face value, the real stumbling block to this project is the cost. Without the link to downtown, the start-up capital costs are estimated to be $290 million, with an annual operating cost of more than $6 million. This equals a capital cost of $96,000 per rider and an annual operating cost of more than $2,000 per rider, a level that is clearly not viable
If one assumes that somehow the inevitable neighborhood opposition to an extension through the Heights could be overcome, and a link to downtown completed, the report projects the total capital costs would be $544 million with annual operating costs of $21 million. This would still be about $50,000 in capital costs and more than $2,000 in annual operating costs per rider."
"Metro service today has 5-minute intervals between buses and goes nonstop to downtown. The proposed commuter rail line would have 20-minute intervals and stop at 10 stations, then require a transfer to a bus to get downtown."
  • A WSJ profile of the world's most fabulous airport in Singapore, including rooftop pool, butterfly garden, and tons of other amenities.  IAH, take notes if you want to be the hub of choice for international travelers...
  • Houston is the country's #5 metro in terms of GDP at $379B, behind NYC, LA, Chicago, and DC, but ahead of SF, Dallas, Boston, Philly and Atlanta.  That makes *just our city* the 31st-largest economy in the world and larger than Austria, Argentina, or South Africa.
  • Forbes “Best State for Business” pegs Texas at No. 6, but No. 1 in the economic climate category.
  • If you want to understand the high-tech future of K-12 education, read this book.  Short, quick, easy read, but one that will amaze you with the potential revolution.  It even has a book jacket endorsement from HISD superintendent Terry Grier (but don't let that stop you if you're not a fan of his).  I plan on doing a future post with a more detailed book review, but wanted to get it out there now in case anybody's looking for a little holiday reading material for when you're traveling or stuck at the in-laws'...  ;-)

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Wednesday, December 07, 2011

WSJ says really nice things about Texas

Wall Street Journal columnist Daniel Henninger had some very nice things to say about Texas in a recent column about Rick Perry.  For my excerpts, I'm going to skip the Perry stuff and just focus on the Texas accolades.  It'll make you proud.
Rick Perry says Texas is the most successful state in America. He's right. Texan economic output exceeds Mexico's and Australia's and rivals India's. ...
(that last stat blows me away considering that we have 25 million people vs. 1,200 million (1.2 billion) people in India!
Texas, unlike California, isn't America's most beautiful state. Through October this year, parts of Texas had 90 days of 100+ temperatures. Yet companies and people keep moving into the high heat of Texas. ... 
In 1990, one of the world's biggest companies, Exxon Mobil, left New York City for Dallas. Exxon's former CEO, Lee Raymond, says the move in part was indeed about costs and New York State's notoriously overbearing tax authority. But it was also about working amid a culture of competence. "It's just the attitude in Texas of getting things done and doing them well," he says. 
Mr. Raymond remarks that the economic policies that in time trapped the Northeast and Rust Belt in spirals of decline never touched Texas. But this is about something beyond low taxes and no unions: "In Texas the people tend to be farmers or individual businessmen, and they have this attitude: We have to make do with what we have and work together to get things done and survive. It's can-do. That attitude permeates everything there."
...
Ed Trevis, a smaller fish, is also happy. A California-educated Brazilian immigrant and tech entrepreneur in Silicon Valley for 25 years, Mr. Trevis moved Corvalent Corp. to Austin for similar reasons. He had to hire a firm just to do California's compliance. "In California," he says, "you are always doing something wrong." 
"What I found in Texas is that from the standpoint of running a business, cost of living, education, the labor pool, quality of life, it just blew other states out of the water." I heard this constantly—people enjoy being in business in Texas.
...
Texas' pro-business bias goes back about 175 years—and never died. "It's just that they believe in the whole Horatio Alger myth down here," said Mr. Booth. "It's hard to understand if you haven't lived here." 
And so Perry's Paradox: Rick Perry is a success because he nominally presides over an American tiger state, a genuine free-market economy that doesn't much need—or want—his tender loving care. ... 
This much is obvious: Texas, not California, better be the American future...
Well, at least economically.  Let's hope California's weather - and not Texas' - is America's future, most especially in this horribly hot-and-dry drought year...

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Monday, November 28, 2011

A targeted tourism strategy for Houston

I recently got engaged on an interesting discussion thread on HAIF about making Houston more of a tourism magnet, an area where we are sadly lacking compared to other global cities of our stature.  In that thread I reposted my July post on attracting national and international tourists to Houston, where I talked about converting the Astrodome and empty land nearby into the world's largest engineering and technology museum.  But the more interesting thing to come out of the HAIF conversation was a bigger picture tourism strategy for Houston.  It starts with this list from the post of areas where we really can't compete:
  • Out family-fun Orlando?
  • Out weather California?
  • Out beach Florida or Hawaii?
  • Out culture New York?
  • Out museum DC or New York?
  • Out gamble/adult-fun Las Vegas? (or South Beach?)
  • Out ski Denver or Salt Lake City?
  • Out history New Orleans, Boston, Savannah or Charleston? (or even San Antonio)
See what I mean? People choose vacation locations for specific reasons, and the winners are pretty damn dominant. We're stuck as a local/regional "big city" tourism destination like Chicago is for the midwest and Atlanta is for the southeast, with our share of great museums, restaurants, shopping, and a few attractions - but not enough to pull people from across the country - much less the world - to vacation here.
And here's my new insight that came out of the discussion:

From a marketing analysis, there is an unfilled niche, and here's my articulation of it: parents plan family trips, and they often want to educate their kids as well as have fun. There are plenty of opportunities to do this with history - Colonial Williamsburg, Boston, New Orleans, San Antonio and the Alamo, etc. - not to mention Europe. DC is where you learn about our great country's history and political system. The national parks for learning about nature and the environment. San Diego for every type of animal in the mega-zoo (and SeaWorld for aquatic animals).

But there's bit of a hole in the tourism market when it comes to teaching kids about and inspiring them into STEM careers (Science, Technology, Engineering, Math). On a national level there's the Air and Space Museum in DC and a couple of NASA sites (inc. Houston JSC), but it's pretty limited. On a local level it's pretty small science and children's museums. We could aspire to be one of those "must-do" vacations for all families that want to broadly educate their kids. "A DC/Smithsonian of STEM" might be a way to think of it. Maybe that's one mega-museum, or a collection of medium-sized ones. The Astrodome is a huge opportunity, as is the giant empty field to the south of it and the easy rail connection to our Museum District. And we already have a starting pull with Space Center Houston. Build on that, and we can create a differentiated niche from other tourist destinations.

By creating a very future-oriented, big challenge-focused, STEM-based tech/engi/science museum complex (including energy) as a compliment to NASA, we become one of those destinations families will want to visit for the benefit of their kids. I'm not saying they won't also have some fun when they get here (Kemah, Galveston, shopping, eating, etc.), but the core reason they will add it to their vacation plans will be to inspire their kids into STEM fields (Science, Technology, Engineering, Math) - just like I'm sure plenty of DC trips have inspired kids into public service careers.

The short description would be like the National Air and Space museum (the 2nd most popular museum in the world after Paris' Louvre), but covering a broader range of STEM subject areas and giving not just history, but articulate the big challenges facing those fields going forward. The goal is to not just look backward, but inspire kids to study hard so they can contribute to working on the big problems of the future in their careers. The original vision of Epcot might be another example. Include lots of interactivity and summer camps, with school field trip groups on multi-day visits.  It should address the Grand Challenges of Engineering, with maybe a wing for each.

I think most of the museum would be the history of engineering and technology, maybe grouped into themes like "transportation", "computing", "health/medicine" (link to the world's largest medical center, anyone?), "energy", etc. but then shifting at the end of their timelines to broad, long-term challenges. The goal is for the kid to get swept up in the great people and innovations of the past and then get them excited about being contributors to future progress.

I wonder if a better name might be "The Museum of Progress", showing how human civilization has advanced with science, engineering, and technology and the great challenges we face going forward.

Definitely take some time to browse the thread - there are some good ideas and graphics from others in there.  And I'd love to hear your thoughts on the strategy, the specific museum concept, and potential names in the comments.  And if you're one of Houston's political or financial power-players interested in supporting something like this, please drop me an email (tgattis (at) pdq.net).

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Monday, November 21, 2011

Tops for global connections, shale gas, new map, regs vs. density, and more

Since it's a short week where people usually don't have a whole lot going on in the office, I thought it'd make sense to do a misc items post this week since people might have more time to follow the links.  So here they are:
From the Houston Digital Ambassador emails:
Finally, to end on a lighter note, here are my favorites from the Houston Press' "50 Reasons Texas is the Best State in America"
42. No state income tax, suckaz. 
39. "Failure is not an option." Yeah, it was never actually said by Gene Kranz, but it summed up generations of work at NASA that hopefully will not end with the shuttle era. 
37. Tex-Mex. Comfort food, hangover cure, drunken latenight scarfing: It has many purposes, all of them delicious. 
34. When you say you're from Texas, no one in the world needs to ask where that is. 
26. If there's an ethnic food that's not available in Houston, it involves a very, very small ethnicity. 
14. Few states have legislatures that meet less often than Texas's, and we like to keep it that way.
Have a wonderful Thanksgiving and I'll see ya next week.

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Friday, November 11, 2011

My TEDx Houston talk, mostly about Houston

Sorry for the post delay this week - got back midweek from California and ran right into a giant pile of work.  Back in June I had the opportunity to speak at TEDx Houston on the UH campus.  It was a fantastic (and yet nerve-wracking) experience I really enjoyed.  Well, the professionally edited video of my talk is finally available: "What is Social Systems Architecture and why does it matter?"  It covers kind of a wide range of topics over 20 minutes (the first 14 mins are all Houston):
  • The Opportunity Urbanism philosophy of cities and how Houston is an exemplar of that model
  • Branding Houston
  • A transportation/transit solution for Houston and other decentralized cities
  • Organization 2.0 and the Bossless Organization model
  • Reforming K-12 education with empowerment
And yes, if you're wondering, I broke all the TED talk rules by packing way too much into my 20 minutes (and apologies in advance for the frequent throat clearing; lesson learned: no ice water before speaking).  But I got some very positive feedback from the audience, so at least some people appreciated the difference from the usual TED talk model.  The video does a decent job of capturing the slides too (use the bottom right-side arrows to make it full screen), but you can also download a pdf of the slides here.  I know 20 minutes is a lot of commitment in the web/blog world, but it really does capture a lot of the key themes from this blog, so if you're a loyal reader, it's probably worth your time (Facebook will still be there for you tomorrow, right? ;-)

Enjoy.  As always, thoughts and feedback are welcome in the comments.

UPDATE: The Urbanophile comments and summarizes his key takeaways.

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Tuesday, November 01, 2011

Montrose LRT, 290 rail vs. bus, #1 income growth, #1 diversity, housing, IT

Time to catch up on the smaller misc items:
"Metro service today has 5-minute intervals between buses and goes nonstop to downtown. The proposed commuter rail line would have 20-minute intervals and stop at 10 stations, then require a transfer to a bus to get downtown."
Finally we'll end with a little humor: how many things can you find wrong with this picture?  That is some mighty impressive photoshopping, although I can't figure out *why* somebody went to all the trouble?...

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Tuesday, October 25, 2011

Houston vs. Detroit government philosophies

The National Review recently published a great essay on the Detroit vs. Houston development models since WW2 titled "Houston, We Have a Solution" (big hat tip to Brian).  Detroit was so far ahead of us - how did things switch so powerfully over the last few decades?  The whole article is definitely worth reading, but let's dive into the key excerpts: (highlights mine)
---------------------------------

Houston had suffered race riots, too, during World War I, but fortune would smile on it for most of the 20th century. And when oil prices collapsed in the mid-1980s, sending the city into a depression, it bounced back as if suspended from a bungee cord — even though the oil bust lasted nearly two decades. What Houston did for itself is not merely a model for any city facing the danger of sudden economic decline: The policies that Houston and Texas have followed are proof of concept for the conservative vision of government, which is, essentially, to keep the government off the people’s backs and let a free society find its own way to prosperity.

Detroit, conversely, is proof of concept for the liberal vision of government, which seeks to solve every problem through government, to shape economic development through government, to redress grievances through government, to attain social justice through government, and, finally, to insinuate government into every aspect of our lives. The problems Detroit faced in the latter half of the 20th century would have been enormously challenging no matter what policies it embraced. But it embraced the worst ones and so plunged recklessly down the slope of decline.

Each city has offered a nearly pure exposition of a particular philosophy of government and a vivid demonstration of the results. In the degree of collusion between business and government, in the power of labor unions, in the method of economic development, in the burden of taxation and regulation, in the tolerance for diversity — in all these ways and more, the two cities stand as diametric opposites in the choices a society can make.
...
Between 1900 and 1930, Detroit was the fastest-growing city in the world.
...
Texas likes to brag that it is “business friendly,” but it would be more accurate to say that it is, by both philosophy and force of circumstances, “competition friendly.”
...
Texas has prospered from the fact that it is a right-to-work state.
...
The Texas Medical Center in Houston is the world’s largest, employing nearly 100,000 people and receiving nearly 6 million patients per year.
...
Tolerance of cultural diversity has become a hallmark of Houston’s ascent, despite the state’s checkered history of race relations. Texans take individual freedom and individual responsibility very seriously, so meritocracy comes naturally to them. In the words of George Strake, one of Houston’s most venerated oilmen, “Everyone’s welcome here, so long as you’re willing to pull the wagon and not just sit in it.” That is perhaps why anti-immigrant feeling is not nearly as pronounced in Texas as it is in other parts of the Southwest. Like Detroit, Houston is minority white, but more diverse: Blacks make up 25 percent of the population, Hispanics 37 percent, and Asians (chiefly Vietnamese and Chinese) more than 5 percent.

Texas has managed to preserve something very essential about America, namely the frontier mentality, what the great Texas historian T. R. Fehrenbach described as the “cult of courage.” Or, in the words of Mr. Strake, “Give me wide open spaces. Let me enjoy the good times, and don’t feel sorry for me in bad times.” Naturally, this leads to a certain vision of government: Defend our shores, deliver the mail, and get the hell out of the way.
...
...keeping government off people’s backs and letting the free market innovate its way out of recession. The Lone Star State is now the industrial engine of the American economy, singlehandedly responsible for half of the country’s job growth in recent years.

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