For Republicans, the most exciting post-election news is that some tech companies are moving to Texas.
Tesla is going. HPE is going. Oracle is going.
Supposedly, this means California sucks and that business prefers Texas, with its lower taxes, lax environmental laws, and strict caste system.
The result will be the opposite of that. Here’s why.
First, it’s mostly loser companies that are moving.
HPE is a loser company. They supply data centers. It’s a declining market. Having them in Compaq’s old city (HP bought Compaq under Carly Fiorina) instead of where HP itself was born is no big deal. This isn’t Bill and Dave’s company anyway. It hasn’t been since it went all-in on PC manufacturing in the 1980s. HP spun out the original company as Agilent in 1999. HPE isn’t even all of HP. The company broke up in 2015. The computer and printer piece is bigger.
Oracle is also a loser company. Its market cap is about $184 billion, but Salesforce, which was built with Oracle software, is worth $200 billion, after being hammered for buying Slack.
Oracle missed the cloud. They dismissed the cloud. The cloud is built on open-source software and commodity hardware. Oracle bought out Sun and its open-source projects Java, Solaris and mySQL, then proceeded to systematically destroy them. Their data centers run proprietary software. Their prices are not competitive. Had Larry Ellison made the right moves Oracle would be worth over $1 trillion today. He didn’t. He blew it. Now he thinks a low state tax rate is going to make a difference. C’mon, man. Mainly, Ellison is a one-way guy. He’s made himself rich and done less for anyone else than anyone in Silicon Valley. He belongs in Texas although he’s personally staying in Hawaii. The company is moving there so he can make more money, as if someone with $65 billion needs any.
Tesla is an exception, but then again Elon Musk is a putz, and Tesla is a manufacturing company. The engineering has mostly been done.
In the end it doesn’t matter where companies have their offices. Corporations are incorporated in Delaware because the laws favor them there. Credit card operations are in South Dakota for the same reason. They may flock to low-tax states to screw the tax man, but government still needs taxes to do the people’s business, and government will get them.
Second. Assuming these companies are bringing workers with them, they are going to be tech workers. California, Washington, New York, and Massachusetts are blue states because tech workers vote Democratic. They do this because we want education, health care, and infrastructure. We went to college. We understand the value of cooperation. We know that colleges are the economic engines of the 21st century. College towns are blue, too. Even College Station is blue.
As tech workers filter into Texas, they’re turning its politics blue. It’s the same thing that’s been happening in Georgia. Republicans can delay it, but they still don’t have any policies that speak to what tech needs.
Tech doesn’t need tax cuts. Tech needs brains. Tech needs educated, empowered, enthusiastic brains. We don’t care what sex they are, what race they are, who they love, where they come from, or what religion they practice. We don’t care if they can move a muscle – they might be Stephen Hawking.
Tech is blue because blue policies work for tech. Resource states are red because red works for resources. In resource states it’s control of the land, and what lies under it, that matters. The mass of humanity doesn’t matter nearly as much as protection of the resource, which is assumed to be in limited supply. Red policies work where money is dear, or where resources are scarce. They work for the economics of scarcity.
Tech creates an economics of abundance. Tech is killing the oil industry. Solar and wind prices keep dropping. Texas is already a superpower in wind. With new, more efficient materials, and battery technology finally improving, its dependence even on natural gas is going to end in this decade.
The real bottom line is this. Republicans support an economics of scarcity, even if they don’t know it. Democrats support an economics of abundance, even if they don’t know it. Politics follows the golden rule. He who has the gold makes the rules. Apple is now worth more than 10 times Exxon. Tech has the gold. So, tech rules.
Everything else is details. The Trump era is a detail. It takes brains to stop a virus, and it will take cooperation to slow climate change. That means tech dominance and blue politics.
