It’s a good point, but it’s also possible to ruin a prosperous place. This has occurred many times through history.
Now I think Perry’s basic thesis here is wrong. But when you understand what’s wrong with it, you’ll also see that the kind of dismissive liberal sneering Jon Chait directs at Texas is misguided. How do I know that Perry is wrong? It’s simple. If New York was a terrible place to live, work, and do business, then it would be cheap to live in New York. But New York is not cheap. It’s not Detroit. It’s not even average. It’s, in fact, hellishly expensive. If New York emulated Texas and eliminated its income tax, rich people would bid up the finite supply of New York City land at an even more furious rate—the city wouldn’t see Houston or Dallas growth rates.