​Check out this bonus episode of the Let People Prosper Show. My good friend, John Hendrickson of Iowans for Tax Relief Foundation, who has been a previous guest on my show, interviews me for one of his graduate courses about my role as an entrepreneur. We had a great discussion about how I got to where I am today, my faith, and the failures that have led to my success as an entrepreneur.

I hope you’ll watch it as I share my testimony and insights as a rockstar to an economist. Don’t forget to subscribe and share it.

​Texas stands as one of the most vibrant and attractive states in the United States, celebrated not only for its robust job market but also as a top destination for new residents. Its economic success and allure are largely due to the free-market model, which has fueled growth and innovation. However, even in such a thriving environment, the electricity market presents significant challenges that must be addressed to ensure continued prosperity. To keep up with its growth, Texas must refine its energy strategies, emphasizing market-driven solutions rather than increased government intervention.

Texas is rich in natural resources, capable of meeting the energy demands of its growing population if managed wisely. Among these, natural gas stands out as a particularly reliable source. In contrast to the intermittent nature of wind and solar power, natural gas provides consistent and robust energy supply, rain or shine, making it a cornerstone of Texas’ energy infrastructure.

Despite these natural advantages, there has been a worrying shift towards greater government involvement in the energy sector, potentially undermining the very free-market principles that have driven Texas’ growth. This trend was exemplified by the recent legislative decision to pass SB 2627, establishing the Texas Energy Fund. While intended to support the state’s energy infrastructure, this initiative opens the door for problematic state interventions in the market.

Approved by voters last November, the fund is slated to allocate $10 billion, with a substantial portion earmarked for state-controlled power projects and infrastructure developments outside the purview of the Energy Reliability Council of Texas (ERCOT). Such strategies risk taxpayer dollars and discourage the private sector investment crucial for spurring innovation and efficiency in the energy sector.

Further compounding the issue is the engagement of large investment firms like BlackRock, which has expressed interest in exploiting the Texas Energy Fund. Historically detached from Texas’ core energy industries, these firms stand to benefit from state-directed initiatives at taxpayer expense. This involvement will centralize power, stifle competition, and suppress the innovation that is vital for a healthy market economy.

Instead of continuing down this path, Texas needs a light-touch regulatory framework that promotes competition and fosters innovation through market forces. State policies should remove obstacles for private investment in energy production and distribution, ensuring a competitive market that drives down costs, improves service quality, and encourages technological advancements.

The limitations of unreliable energy sources have been made starkly apparent each time Texans receive a conservation notice from ERCOT, with more likely coming this summer. A free-market approach, which minimizes government intervention and allows energy prices to reflect supply and demand, offers the best solution for managing Texas' energy resources efficiently.

This strategy is about more than just maintaining an efficient energy grid; it’s about preserving the entrepreneurial spirit that defines Texas. By reducing government overreach and enhancing market dynamics, Texas can ensure that its energy sector remains as dynamic and resilient as its economy.

Looking forward, Texas policymakers face a clear choice. They can embrace the principles of free-market capitalism and minimal government intervention across all sectors, not just energy. This path will secure Texas' leadership in economic growth and innovation, ensuring a reliable and affordable energy supply for future generations, which ought to include nuclear energy.

By championing policies that reduce government involvement and promote market functionality, Texas can strengthen its infrastructure to support its growing population and sustain its status as a beacon of prosperity and freedom. Emphasizing market-driven solutions will enable Texas to meet the challenges of today and tomorrow, ensuring that the state remains a fantastic place to live, work, and raise a family.

Texas has always been a leader, not a follower. By adhering to the principles that have shaped its past successes, Texas can ensure a bright and prosperous future, powered by innovation, competition, and the indomitable Texan spirit.

​Join me in this insightful episode of Let People Prosper as I dive into the economic implications of government regulations with Dr. James Broughel, a senior fellow at the Competitive Enterprise Institute.

​We explore:

- Which regulations pose the greatest economic burdens?
- How crucial are cost-benefit analyses in regulatory practices?
- Can some regulatory adjustments be "free lunches"?

Don’t forget to like, subscribe, and share this episode to help spread valuable information. For more insights and bi-weekly episodes, subscribe to my newsletter at vanceginn.substack.com. Visit vanceginn.com for additional resources.

​Join me in this insightful episode of Let People Prosper as I dive into the economic implications of government regulations with Dr. James Broughel, a senior fellow at the Competitive Enterprise Institute. 

We explore:

- Which regulations pose the greatest economic burdens?
- How crucial are cost-benefit analyses in regulatory practices?
- Can some regulatory adjustments be "free lunches"?

Don’t forget to like, subscribe, and share this episode to help spread valuable information. For more insights and bi-weekly episodes, subscribe to my newsletter at vanceginn.substack.com. Visit vanceginn.com for additional resources.

Originally published at The Courier.

By John Hendrickson and Vance Ginn, Ph.D.

Iowa Governor Kim Reynolds and the Republican-led Legislature have emphasized conservative budgeting as a central priority. Such prudence in budgeting is the cornerstone of fiscal conservatism, and the recent passage of the FY 2025 budget in Iowa showcases a commitment to fiscal restraint, albeit less stringent than in previous sessions. The newly approved $8.9 billion FY 2025 General Fund budget marks a 4.7 percent increase from the previous fiscal year's $8.5 billion, demonstrating moderate fiscal growth.

Historically, spending has been recommended to align with the combined rates of population growth and inflation. Based on this formula, the FY 2024 budget of $8.5 billion should ideally have capped the FY 2025 spending at $8.8 billion. Adhering to such metrics ensures that the budget reflects the average taxpayer's ability to fund it, a fundamental principle that should guide all budgetary decisions. This year, however, the legislature has ventured slightly beyond this benchmark, underscoring the careful balance between fiscal responsibility and the needs of a growing state.

To provide substantial relief to individual taxpayers, the legislature has implemented a significant income tax cut, reducing the flat tax rate to 3.8 percent. This measure is projected to save each taxpayer over $1 billion annually. The tax relief directly benefits Iowans, putting more money back into their pockets and supporting more economic growth.

Despite concerns from critics who argue that such fiscal strategies could undermine public services, the FY 2025 budget demonstrates that the government is not retrenching but rather growing at a deliberate pace.

Education remains a top priority, accounting for 56 percent of the budget. When combined with the allocations to the Department of Human Health Services (DHHS), these two areas consume a significant 81 percent of the General Fund. While this concentration of funds reflects the importance placed on these sectors, it also highlights the challenges of allocating resources to other critical areas, such as public safety and the judicial system, which have only seen modest increases.

The practice of conservative budgeting is further evidenced by the state's adherence to its legal spending cap, which allows up to 99 percent of projected revenue to be used. In contrast, the FY 2025 budget only commits 92 percent of these projections, reinforcing Iowa's fiscal discipline. This cautious approach is proving effective, as evidenced by the substantial budget surpluses recorded in recent years, including a $1.8 billion surplus in FY 2023, with similar surpluses anticipated for FY 2024 and FY 2025.

Looking ahead, legislators must remain vigilant to ensure that conservative budgeting principles continue to guide fiscal policy. State Senator Jason Schultz rightly points out the interdependence of tax policy and spending, “Both Republicans and Democrats need to realize that tax policy is affected by spending. And when you start seeing spending creeping up for annual, year after year, new good ideas, you can’t have good tax policy.”

Strengthening Iowa's 99 percent spending limitation would provide a robust mechanism to curb future expenditure desires. This could be done by changing the law and enshrining it in the Constitution to bind spending increases to no more than the rate of population growth plus inflation.

Iowa’s fiscal approach starkly contrasts the situations unfolding in neighboring states like Minnesota and Illinois or others such as New York and California. Higher spending and taxes in these progressive states contribute to economic challenges and drive more people away.

The message is clear: unsustainable increases in spending can lead to severe consequences. Iowa's success in maintaining fiscal discipline through conservative budgeting and responsible tax policies is a testament to the effectiveness of this approach.

Iowa’s unwavering commitment to conservative budgeting and responsible tax policies is the cornerstone of its fiscal strategy, ensuring the state remains a model of stability and prosperity. By striking a balance between providing essential services and fostering economic growth, Iowa sets a commendable example of how sustainable fiscal policies can safeguard a state’s financial health and support the well-being of its citizens.

John Hendrickson serves as policy director of Iowans for Tax Relief Foundation, and Vance Ginn, Ph.D., is a contributing scholar at ITR Foundation and former chief economist at the Office of Management and Budget, 2019-20.

​In the 10-minute “This Week’s Economy” episode, I discuss the following (and more!):

- Why did the Fed pause again?
- How do investors help the housing market?
- How are states’ economies doing? 

Please share, rate, and review this episode. Check out my Substack newsletter with show notes and more at vanceginn.substack.com or vanceginn.com.

​Watch this interview that I did with Dr. Deane Waldman on the costs and benefits of mandating price transparency by hospitals and whether it will result in anything productive at the Third National Health Care Transparency & No Surprise Act Summit, This interview was aired at https://www.hctransparencysummit.com/.

The document below is the syllabus for a course that I teach on free-market economics and the importance of institutions. Please provide feedback. Thanks!

“Parents know best for their kids. Not politicians, bureaucrats, CEOs, or anyone else. Sure, many parenting don’t make the ‘correct’ choices, as I make many mistakes, but government one-size-fits-none policies will make the situation much worse.”
—Vance Ginn, former Chief Economist for the White House Office of Management & Budget under President Donald Trump.