Texas anti-ESG laws costing state more than $700M, study says
A pair of anti-ESG laws Texas passed in 2021 are costing the state hundreds of millions in lost economic activity and more than 3,000 full-time jobs, a new study found.
The findings of the research add to those in an academic paper last year that showed significant increases in borrowing costs for the Lone Star State as a result of the legislation, which blocks its business with companies perceived to be boycotting the oil or firearms industries.
While the new report is not novel in finding that the state’s laws appear to have backfired, the source behind the paper is revealing. It was published by the Texas Association of Business, a chamber of commerce that among many members includes major oil companies like ExxonMobil, Chevron, and ConocoPhillips.
The high-level findings of the report are that the laws cost Texas about $669 million in lost economic activity during fiscal year 2022-2023, along with $181 million in decreased annual earnings, 3,034 fewer full-time jobs and more than $37 million in tax revenues.
“These findings illustrate that when government attempts to mandate values, no matter what kind, to businesses, the market loses,” the study’s author, economist Jon Hockenyos, said in an announcement of the results. The Texas Association of Business commissioned Austin-based consulting firm TXP to publish the report.
Although Hockenyos credits Texas’ tax policies with building a “pro-business climate” that has benefited its economy over a number of years, “there has been a tightening of the competitive bond market in Texas due to enforcement actions pursuant to Texas’ 2021 Fair Access law, which could undermine this significant progress,” he wrote. “Recently, two major banks, Citi and Barclays were dropped from
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