California has one of the most generous welfare states in the country, and Texas has one of the stingiest. And yet Texas has far less poverty.Houses are so cheap in Texas a Californian can hardly believe it. When we moved there in mid-2003 there were brand new houses for sale for less than $100k ... truly.
Indeed if you adjusted for demographics, I'd guess Texas actually has less poverty than the US as a whole, and probably even less than heavily white Massachusetts.
So what explains the Texas success in race-adjusted poverty rates? There are probably many factors, but the housing market is almost certainly the biggest difference from California.
We bought an attractive new 3 bd rm. 2 bath home with brick facade on 1.25 acres for $150k, thinking we'd stay for several years. We decided to relocate to WY instead and sold it 15 months later, at a slight loss. It was a nice place and we enjoyed our year in it.
The same house on that much land in most parts of CA would have cost $350k-$500k or more, if you could find one on more than a city lot. People sell a home on the Coast or in the Northeast and bring their equity to TX where they can often pay cash for a good home and end up with a sizable nest egg left over.
No wonder poverty is lower in TX. Most other stuff basically costs the same, but housing is much, much cheaper which, as Sumner notes, makes a big difference in one's cost of living.
