Texans know that economic freedom is the foundation of prosperity. Yet, despite Republican control of the Governor’s Office and Legislature since 2003, state and local government spending has grown far too much, burdening taxpayers and stifling even greater economic growth. If Texas is to remain a model of opportunity, we must rein in spending, reduce taxes, and ensure more money stays in the pockets of hardworking Texans. It’s time to adopt a stronger fiscal framework prioritizing taxpayers over government growth.
Spending is Out of Control
The numbers don’t lie. Figure 1 illustrates how Texas state and local spending as a share of GDP has skyrocketed from 12% in 1970 to 16.5% in 2024, for a 37.5% increase in an economic burden on the productive private sector.
Figure 1. Increasing Burden of Texas Government Spending on the Economy
Figure 2 shows how total appropriations (state plus federal funds) and state appropriations have far outpaced population growth and inflation since 1996.
Figure 2. Texas Government Spending Outpaces Population Growth Plus Inflation
Even with a Republican trifecta in place for two decades, spending has continued to climb, driven by state and local governments.
Congressman Chip Roy (R-TX) recently posted on X, “Under GOP control, government in Texas has grown…The gap has widened since GOP trifecta control in 2003.”
State Representative Brian Harrison (R-Midlothian) doubled down on this on X, stating, “Texas government was smaller when DEMOCRATS were in charge. We’ve been coasting on our conservative reputation…Must make Texas the limited government, low tax, low regulation, bastion of LIBERTY everyone thinks we are!”
This excessive spending isn’t just an abstract number—it comes directly from taxpayers’ wallets. Higher spending requires higher taxes, whether through explicit rate hikes or hidden costs like rising property tax bills.
Every dollar the government spends is a dollar families could have used to invest, save, or grow their businesses.
The Frozen Texas Budget: A Sensible First Step
The Frozen Texas Budget is a simple, effective way to get spending under control. It calls for freezing state spending at current levels and using surplus dollars to buy down property taxes. This approach aligns with the values of fiscal conservatism and allows Texans to keep more of their hard-earned money. Figure 3 provides the 2026-27 budget limits that should be passed in the 2025 Legislative Session in Texas.
Figure 3. Frozen Texas Budget for 2026-27 Budget
Under a frozen budget, every additional dollar collected from economic growth would go toward reducing the burden on taxpayers rather than growing the government. This creates a powerful incentive for legislators to prioritize efficiency, cut waste, and focus on core functions.
Sustainable Spending: A Maximum, Not a Goal
While the Sustainable Budget Project, developed by me for Americans for Tax Reform, proposes a cap on spending growth tied to population growth plus inflation, we should view this as the maximum allowable limit—not the actual ideal.
The truth is that Texas’s governments should aim to spend far less. As the charts show, appropriations have consistently outpaced sustainable growth, leaving taxpayers to pick up the tab.
For example:
- State appropriations indexed to 1996 levels have quadrupled by 2024.
- Combined state and federal appropriations have grown even faster, far outstripping population and inflation growth.
Unchecked spending has consequences: It discourages investment, reduces disposable income, and limits job creation. Texans would have far lower tax burdens today if spending had been tied to population and inflation.
A Stronger Constitutional Spending Limit is Essential
Texas needs a constitutional spending limit for state and local governments to ensure real reform. Here’s what that should look like:
- Cover All State and Local Spending: No level of government should be allowed to sidestep fiscal discipline.
- Cap Spending Growth at Population + Inflation: This ensures spending grows in line with economic realities.
- Require a Two-Thirds Vote for Exceptions: Higher thresholds discourage unnecessary spending increases.
- Use Surplus Funds to Reduce Tax Rates: Prioritize property tax reductions to give Texans direct relief.
Such a framework aligns government incentives with taxpayers’ needs, ensuring more money remains in private hands where it fuels innovation and economic growth.
Why Spending Less Means Growing More
When the government spends less, Texans keep more. Lower taxes allow families to save for the future, businesses to expand, and entrepreneurs to create jobs. This virtuous cycle of economic growth benefits everyone.
By contrast, every dollar wasted on excessive government spending is a missed opportunity for economic growth. The charts above show that current spending trends are unsustainable and unnecessary. Free-market principles teach us that the private sector allocates resources far more efficiently than government ever can. By limiting spending, Texas can empower its citizens to create prosperity from the ground up.
A Crossroads for Texas
For two decades, Texans have entrusted Republican leadership to deliver on promises of limited government and low taxes. While progress has been made in some areas, the failure to control spending has undermined these efforts. The solution is clear: cut or freeze spending, cap future growth, and redirect surplus funds to tax rate reductions. These reforms will protect taxpayers, foster economic growth, and ensure Texas remains a beacon of opportunity for future generations.
Call to Action
Legislators and grassroots advocates, the time to act is now. Support the Frozen Texas Budget as a starting point and push for a constitutional spending limit to ensure fiscal discipline. Together, we can let Texans keep more of their money and unleash the full potential of the Lone Star State.
Texans for Fiscal Responsibility relies on the support of private donors across the Lone Star State in order to promote fiscal responsibility and pro-taxpayer government in Texas. Please consider supporting our efforts! Thank you!
Get The Fiscal Note, our free weekly roll-up on all the current events that could impact your wallet. Subscribe today!
