In life, once every now and then, we come across something that is simple and says it all. In the 1950s, for example, when asked about life in Canada, the person who was asked the question answered that 90 percent of all Canadians live within 100 miles of the U.S.-Canadian border, while only 10 percent of all Americans live within 100 miles of the same border. That said it all.
When comparing California with Texas, U-Haul says it all. To rent a 26-foot truck oneway from San Francisco to Austin, the charge is $3,236, and yet the one-way charge for that same truck from Austin to San Francisco is just $399. Clearly what is happening is that far more people want to move from San Francisco to Austin than vice versa, so U-Haul has to pay its own employees to drive the empty trucks back from Texas. The great thing about this example is that it’s a market price set in the real world – you don’t need to rely on a fancy economic model to see our point. If two haughty-taughty food critics were arguing about restaurants A and B, the average Joe could ignore their jargon and just look at which place had a line out the door. When it comes to California and Texas, people are backed up, waiting to move out of the latter. We rest our case.
Go read the whole thing.
H/T: Glen Reynolds