The rise of Texas

Seen from a helicopter above Dallas-Fort Worth, the corporate campuses and factories of companies that have decamped from California and the US north-east stretch to the horizon.

This is the landscape of today's Texas — a Republican state that has gone out of its way to be as business friendly as possible and now boasts more Fortune 500 companies than its Democrat-controlled rivals, with 57 to California's 56.

"Any time you raise a tax or hurt the job creators or put in more regulation, Texas becomes even more attractive," says Ross Perot Jr, chair of the property developer Hillwood, as well as the US Chamber of Commerce and the Perot Group family office.

More than 100 companies have relocated their headquarters to the state since 2020, including Charles Schwab, Tesla and Hewlett Packard Enterprise. Some have also made Texas their corporate domicile as the state overhauls its business code to give more power to management at the expense of shareholders.

For many in Texas, rolling out the red carpet for companies, dismantling diversity, equity and inclusion policies and stamping out "extortionist" shareholder suits is part of redressing a power imbalance that holds back growth.

They point to the robust health of the state's economy — which would be the world's eighth-largest if it were a country — as vindication of their strategy.

"The best example we have recently is Elon Musk," says Perot, the son of the Texas-based billionaire who twice ran for president in the 1990s. "Why did Elon leave California right in the middle of Covid? They're shutting down his factories and he came to Texas and we're wide open."

Not content with moving Tesla to Austin in 2021, Musk incorporated SpaceX in Texas after a Delaware trial court ruled against his $56bn pay package in 2024.

The state has diversified its corporate base far beyond its energy roots, seeking to rival California in tech and New York in financial services. Its burgeoning power is increasingly shaping America's corporate landscape.

More data centre capacity is under construction in Texas than any other state in the US, according to Wood Mackenzie. JPMorgan now has more employees in the state than it does in New York.

While proponents see the state as a model for the US as a whole — and a laboratory for pro-business ideas — its approach is being tested by a growing backlash against the data centres, and midterm elections in which the Democrats are threatening the Republicans' hold on a long-safe Senate seat.

In a state where checks on capitalism have been systematically eroded over the years, Big Tech has much at stake in November's vote — as does business as a whole.