Texas’ Tech Future & Magnolia Effect

Published October 16, 2025

How does one reconcile Ecclesiastes 1:9 “There’s nothing new under the sun” with so many artificial intelligence projects impacting the Texas economy? Clearly, when that phrase was initially uttered, there was nothing like AI – yet.

I’m keeping an eye on some of the larger data center and power projects proposed for Texas, but not as much for the Bosque County-specific initiatives. I wouldn’t say I’m tracking any of them closely, though. We all know how it goes: a project makes a big splash in the news, but it can be years before anything actually happens if it ever does. And yet, real investment in our state is clearly in progress.

Money is being spent. Change is in motion. Side note: If you have suggestions for specific topics to explore amidst this incredible change, please let us know. Even so, I am going to draw from decades of personal experience to offer some general thoughts about what is probably coming our way. My hope this short narrative is to spark useful ponderings across the magnificent readership of this paper. And “for the record,” (pun intended) that’s a qualitative comment more than quantitative; though, I believe the paper’s numbers continue to climb. 

I’ll start with a question: Could Texas’s tech boom be creating its own version of the “Magnolia Effect”? You might know this phenomenon by other names like the “Fixer Upper Effect” or the “Silo Effect.” At its core, this effect is a double-edged sword. The same forces that revitalize or upgrade an area often lead to gentrification or related challenges, which begs the question: is all of this new growth stuff a good thing?

Most likely, but it always depends on who you are talking to. The “two-edged sword” dynamic is clear when you examine the numbers. My initial and simplistic research into 15 tech-focused Texas projects indicates they could generate between 20,000 and 40,000 new, high-paying jobs in our state. Furthermore, estimates suggest that Texans will fill at least half of these roles. While these figures are approximations, the fundamental point remains: a significant economic injection is coming, bringing with it both opportunity and disruption.

While that kind of economic growth is sought after, it inevitably strains infrastructure as build-outs lag behind needs. Power costs and property taxes can soar and local cultures can shift or disappear. For those who have loved Texas in the past, there’s no guarantee they’ll love the new version. This all can highlight the nasty dynamic of people pulling up the ladder behind them once they’ve arrived. While a self-centered attitude, it’s a sentiment I can certainly understand. And I’m very much in the camp of “Don’t California my Texas!”

Aspects of this dynamic are already in motion. A simplistic knee-jerk example has been those who hate windfarms or solar farms. Once again, I get it. But they’re still happening. I can promise, right now, someone is celebrating a new deal they believe will be transformative and some type of massive “win”, only to face the sober reality of its unforeseen drawbacks later. Simultaneously, someone else is underestimating or fighting a different project, failing to see it will deliver benefits far beyond anyone’s expectations. The future is rarely exactly what we predict. That’s just the way it is. 

After starting down this line of questioning, something interesting and even fortuitous happened, as it often does. A “random” YouTube video appeared in my feed – though, of course, the algorithm is far from random. It featured a British online influencer in Bastrop, Texas, researching the local impact of Elon Musk. To my surprise, one of the people he was interviewing was a friend of mine I first met in the mid-80s.

The existence of this video reinforced that I’m not the only one thinking about this. This isn’t some distant issue for the future. I believe these transformations are going to affect the daily lives of Texans much sooner and more deeply than we might suspect. This article serves as a heads-up, giving each of us a chance to be a bit more proactive instead of finding ourselves surprised as we start to notice what happens. 

Given that my friend is the President/CEO of the Bastrop Chamber of Commerce, her enthusiasm for the town’s growth was expected. Such development must seem vital for a community that took a hard hit from the horrible 2011 fires. The irony is that the fire itself may have primed the area for this comeback by clearing the old undergrowth and creating a mindset for new development.

The comparison of Elon Musk’s effect on Bastrop to the Gaines’s effect on Waco has some merit. There are many stories of residents who are struggling with these changes, and their hardship and frustrations are clearly real. Even so, I tend to reject zero-sum thinking. Situations can and do exist where there is more combined winning than losing. My deepest hope is that Texas and its people can find a future where, together, we minimize the downsides and all boats rise.

Ultimately, the outcome will be a mixed bag. This isn’t a statement of resignation, but a realistic observation calling for a sober approach for what’s coming. Change is inevitable, and its rate continues to increase. For the most part, we have the freedom to influence that change, so we must advocate for the future we want – whether that means embracing growth or slowing it down. But like it or not, it’s happening. Honest realization of this fact must be our starting point. Right?

I am fundamentally optimistic about the future of Texas, and I’m not alone. Leading geopolitical and economic analysts have identified Texas as one of the world’s premier locations for opportunity over the next half-century. I think they’re correct, and it’s our job to navigate the changes ahead to build the future they foresee and the one we choose.

And beyond this, let’s see what’s next!

 

J Matt Wallace