Texas Will Welcome ‘Fed Up’ Chicago Firms, Greg Abbott Says

Shelly Hagan and Julie Fine
·3 min read
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(Bloomberg) -- Texas Governor Greg Abbott has his eyes on Chicago.

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The Republican leader said he’s spoken to CME Group Inc., the world’s largest futures exchange, about relocating to the Lone Star State. CME and other Chicago-based trading firms have complained about a pickup in violent crime since the pandemic as well as potential tax increases floated by the mayor.

“I actually have approached the CME,” Abbott said Wednesday in an interview with Bloomberg Television in New York. “There are some businesses in Chicago that are fed up.”

Texas has benefited from a realignment in the finance industry in recent years that gained momentum during the pandemic. Firms have left high-tax states like California, New York and Illinois and moved to Sun Belt locales like Florida and Texas — both of which have no state income tax — to set up shop. That’s brought in new high-paying jobs and bolstered the local markets for housing and commercial real estate. Dallas is seeing its biggest finance industry boom since the 1980s oil bust.

Goldman Sachs Group Inc. is building a new campus in the upscale Dallas neighborhood of Victory Park. And Bank of America Corp. just announced it will be moving local operations to a new skyscraper that will be about a half-mile from Goldman’s planned campus. Another big lender, Wells Fargo & Co., has broken ground on a new tower in the Dallas suburb of Irving.

CME has been in Chicago for more than a century, and luring one of the most iconic trading firms to Texas would be a huge step forward and one that would diversify the financial services industry in the state.

Abbott’s remarks follow reports that CME and other financial firms in Chicago, including CBOE Global Markets Inc. and IMC, are alarmed by Mayor Brandon Johnson’s idea for $800 million in taxes, including a levy on financial transactions. In May, CME Chief Executive Officer Terry Duffy said the company is prepared to leave Chicago if local and state officials take steps that are “ill-conceived.”

A CME spokeswoman confirmed that Duffy has spoken to Abbott and declined further comment.

Chicago is also struggling to cope with an influx of immigrants that have arrived with little money and limited work prospects.

Abbott has been a prominent critic of the Biden administration’s immigration policies, blaming lax enforcement for a humanitarian crisis at the border. The state has sent National Guard troops and police officers to stem crossings, installed razor wire and paid to bus migrants to cities including New York, Chicago and Washington DC, where leaders are frustrated at the costs of providing housing and support.

Mayors in those cities have criticized Abbott’s actions, saying he was using human beings to make political points. They’ve also slammed the Biden administration for a lack of funds to cope with the influx, with New York’s mayor warning the city could spend as much as $12 billion helping migrants in the next two years.

But Texas cities have also been overwhelmed, with Eagle Pass and El Paso struggling with a surge in crossings last week. The mayor of Eagle Pass declared a state of emergency and told CNN that agents were apprehending about 1,000 people a day in a city of 30,00 people. El Paso’s mayor put the number at 2,000 a day.

“It is total chaos what we’re dealing with in Texas,” Abbott said during an appearance Wednesday at the Manhattan Institute in New York. “What is going on in New York is calm and organized compared to the real chaos of what we see on the border.”

--With assistance from Isis Almeida.

(Updates CME comment in eighth paragraph.)

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