Tipping Point New Mexico Episode 356: New Mexico GOP launches “Land of the Last”

On this week’s podcast interview Paul interviews former New Mexico Congressman and Chairman of the Republican Party Steve Pearce. Joined on the interview are Ashley Soular and Mike Curtis also of the GOP.

Starting out, Paul and Steve discuss the role of political parties and the challenges they face in adhering to the myriad federal and state laws regulating them and their activity.

Then Paul and the group discuss the GOP’s new video series “Land of the Last” which highlights some of the major issues facing New Mexico brought on by nearly 100 years of single-party rule.

All of the videos made (to date) are posted below:

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Tipping Point NM episode 355: New Mexico’s Economic Freedom, Gross Receipts Tax Cut Proposed and more

From Monday, Nov. 16, through Monday, Nov. 30 last year New Mexicans suffered under MLG’s “enhanced” lockdown which led to our own bread lines as people were forced to stand outside in the cold to get into grocery stores which were limited to 75 people indoors. The good news is that arguably the Virus appears to have peaked for THIS year in terms of infections.

New Mexico falls further behind in the latest economic freedom report.

Do New Mexico Democrats actually care about “progressive” taxation? Build Back Better is HARDLY “progressive.” 

Gov. MLG wants a tiny tax cut. Reducing GRT rates doesn’t solve the problem. Spaceport America has a generous tax exemption from the Legislature and is an example of the problem.

Who paid for MLG’s Scottish adventure and HOW exactly did she get there? 

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Opinion piece: Economic Freedom Takes a Hit in New Mexico

Anya Kamenetz | KRWG

The following appeared at KRWG on November 17, 2021.

Nearly any business owner in New Mexico will tell you that Michelle Lujan Grisham and her policies have been unfriendly to business. Setting aside the COVID lockdowns, since she took office in 2019, we’ve seen multiple tax hikes, numerous new regulations, and numerous policies that make it more costly and difficult to hire workers.

These policies aren’t just “anti-business,” taken as a whole they undermine economic freedom. A new study provides hard data that quantifies and highlights the negative impact of policies of Lujan Grisham and the Legislature (at least in 2019).

For starters, it is worth defining the term. Economic freedom is broadly speaking the ability to engage in voluntary economic transactions without unduly being hindered by government policies. This includes low, fair taxation, reasonable rules and regulations, and a limited government spending.

Not surprisingly, policies of economic freedom are strongly correlated with greater economic prosperity. In fact, according to the 2021 edition of the report, the freest 25% of states have personal incomes that are 7.5% higher than the national average while the 25% of least free states have personal incomes that are 1% less than the national average.

New Mexico has long lagged its neighbors and most of the nation in economic freedom having consistently been in the lowest quartile for years. Thus, it is not surprising that New Mexico is among the most impoverished states in the nation.

But, when Gov. Susana Martinez took office in 2011, New Mexico ranked 46th in economic freedom. Despite her having to deal with a hostile Legislature, that number improved to 42nd by the last year of her administration mostly due to her fiscal restraint.

But, when Lujan Grisham took over in 2019 along with a liberal Legislature the State saw a massive uptick in government spending, several tax hikes, new regulations, and numerous other policies that make New Mexico less economically-free. On the other hand, New Mexico’s neighbors are all among the most economically-free states in the nation. Texas, with no personal income tax and a pro-freedom labor laws like “Right to Work” ranks 4th overall.

While we don’t have the data on how economic freedom has fared in New Mexico in 2020 and 2021, we know that in general Gov. Lujan Grisham and the Legislature seem to look to California as their model. Alas, the State is one of the few ranked worse than New Mexico on economic freedom at 49th. Only New York performs worse.

The fact is that the policies passed in 2019 that caused New Mexico to slide in economic freedom have only been reinforced by others that further undermine economic freedom in 2020 and 2021.

With a $2 billion surplus, Gov. Lujan Grisham has proposed a miniscule reduction in the gross receipts tax (while leaving the grotesque pyramiding and loopholes intact). But, we can expect that an overwhelming majority of that surplus will go to even more government spending that will do nothing to actually improve New Mexico’s serious poverty challenges or overall economic outcomes.

It is time for New Mexico politicians (and voters) to prioritize economic freedom in turning our State around.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

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New Mexico Democrats don’t really care about “progressive” taxation or “taxing the rich”

Democrats LOVE to talk about “progressive” taxation and taxing the rich. Whether it’s AOC’s dress or Rep. Javier Martinez’ relentless push for “tax equity,” Democrats, especially here in New Mexico love to talk about taxing the rich.

So, it may be surprising to find out that one of the biggest components of the “Build Back Better” legislation which just passed the US House (with the votes of Stansbury and Leger Fernandez, but NOT Herrell) is a big tax cut for THE RICH. Specifically, the bill allows wealthy taxpayers in high-cost states with high taxes (like California and New York) to take a federal tax deduction against state taxes.

Not surprisingly, relatively poor New Mexico is NOT a big beneficiary of SALT, yet both liberal Democrats support the bill and numerous other elected legislators (and both Sen. Heinrich and Lujan have pledged support. 

See the following chart from the Committee for a Responsible Federal Budget which compares the impact of SALT with a child care tax cred expansion contained in the bill. None other than socialist Sen. Bernie Sanders criticized the addition of the SALT deduction to the bill saying, “It sends a terrible, terrible message…You can’t be on the side of the wealthy and the powerful if you’re gonna really fight for working families.”

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Digging into Spaceport America’s tax exemption

As we’ve noted repeatedly ONE of the problems with New Mexico’s gross receipts tax is the politically-motivated exemptions that are offered to well-connected interests. Spaceport America and Virgin Galactic are certainly among the most well-connected interests, so it is not surprising that they have been given favorable tax treatment by the Legislature.

Check out the 2019 ruling below:  But, as Kathleen Sloan writes in a new piece for the Sierra County Sun, Virgin Galactic has paid NO GRT on ticket sales “totaling $45 million, it would produce a windfall of $3.123 million dollars for the state and county.” To put it plainly, tickets are not the same as “launching, operating, or recovering space vehicles or payloads.”

Not only does the Spaceport benefit from a GRT exemption it also benefits from a very generous interpretation of that exemption.

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More analysis on the MLG’s GRT plan

As we’ve already noted, the main problem with Gov. Lujan Grisham’s plan to slightly reduce GRT rates by .25% is the fact that the real problem with the tax is taxation of services as business inputs.

Also, with what is expected to be a $2 billion surplus, the Gov. wants to return $145 million. That’s about 7 percent of the available surplus. And, while the State’s GRT rate would be reduced from 5.125% to 4.875%.

In every area of the State we’ve seen tax rates rise dramatically over the years. The chart below reflects Albuquerque’s rapid climb over the years to the current gross receipts tax rate of 7.875 percent. Rio Rancho’s rate is now 7.6875%. You can find a full list of local GRT rates with rates ranging to over 9%. Relative to Albuquerque’s overall GRT rate, a .25% cut is a 3.17% reduction in the GRT.

In addition to addressing taxes on business inputs and services, the Legislature needs to address local taxation authority and constrain the ability of local governments to raise rates.

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Episode 354: William Perry Pendley – Political Shifts in Federal Land Management

On this week’s podcast, Paul sits down with William Perry Pendley. Perry worked in the Department of Interior under Ronald Reagan and then headed up the efforts of the Mountain States Legal Foundation, a non-profit law firm that defends property rights in the American West. Pendley was appointed to deputy director by President Trump and then became acting director of the Bureau of Land Management in 2019.

Perry and Paul discuss the BLM and its importance in New Mexico, how political shifts have drastic impacts on land management techniques, and the radical politics of people in high places at BLM under the Biden Administration.

Enjoy this timely and important conversation!

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Who paid for MLG’s Scottish COP Adventure (and how did she get there)?

The moment Gov. Lujan Grisham hopped on a plane (presumably) to fly over to Scotland, we at the Rio Grande Foundation filed a public records request to find out exactly what carbon emitting form of transportation she used to get over there to hector us on OUR CO2 emissions all while her and several staffers emit massive amounts of carbon on their trip.

A) She (and staff) flew over to Scotland in coach;

B) She (and staff) flew over in First Class;

C) They all took a private jet (as did hundreds of other attendees).

So, we filed a public records request to find out. You can see the response to that request below. Long story, short: the taxpayers didn’t pay for the trip, so, they don’t have to provide the information. Here is the letter responding to our records request.

We’re assuming that a well-funded radical environmental group paid for the trip and will be filing further requests to that effect. Seems like our Gov.’s travel arrangements costing thousands of dollars to attend a foreign conference should be a public record, no? Will it be reported in her campaign contribution instead?

Climate change: Should you fly, drive or take the train? - BBC News

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Episode 353 No Masks for Governor Polis, Schools, Electricity and more

The Virus is spreading in Colorado and New Mexico, but Jared Polis isn’t going to reimpose a statewide mask mandate. He’s promoting monoclonal antibodies in addition to vaccination instead. MLG doesn’t discuss that much. On the other hand Gov. MLG goes on MSNBC w/ Joe Scarborough on TV IN A MASK:

On KRQE Paul shares how NM’s unemployment rate recovery among worst in US. 

Forbes ranks NM schools 51st in USA.

Trever cartoon roasts PNM/warns of blackouts.

Hearing examiner recommends that PNM be allowed to abandon its interest in Four Corners Generating station.

Paul recaps the recent PED hearing on social studies standards.

In a special interview, Paul talks to Dave Jenkins, President of Conservatives for Responsible Stewardship, about the Federal Oil & Gas Leasing System in New Mexico. The current system overwhelmingly favors oil and gas company executives and speculators over the owners of these resources–the American public. At one time Dave was Legislative staff for Senator Pete Domenici (R-NM).

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Reducing rates doesn’t solve problem w/ GRT (Updated)

With the Legislature expected to convene in January with up to $2 billion in “new money” (basically, surplus revenues generated primarily from oil and gas, Gov. Lujan Grisham has proposed a small reduction in the gross receipts tax of .25 percentage points. 

According to the Gov. this tax cut will reduce taxes by $145 million annually. That’s obviously a tiny fraction of the revenues that the Senate Finance Committee Chair (a Democrat) says is “more money than they know what to do with.”

Of course, as the Rio Grande Foundation has said for years, the REAL problem with New Mexico’s gross receipts tax is “pyramiding,” especially taxes paid on services as business inputs. Powerful Democrat Rep. Patty Lundstrom told attendees of the New Mexico Oil and Gas Association (NMOGA) conference that this needed to be addressed by the Legislature as the primary use of the surplus.

The essential difference between a “healthy” sales tax and New Mexico’s awful gross receipts tax is seen in the graphic below, but more fundamentally, the GRT leads to all kinds of special interest favoritism in the Legislature and it disproportionately harms small businesses:

Get a Handle on Gross Receipts Tax if Doing Business in New Mexico |  Resource Tool for Start-up and Small Businesses in New Mexico

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