Bailing Out the College of Santa Fe

It seems that Governor Richardson and the City of Santa Fe are dead set on saving the bankrupt College of Santa Fe. Richardson has pledged $11 million for the school — don’t you love how politicians, particularly the executive branch, can arbitrarily throw massive amounts of money around regardless of what the Legislature does or what might be best for the average citizen? The Governor is not alone. The City of Santa Fe is moving forward with a plan to purchase the College through a massive (and I might add, risky) issuance of bonds.
Of course, it would seem that perhaps the College’s failure might be due to inadequate demand for its services or a lack of perceived value for the price from potential customers (see the Big 3 for further details), but unlike the private sector which self-regulates by squeezing out inferior and unnecessary products, government has every incentive in the world to provide a taxpayer-funded bailout.
While the current economic situation would be painful enough by itself, it is government policies that are extending the pain to taxpayers and others who were largely blameless. Hopefully Governor Richardson and the City of Santa Fe allow the College of Santa Fe to play its part in the cycle of “creative destruction,” but if history is any guide, New Mexico taxpayers will soon be paying once again for someone else’s mistakes.