New Mexico needs to constitutionally address its permanent funds

New Mexico’s permanent funds (money set aside constitutionally from its oil and gas industry) just hit $75 billion and, according to analysts, will hit $100 billion in less than four years (by 2030).

This MAY seem like a good problem to have, but the money itself isn’t really the problem, it’s the fact that while the State of New Mexico is sitting on massive piles of cash, the State continues to flail. We won’t go through all the data here, but New Mexico’s poverty rate, lack of economic diversity, poor education, and crime are all serious challenges. Not all of these problems can be easily solvable with money, but they can be improved upon. Besides, no one has put forth a plan to actually use that money to improve on New Mexico’s dismal statistics.

In fact, it would seem to us that New Mexico’s Democrats (who have held power for decades in this state) don’t have a plan for using the fund or improving upon New Mexico’s awful outcomes, because they DON’T KNOW HOW TO IMPROVE things. All we’ve seen from them for the duration of the oil and gas boom is more spending and new government programs. Each one was supposed to have magical, positive impacts on New Mexicans’ lives, but they have not.

We’d recommend some form of broad based tax cuts and/or possible new broad-based business incentives or even tax cuts. It is hard to know exactly what can and cannot be done with this money under its constitutional requirements which also require congressional approval for revenues to be used. Regardless of limitations, it is time for the next Gov. to carefully consider using some of this money to make needed economic changes to New Mexico. A lot can be done with even a tiny fraction of $75 or $100 billion. The entire concept of the permanent fund is based on economic fallacy. Sadly, New Mexico has a poor track record of using its oil and gas wealth to improve outcomes for its citizens.