A new study called “Taxifornia,” by the free-market Pacific Research Institute studies state tax burdens and mechanisms for tax collection nationwide. As you might be able to assume from the study’s title, California does not perform especially well. In fact, according to the study, California’s state and local spending as a share of gross state product is fourth-highest in the nation (New York, South Carolina, and Alaska score worse).
What does this all mean for us in New Mexico? Well, we happen to be fifth worst in terms of spending, only slightly worse than California. Where’s Texas? Not surprisingly, Texas’ tax burden is third-lowest in America with only South Dakota and Delaware lower.
Needless to say, New Mexico policymakers have long relied on federal spending to make our economy run. Given the need to cut federal spending, it would be great if we decided to change directions by taking a cue from economically-robust Texas rather than failing California.